⚡ Dam Yankees

Brazil keeps an eye on Rubio’s Itaipu comments. Tarcisio de Freitas launches a new anti-poverty plan in São Paulo. Gol and Azul risk heading in opposite directions despite merger talk

Author

Gustavo Ribeiro
May 21, 2025

ENERGY AND DIPLOMACY

Rubio’s Itaipu suggestion raises eyebrows in Brazil

“Someone, if they’re smart, is going to go down to Paraguay and open up an AI facility,” said Marco Rubio, speaking to the US Senate Committee on Foreign Relations. Photo: Freddie Everett/USDS

“Someone, if they’re smart, is going to go down to Paraguay and open up an AI facility,” said Marco Rubio, speaking to the US Senate Committee on Foreign Relations. Photo: Freddie Everett/USDS

In a Tuesday US Senate hearing on global energy strategy, US Secretary of State Marco Rubio floated an idea that sent shockwaves through Brazil’s policymakers and diplomatic corps. 

Citing the gargantuan energy demands of artificial intelligence systems, Rubio pointed to Paraguay as a potential hub for AI development — thanks to its access to cheap hydropower from the massive Itaipu Dam.

“Paraguay has a hydroelectric plant right now, and they were in a long term deal with Brazil, where they sold them 50% of the energy being produced. That deal is now expired,” Rubio said. “They’re trying to figure out what to do with the 50% of electricity generated by hydropower that is no longer going to be going to Brazil, and they can’t put that in a tank and ship it overseas. So someone, if they’re smart, is going to go down to Paraguay and open up an AI facility.”

The comment laid bare the tangled history — and present tension — surrounding Itaipu, the massive binational dam shared by Brazil and Paraguay.

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