A county in the U.S. state of Washington is seeking to impose higher electricity rates for cryptocurrency miners.
Cryptocurrency mining is a touchy subject, especially for authorities in the cities or municipalities where the operations are happening. This is mainly due to the amount of power used, which, in some cases, far exceeds the average power consumption of the area.
Some of these authorities currently have moratoriums in place, effectively halting applications of prospective miners. Others are charging these miners for the extra power that needs to be purchased, which otherwise would have come out of residents’ pockets. Plattsburgh in New York is even looking to have mining regulated in the city.
According to KPQ, Chelan County in the U.S. state of Washington seems to be following suit and have proposed an increase rate structure for crypto mining, which has resulted in some unhappy miners.
Increased Power Rates for Cryptocurrency Miners
Chelan County Public Utility District (PUD) recently introduced their proposal for a rate structure aimed at cryptocurrency miners. Chelan County’s Customer Utilities Rate Adviser, Lindsey Mohns, explained what miners can expect:
This rate structure is built the same way as the existing rate structure that cryptocurrency miners are paying right now, which is referred to as Schedule 35. What this new rate structure does is brings into it a market consideration on the energy price because we will have to purchase power on the market to serve the variable load associated with cryptocurrency.
Our upfront capital charges are intended to recover the accelerated cost of infrastructure investment in our system, mainly in our substations, which is kind of the main component of the distribution system. So the upfront charges take into account the capacity that’s used by cryptocurrency miners.
These miners were actually in attendance at the unveiling of PUD’s new structure, and Denton Meier didn’t mince any words when providing feedback. Meier is a co-owner of Firefly Technologies and Silicon Orchard. He said:
I think it’s nice to be able to make comment but it seems like they’ve already made up their mind. What’s been missing is actually a round-table discussion and more of a brain storming session. How can we really affect the local economy, how can we work together? Let’s create a business-case scenario and include the PUD in that.
If the structure is approved, Meier added that Chelan could see an exodus of cryptocurrency miners as well as any type of job creation:
Looking at it in a bigger picture it’s not just mining but services that can happen around that. Like jobs creation in programming, finance, and other things that will happen over time with the cryptocurrency market. We have the opportunity to become a hub for that. With rates that price us out of that ballgame, it’s not that root that we need to then grow those other businesses, so that will happen elsewhere.
Mohns doesn’t believe that any kind of mass departure is imminent though and thinks that this would have happened already as PUD has had many other meetings of a similar nature.
However, crypto experts have a history of migrating to more welcoming shores if it benefits them. We’ve seen this with major exchanges that have left certain countries with unclear regulations in favor of locations with more positive and clearer guidelines.
We’ll just have to wait and see if this will happen to the crypto miners in Chelan County.
Do you think that Chelan County will push through with this new rate structure? Will it result in the end of crypto mining in the county? Let us know in the comments below!
Images courtesy of ShutterStock.