Looking to take advantage of low-cost electricity, cryptocurrency miners have set up shop in upstate New York — but municipal power authorities and locals aren’t welcoming them.
On Thursday, the New York State Public Service Commission gave upstate municipal power authorities the power to charge higher rates to companies, which mine cryptocurrency.
According to a release from the Commission, the ruling was a necessary measure to prevent the rise of local electricity prices for existing residential and business customers. Due to the increased demand for energy from large-scale cryptocurrency mining companies, the Commission felt the need to “level the playing field.”
Said Commission Chair John B. Rhodes:
We always welcome and encourage companies to build and grow their businesses in New York. However, we must ensure business customers pay an appropriate price for the electricity they use. This is especially true in small communities with finite amounts of low-cost power available. If we hadn’t acted, existing residential and commercial customers in upstate communities served by a municipal power authority would see sharp increases in their utility bills.
The Commission’s ruling came after the New York Municipal Power Agency (NYMPA) — an association comprised of 36 municipal power authorities — requested action be taken against high-density load customers.
NYMPA cited a negative impact on local power supplies after cryptocurrency mining companies seeking to benefit from the region’s low-cost electricity. According to the Commission’s release, “disproportionately large amounts of power” have been requested in recent months by server farms looking to mine cryptocurrency.
NYMPA also claimed that cryptocurrency mining companies “do not bring the economic development traditionally associated with similar load-sized companies” — due to the fact that cryptocurrency mining requires a relatively small workforce compared to other electricity-intensive operations.
NYMPA also claims cryptocurrency mining companies “make little to no capital investment in the local community.”
The change in electricity pricing is expected to drastically increase the costs associated with cryptocurrency mining in upstate New York.
This news also coincides with Plattsburgh’s outright ban on cryptocurrency mining, after residents’ electricity bills skyrocketed. The Commission’s release notes:
Had the new rates been in place in January, the two cryptocurrency companies in Plattsburgh would have seen a more than 60 percent increase in their monthly electricity costs.
What do you think about cryptocurrency mining’s impact on local residents’ and businesses’ energy costs? Let us know in the comments below!
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