Cryptocurrency mining is an attractive business model in Canada. Access to cheap electricity is abundant. Hydro-Quebec has now received permission to charge higher rates to cryptocurrency miners, which will put a crimp in the plans of miners seeking to set up shop in the region.
Utility providers keep close tabs on the electricity usage by Bitcoin miners. Generating Bitcoin is a very energy-intensive industry. With more firms setting up shop in Canada, the electricity usage needs to be kept in check so that residential consumers are not unduly impacted. Hydro-Quebec now has the power to do exactly that. The utility provider can charge miners higher rates for precious electricity.
This decision is made by the Regie de l’energie. A hefty document was issued on Friday which touches upon Hydro-Quebec’s requests for higher energy costs to cryptocurrency mining operations. The regulator agrees with most of the company’s demands. Charging cryptocurrency miners twice the amount of regular consumers is now allowed. This will not affect current companies relying on the firm’s electricity.
Enforcing this higher fee only occurs for clients tapping into the network while a temporary blockade is in place. This decision will help ensure the security of the company’s electricity supply. Crypto mining can result in large spikes of demand for power. That puts regular consumers and businesses at risk. Avoiding any unnecessary friction is always the preferred outcome.
Agreements between Hydro-Quebec and municipal networks prior to June 6th will be upheld. These networks consume up to 150 mW. New entrants will be subject to an extra “block” of energy of 500 mW. All applications will be reviewed manually. Additionally, Hydro-Quebec will label specific clients as “crypto miners” depending on their requirements.
For distributors, this news is rather beneficial as well. They can avoid bidding for large amounts of power which are unnecessary. Dealing with specific and predetermined demand will clear up a lot of misconceptions. It can even benefit Canada’s cryptocurrency mining ecosystem as a whole. In the end, an open mind toward Bitcoin mining remains in place.
Other countries may follow a similar example. Bitcoin mining is very profitable in a few countries as of right now. The State of New York even revised its existing pricing guidelines to attract more mining firms. It is another sign of further legitimizing the cryptocurrency industry as a whole. All of these developments pave the way for Bitcoin to eventually become more commonplace.
Do you think cryptocurrency miners should pay more for electricity? Let us know in the comments below.
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