Washington Turns To Power Price Hikes To Deter Crypto Mining Operations

Authorities in Washington are cracking the whip on the booming crypto mining industry that appears to be taking a toll on the state’s power infrastructure. Reports indicate that the Grant County Public Utility has hiked prices targeting crypto mining operation, which it says are putting a strain on the county's power infrastructure.

A hike in prices follows a yearlong study that showed effects of the crypto mining industry supersede benefits, in addition to putting pressure on the county’s power grid as well as prices. Following a unanimous vote, large power consumers made up of crypto miners will have to contend with a three-year price hike depending on consumption.

The new ‘Rate 17’ entails an initial 15% hike that will come into effect in April of next year. Another 35% increase will come into effect in April of 2020 and then another 50% price will kick in, in 2021.

“For evolving-industry customers who would otherwise be considered residential (former Rate 1), with monthly energy use that averages 5,000 kWh, Rate 17-A would increase the energy charge from an all-in rate of 4.9 cents per kWh to 13.7 cents per kWh,” PUD in a blog post .

For customers with a billing demand of 2MW and a load factor of 92.5%, Rate 17B is to increase from 2.6 cents per KwH to 7.9 cents per KwH. The hike anticipates an average billing demand increase of 5MW at the same load factor.

In defense of the hikes, Grant County Commissioners are essential, to protect the PUD from risks as well as reserve below-cost rates.

Confirming the hikes, Fortress Blockchain Corp which is one of the crypto miners says it will start paying 30.7% more in electricity bills starting April 2019. The company will also incur additional charges on cover up-front costs for lines as well as poles and transformers. Fortress Blockchain says it may be forced to pass the additional power costs to its clients.

Grant PUD has already admitted to receiving inquiries for more than 2,000 megawatts from companies looking to launch cryptocurrency mining operations in the county. The amount of power needed to power such operations is more than triple the amount of power used to power homes businesses as well as industries. It remains to be seen if such entities will still push forward with the applications following power price hikes.