On Feb. 20, Brazil’s overseas commerce council printed a technical decision lowering import duties to zero for a slender class of {hardware}: SHA256 Bitcoin miners exceeding 200 terahashes per second with vitality effectivity under 20 joules per terahash.
Three days later, French state-owned vitality large Engie informed Reuters it was contemplating putting in Bitcoin miners at its 895-megawatt Assu Sol plant in northeast Brazil, the corporate’s largest photo voltaic facility globally, to monetize curtailed electrical energy and enhance profitability.
The 2 developments landed inside 72 hours of one another, and collectively they sketch a thesis most observers missed: Brazil is constructing a stress valve for stranded renewable vitality, and Bitcoin mining is the discharge mechanism.
This is not a narrative about Brazil “legalizing” mining or launching a nationwide technique. It is in regards to the quiet convergence of three forces: continual curtailment, falling {hardware} price obstacles, and generator economics breaking.
Collectively, they create the situations for incremental hashrate to circulate towards a market no person was watching.
The curtailment downside that Bitcoin miners can clear up
Brazil’s wind trade curtailed roughly 32 terawatt-hours between October 2021 and September 2025, amounting to about 6 billion reais (roughly $1.2 billion) in misplaced income for wind farms.
Curtailment happens when the grid cannot take in the electrical energy being produced as a result of unsuitable place, the unsuitable time, or inadequate transmission capability. For renewable mills, curtailed megawatt-hours are destroyed worth.
Wind and photo voltaic generated 24% of Brazil’s electrical energy in 2024, and in August 2025, that share hit 34% for the primary time.
Grid operator ONS describes curtailment as a structural function of techniques with excessive shares of variable renewables, not a short lived friction.
Because the renewables combine rises and transmission buildout lags, the mismatch grows. Turbines want native, dispatchable demand that may take in otherwise-wasted electrons and activate or off shortly. Bitcoin mining matches that profile exactly.
Engie’s Assu Sol plant is situated in Brazil’s northeast, a area with sturdy photo voltaic irradiance however transmission constraints.
The corporate informed Reuters that mining or storage may make the power extra worthwhile by monetizing vitality that will in any other case be curtailed, however emphasised this could take years to implement.
The sign issues as a result of it is coming from a state-owned European utility with no prior crypto publicity, framing mining purely as an industrial demand response device.
What the tax change truly does to Bitcoin miners
Resolução GECEX 861, printed Feb. 20, amends Brazil’s consolidated ex-tariff listing to cut back import responsibility to zero for particular info expertise items.
Annex I provides a brand new line overlaying servers devoted to cryptocurrency mining utilizing the SHA256 algorithm with vitality effectivity measured at 35 levels Celsius, under 20 joules per terahash, and processing capability above 200 terahashes per second.
The zero-percent responsibility stays in impact by Jan. 31, 2028.
This isn’t a blanket exemption for all mining {hardware}. The thresholds filter for top-tier ASICs. Older or much less environment friendly fashions do not qualify. The coverage targets the {hardware} class that may truly compete at scale in an expert mining surroundings.
Brazil’s import tax construction is notoriously layered. Import responsibility is one element of the overall landed price, together with IPI, PIS/COFINS-Import, ICMS, and numerous charges. Commerce logistics guides generally cite complete import burdens within the 40%-100% vary.
Reducing import responsibility to zero removes one federal lever however does not get rid of the complete stack.
However, Brazil lowered a key price barrier for high-efficiency mining {hardware}, decreasing payback intervals, though different taxes stay.
The break-even energy worth that makes this work
Mining profitability relies on three variables: hash worth (income per terahash per second per day), {hardware} effectivity, and electrical energy price.
As of Feb. 16, Hashrate Index reported a hash worth of round $34.05 per petahash per second per day. Bitcoin traded close to $64,000 on Feb. 23.
For a minimum-qualifying rig beneath Ex 040, with 200 terahashes per second at 20 joules per terahash, day by day income equals roughly $6.81. Energy consumption is 4.0 kilowatts. Each day vitality use is 96 kilowatt-hours.
The break-even electrical energy worth, ignoring capital expenditure and working overhead, is about $0.071 per kilowatt-hour.
Changing to reais utilizing the Feb. 23 trade charge of roughly 5.17 reais per greenback, break-even sits round 370 reais per megawatt-hour. Retail enterprise electrical energy costs in Brazil averaged 0.657 reais per kilowatt-hour in June 2025, which is much too excessive for mining.
Nonetheless, wholesale spot costs usually commerce within the 250-450 reais per megawatt-hour vary, and curtailed vitality, by definition, has no higher purchaser.
If a generator can promote otherwise-lost megawatt-hours to a miner at or under its break-even price, the generator recovers income that will in any other case be zero.
That is the mechanism: curtailment creates stranded worth, mining converts stranded worth into computation, and the ex-tariff drops {hardware} price sufficient to tighten the arbitrage window.
