A new electricity rate scheme for cryptocurrency miners has been approved by New York state regulators. Now miners will pay more than average consumers.
State regulators in New York allowed a municipal utility provider to implement a new set of electricity rates for cryptocurrency miners.
A new rate structure for one upstate utility has been already approved by the regulators which means that now crypto miners who are interested in conducting operations there will pay for the consumed electricity at new rates, different from those that are introduced to other customers.
Massena’s municipal utility will consider contracts on a case-by-case basis with a view to protect other utility customers from overpaying for electricity. So, already in the near future, high-density load customers, such as cryptocurrency companies, will receive services under an individual service agreement.
Just four months ago, New York regulators informed all the municipal power authorities about the necessity to introduce higher rates for crypto miners in comparison to the rates that are paid by other customers. And now these instructions are being implemented.
Though such a decision may discourage some cryptocurrency miners hoping to take advantage from cheap hydroelectrical resources located in New York to set up their activities there, according to the authorities, they are trying to find a balance between introduction of “fair” prices and efforts to attract business to the region.
“We must ensure that business customers pay a fair price for the electricity that they consume. However, given the abundance of low-cost electricity in Upstate New York, there is an opportunity to serve the needs of existing customers and to encourage economic development in the region,” said New York State Department of Public Service Chair John Rhodes in the official statement.
New York has always been known for cheap electricity rates that were introduced due to its abundance of hydroelectricity. In Massena, residents pay approximately $0.039 per kilowatt hour, while the average residential rate across the country is nearly $0.13 per kilowatt hour. That’s why, it is quite natural that the state boasts great popularity among crypto miners who use powerful computers that are able to solve complicated calculations and as a result consume a lot of energy.
Over the past years, regions rich in hydroelectric power have experienced a huge influx of miners. Nevertheless, with a view to resist it such regions have started to impose bans on the industry or introduce higher power prices for everyone. That’s why some authorities, including New York regulators, are trying to find the golden middle between their desire to attract new companies and to protect their residents from high costs.
In June, Quebec’s government took a decision that was not so categorical as in China, where mining is banned, but still was rather severe. They decided to triple electricity prices for cryptocurrency miners.
At the same time, quite opposite news came from the Swiss Alps. Swiss Alps Energy (SAE) decided to allocate thousands of unused premises in the Swiss Alps for mining in order to cut the cost of the process and make it more eco-friendly.
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