Data Centers in Asunción
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Asunción – Low-Cost Hydroelectric Hub for the Southern Cone
Executive Summary
Asunción is a strategic choice for organizations needing 100% renewable energy at a fraction of regional costs. It serves as a resilient foundation for reaching the Paraguayan market and providing edge services in the Southern Cone. This market provides high-density compute capacity with nearly zero carbon footprint, ensuring long-term operational sustainability and significant cost reduction for heavy workloads.
Asunción: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Reliable regional performance for local and cross-border traffic. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Nearest major on-ramp hub is Sao Paulo. |
| Power Cost | $0.05/kWh – as of September 2025 | Exceptionally low rates driven by 100% renewable hydroelectric sources. |
| Disaster Risk | Low (3.0/10) – as of September 2025 | Very stable environment with primary concerns limited to seasonal flooding. |
| Tax Incentives | No | No specific incentives for data centers; focus is on assembly operations. |
| Sales Tax | 10% VAT – as of September 2025 | Competitive consumption tax rate compared to larger regional neighbors. |
Network & Connectivity Ecosystem
Asunción serves as the central aggregation point for Paraguayan data traffic, balancing domestic demand with regional transit requirements.
Carrier Density & Carrier Neutrality: Carrier count: over 10 as of September 2025. The market features a mix of domestic incumbents and regional players providing a reliable foundation of terrestrial fiber and wireless backhaul for enterprise requirements.
Direct Cloud On-Ramps: Over 0, enabling access to 0 cloud regions as of September 2025. There are currently no direct physical on-ramps for major providers like AWS or Google Cloud (GCP) located within the city. Enterprise traffic typically routes through Sao Paulo or Buenos Aires via private network extensions.
Internet Exchange Points (IXPs): IX.py (Internet Exchange Paraguay) is the central peering facility, helping local providers exchange traffic efficiently to keep latency low for domestic users.
Bare Metal: Infrastructure requirements are met through local providers and regional specialists like Latitude.sh, supporting automated deployments for compute-heavy workloads.
Power Analysis
Asunción offers one of the most attractive power profiles in Latin America, combining environmental sustainability with extreme cost-efficiency.
Average Cost Of Power: Industrial electricity is approximately $0.05/kWh as of September 2025. This pricing is roughly 100% renewable, sourced from the massive Itaipu and Yacyretá hydroelectric dams. These rates provide a substantial operational advantage for high-density colocation and high-performance computing.
Power Grid Reliability: The grid is supported by significant hydroelectric overcapacity and redundant transmission lines from the major dams. Facilities in the primary data center corridors benefit from well-engineered infrastructure and multi-substation support.
Market Access, Business & Tax Climate
Asunción is the commercial engine of Paraguay, providing a centralized location for digital transformation projects.
Proximity To Key Business Districts: Data centers are strategically located near the Mariscal López axis and the emerging corporate center in Villa Morra. This puts critical infrastructure within kilometers of the nation’s banking, telecommunications, and government headquarters.
Regional Market Reach: The city serves as a gateway for the Paraguayan population of over 7 million. Its geographic position between Brazil and Argentina makes it a useful secondary site for disaster recovery or edge caching in the Southern Cone.
Tax Advantage For Data Centers: The stable 10% VAT rate creates a predictable financial environment for long-term infrastructure planning. This straightforward tax regime helps maintain lower operational overhead compared to the more complex tax structures found in larger neighboring economies.
Natural Disaster Risk
Asunción maintains a favorable risk profile for infrastructure, with an overall score of Low (3.0/10) as of September 2025. The city is geographically stable, though specific environmental factors require consideration.
- River Flood (5.6): Seasonal flooding of the Paraguay River is the primary natural concern for low-lying areas.
- Epidemic (5.6): Public health risks are rated at a moderate level, necessitating continuity planning for personnel.
- Drought (3.9): Extended dry periods can impact river levels, though hydroelectric supply remains resilient due to massive reservoir capacities.
- Earthquake (0.1): Seismic activity is negligible, making the region highly stable for physical structures.
Coastal Flood and Tsunami risks are not applicable to this inland location. All other natural hazards are minor as of September 2025.