What occurs if the thesis performs out
If Brazil’s curtailment persists or grows, pushed by continued renewables buildout outpacing transmission capability, mills will face mounting income stress.
Mining presents a bilateral PPA construction that requires no new transmission and might ramp inside days of {hardware} supply. The ex-tariff stays in impact by January 2028, making a 24-month window for miners to lock in {hardware} price certainty whereas testing curtailment economics.
Engie’s pilot framing suggests different utilities and impartial energy producers will consider related choices. If a number of massive renewable tasks announce colocation offers over the subsequent 12 months, Brazil turns into a significant incremental hashrate vacation spot.
This occurs not due to nationwide technique, however as a result of project-level economics align.
The nation already has regulatory readability round Bitcoin, established banking infrastructure for crypto companies, and no capital controls that will lure mining income onshore.
But, the thesis may also fail. If transmission upgrades speed up and cut back curtailment, the stranded vitality pool shrinks, and energy costs rise.
If Bitcoin’s problem spikes, compressing the hash charge under the $30-per-petahash vary, break-even energy prices drop under what most curtailment contracts can ship.
If native allowing or grid interconnection processes create friction for information heart builds, the {hardware} price benefit turns into irrelevant.
And if the ex-tariff expires in January 2028 with out renewal, the import price barrier returns.
| Bucket | Metric | Worth | Why it issues |
|---|---|---|---|
| Curtailment scale | Wind curtailment (Oct 2021–Sep 2025) | 32 TWh | Defines the “stranded worth” pool mining targets |
| Curtailment influence | Wind income misplaced (similar interval) | R$6B (~$1.2B) | Reveals curtailment is an economics downside, not a rounding error |
| Renewables penetration | Wind+photo voltaic share of era (2024) | 24% | Increased VRE share tends to lift congestion/curtailment stress |
| Renewables penetration | Wind+photo voltaic share (Aug 2025) | 34% | “First time” milestone that alerts structural shift |
| Coverage filter | Eligible {hardware} | SHA256, >200 TH/s, <20 J/TH @35°C | Targets top-tier ASIC class; excludes older rigs |
| Coverage window | 0% import responsibility legitimate by | Jan 31, 2028 | Time-bounded “possibility window” for miners to maneuver |
| Utility sign | Engie Assu Sol plant measurement | 895 MWp | Sufficiently big to matter; exhibits severe generator curiosity |
| Mining income | Hashprice (Feb 16) | $34.05 / PH/s/day | Anchors profitability math |
| Rig economics | Min qualifying rig day by day income | ~$6.81/day | Ties income to a selected machine class |
| Rig economics | Energy draw | 4.0 kW | Converts effectivity → electrical energy price sensitivity |
| Rig economics | Each day vitality | 96 kWh/day | Makes break-even intuitive |
| Break-even energy | Electrical energy break-even | $0.071/kWh (~R$370/MWh) | The quantity that decides “hub or not” |
| Value actuality test | Retail enterprise electrical energy (June 2025) | R$0.657/kWh (R$657/MWh) | Reveals why miners want wholesale/curtailment pricing |
| Value actuality test | Wholesale spot band (usually) | R$250–450/MWh | Reveals feasibility zone exists generally |
The Bitcoin miner constraint nobody talks about
Zero-percent import responsibility issues, however it does not repair the financing hole.
Mining {hardware} has a helpful life measured in problem epochs, not many years. Brazil’s price of capital is increased than within the US or Europe, and native banks have restricted urge for food for crypto-native credit score.
Miners scaling in Brazil will want both offshore financing denominated in {dollars} or fairness constructions that may take in illiquidity.
The opposite constraint is operational. Mining at renewable vegetation works when curtailment is predictable or when contract constructions enable interruptible load.
Nonetheless, if curtailment turns into sporadic or grid dynamics shift hour to hour, uptime suffers, and efficient hash worth declines.
Engie’s “years to implement” remark suggests the corporate understands that bolt-on mining infrastructure requires engineering, not only a PPA signature.
What Brazil is definitely betting on
Brazil did not get up and determine to grow to be a mining hub. It created a focused price discount for {hardware} that may monetize a structural grid downside, and a state-owned utility publicly examined the narrative on the identical day.
The guess is narrower than it appears to be like: can miners take in sufficient curtailed vitality to enhance generator economics with out destabilizing the grid or creating new political threat?
If the reply is sure, Brazil captures incremental hashrate with out subsidizing it straight: miners pay for energy, mills recuperate misplaced income, and the ex-tariff removes friction.
If the reply is not any, the decision expires in January 2028, and the experiment ends. Both approach, the coverage is time-bound, the economics are clear, and the dedication is reversible.
However choices have worth when the underlying situations align, and Brazil’s situations are aligning.
Curtailment is rising, {hardware} prices simply dropped, and a significant generator is publicly pricing the trade-off.
The window is open by January 2028. What occurs subsequent relies on whether or not sufficient miners acknowledge the opening earlier than it closes.