The province of Québec has been permitted to charge a higher price on electricity to its local cryptocurrency miners.
Canada has been very upfront with its interest in cryptocurrencies and the advantages offered by blockchain technology. They use said technology to modernize several air travel procedures and have approved a blockchain exchange-traded fund (ETF).
But now Québec is trying to solve its main issue with cryptocurrency mining. Montreal Gazette reported that Hydro-Québec, the province’s energy distributor, has been given approval to charge higher rates to miners and blockchain-based enterprises.
Miners Will Pay Higher Rates
Hydro-Québec presented to the country’s Régie de l’énergie a lengthy proposal which explained their demands in detail, a majority of which received approval. The price increase will be in operation until newer cryptocurrency regulations will be made, the discussions for which are planned for August.
The added rate of 15 cents per kilowatt-hour (kWh), which is double the amount charged to residential consumers, will not be applied to those developers that had agreements with the energy distributor before the rate change.
The Régie de l’énergie stated the following:
“The Régie considers that the rates and conditions … will ensure the security of electricity supply in the particular context of massive, sudden, unexpected and simultaneous demands for the use of blockchain technology, including mining cryptocurrencies.”
Hydro-Québec said that it got 300 new requests for power from mining and blockchain-based companies. This converts to 18,000 milliwatts (mW), which is the equivalent of 40 percent of the capacity the distributor can generate.
The proposal also read that Hydro-Québec could implement these new rates to customers that are categorized as “electricity consumers for cryptographic use applied to blockchains.”
“(The decision) will also allow the distributor to avoid bidding for large amounts of power and energy that may be unnecessary and costly for all customers,” concluded the statement.
Considering the increasing number of mining operations that want to take advantage of the cooler climate and cheap electricity in the northern part of the American continent, energy consumption for mining operations has made authorities worry. The solutions that were initially proposed include the increase of rates for miners, as well as looking for ways to use the “waste energy” derived from mining.
However, there have been many that speculate just how much energy is being consumed for mining. Although everyone agrees that mining requires much more energy than usual household appliances, some experts believe that the studies in circulation present the situation in a negative light when there is not enough research to support them.