On Feb. 20, Brazil’s overseas commerce council revealed a technical decision decreasing import duties to zero for a slim class of {hardware}: SHA256 Bitcoin miners exceeding 200 terahashes per second with power effectivity beneath 20 joules per terahash.
Three days later, French state-owned power big 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 power, and Bitcoin mining is the discharge mechanism.
This is not a narrative about Brazil “legalizing” mining or launching a nationwide technique. It is concerning the quiet convergence of three forces: continual curtailment, falling {hardware} price obstacles, and generator economics breaking.
Collectively, they create the circumstances for incremental hashrate to circulation towards a market no one was watching.
The curtailment downside that Bitcoin miners can resolve
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 because of the flawed place, the flawed 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 characteristic of techniques with excessive shares of variable renewables, not a brief friction.
Because the renewables combine rises and transmission buildout lags, the mismatch grows. Mills want native, dispatchable demand that may take in otherwise-wasted electrons and activate or off shortly. Bitcoin mining suits that profile exactly.
Engie’s Assu Sol plant is positioned 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 ability extra worthwhile by monetizing power that might in any other case be curtailed, however emphasised this is able to 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 software.
What the tax change really does to Bitcoin miners
Resolução GECEX 861, revealed Feb. 20, amends Brazil’s consolidated ex-tariff listing to cut back import obligation to zero for particular data know-how items.
Annex I provides a brand new line protecting servers devoted to cryptocurrency mining utilizing the SHA256 algorithm with power effectivity measured at 35 levels Celsius, beneath 20 joules per terahash, and processing capability above 200 terahashes per second.
The zero-percent obligation stays in impact via 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 really compete at scale in knowledgeable mining setting.
Brazil’s import tax construction is notoriously layered. Import obligation is one element of the whole 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 obligation to zero removes one federal lever however would not get rid of the total stack.
However, Brazil diminished a key price barrier for high-efficiency mining {hardware}, reducing payback intervals, regardless that 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, each day income equals roughly $6.81. Energy consumption is 4.0 kilowatts. Every day power 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 change 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.
Nevertheless, wholesale spot costs typically commerce within the 250-450 reais per megawatt-hour vary, and curtailed power, by definition, has no higher purchaser.
If a generator can promote otherwise-lost megawatt-hours to a miner at or beneath its break-even price, the generator recovers income that might 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 may ramp inside days of {hardware} supply. The ex-tariff stays in impact via 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 comparable choices. If a number of giant renewable initiatives announce colocation offers over the following 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 might entice mining income onshore.
But, the thesis also can fail. If transmission upgrades speed up and cut back curtailment, the stranded power pool shrinks, and energy costs rise.
If Bitcoin’s problem spikes, compressing the hash charge beneath the $30-per-petahash vary, break-even energy prices drop beneath what most curtailment contracts can ship.
If native allowing or grid interconnection processes create friction for information middle 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.
BucketMetricValueWhy it mattersCurtailment scaleWind curtailment (Oct 2021–Sep 2025)32 TWhDefines the “stranded worth” pool mining targetsCurtailment impactWind income misplaced (identical interval)R$6B (~$1.2B)Exhibits curtailment is an economics downside, not a rounding errorRenewables penetrationWind+photo voltaic share of technology (2024)24percentHigher VRE share tends to lift congestion/curtailment pressureRenewables penetrationWind+photo voltaic share (Aug 2025)34%“First time” milestone that alerts structural shiftPolicy filterEligible hardwareSHA256, >200 TH/s, <20 J/TH @35°CTargets top-tier ASIC class; excludes older rigsPolicy window0% import obligation legitimate throughJan 31, 2028Time-bounded “choice window” for miners to moveUtility signalEngie Assu Sol plant size895 MWpBig sufficient to matter; reveals severe generator interestMining revenueHashprice (Feb 16)$34.05 / PH/s/dayAnchors profitability mathRig economicsMin qualifying rig each day income~$6.81/dayTies income to a selected machine classRig economicsPower draw4.0 kWConverts effectivity → electrical energy price sensitivityRig economicsDaily energy96 kWh/dayMakes break-even intuitiveBreak-even powerElectricity break-even$0.071/kWh (~R$370/MWh)The quantity that decides “hub or not”Value actuality checkRetail enterprise electrical energy (June 2025)R$0.657/kWh (R$657/MWh)Exhibits why miners want wholesale/curtailment pricingPrice actuality checkWholesale spot band (typically)R$250–450/MWhShows feasibility zone exists typically
The Bitcoin miner constraint nobody talks about
Zero-percent import obligation issues, but it surely would not repair the financing hole.
Mining {hardware} has a helpful life measured in problem epochs, not many years. Brazil’s price of capital is greater 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 buildings that may take in illiquidity.
The opposite constraint is operational. Mining at renewable vegetation works when curtailment is predictable or when contract buildings enable interruptible load.
Nevertheless, 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 turn into 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 wager is narrower than it seems to be: can miners take in sufficient curtailed power to enhance generator economics with out destabilizing the grid or creating new political danger?
If the reply is sure, Brazil captures incremental hashrate with out subsidizing it immediately: 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 manner, the coverage is time-bound, the economics are clear, and the dedication is reversible.
However choices have worth when the underlying circumstances align, and Brazil’s circumstances are aligning.
Curtailment is rising, {hardware} prices simply dropped, and a significant generator is publicly pricing the trade-off.
The window is open via January 2028. What occurs subsequent relies on whether or not sufficient miners acknowledge the opening earlier than it closes.
