The Commons Foundation has signed a 100-megawatt, 10-year power purchasing agreement with Paraguay's grid operator, buying energy that it plans to use for crypto mining.

The South American country's grid runs almost entirely on hydroelectric power, with a price of around 5 cents per kilowatt hour thanks to dams built on some of the world's biggest rivers. Most of the electricity from the Itaipu dam, the world's largest in terms of average annual energy production, is exported to Brazil under a treaty that is set to expire in 2023.

The Paraguay government is looking to attract bitcoin (BTC) miners to soak up excess energy. Last week, the country's Senate passed a bill to regulate the industry. The bill requires miners to be licensed by authorities.

The 100 MW secured by the Commons Foundation will create 1,000 jobs over the next four years in Villa Hayes at district Jose Falcon in central Paraguay, according to a press release sent to CoinDesk.

The contract between the Paraguay Electrical Authority (ANDE) and the Commons Foundation sets the price for the electricity at $30.78 per megawatt hour (mWh). However the price can be readjusted annually, as well as depending on regulations, under the terms of the deal. Miners usually prefer fixed-price agreements, locking in prices in advance so that they are not affected by price fluctuations.

"Our contract today is a historic day for Paraguay. I am confident that this business will succeed and attract more investors," said ANDE Chairman Félix Sosa in the press release.

The contract was signed on July 15 but announced on Thursday.

The Commons Foundation is a Singapore-based organization that invests in crypto and blockchain projects.

Canadian firm Bitfarms (BITF) operates a 10 MW mining site in south-central Paraguay.

Read more: Paraguayan Senate Passes Bill Regulating Crypto Mining and Trading

CORRECTION (July 21, 22:14 UTC): A previous version of this story incorrectly stated that the contract between the Paraguay Electrical Authority and the Commons Foundation was a variable price contract.