The Canadian province of Quebec has reportedly decided to charge cryptocurrency miners up to roughly three times the current price after they flooded utility Hydro-Quebec with requests for mining operations. In addition, several crypto-related proposals have been submitted including one that requires crypto firms to bid for power.
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Price Hike for Crypto Miners
Quebec, a province in eastern Canada, offers one of the lowest power rates in North America. Its electricity is generated, transmitted, and distributed by the country’s largest electric utility, Hydro-Quebec, which was formed by the government in 1944, and currently has over 4 million customers.
The utility has been courting cryptocurrency miners for months to use its surplus electricity. However, due to an overwhelming number of requests for crypto mining operations, the province has decided that it “will make electricity prohibitively expensive for cryptocurrency miners until it figures out how to deal with a surge in demand from the energy-hungry industry,” Bloomberg reported this week, adding:
Provincial regulator Regie de l’energie authorized utility Hydro-Quebec to charge 15 cents per kilowatt hour to blockchain companies, about three times the price they have enjoyed up to now. The temporary pricing doesn’t apply to existing clients and their operations, which total about 120 megawatts.
“Blockchain companies will be required to bid for power and spell out the jobs and investment per megawatt that they will generate,” the utility further proposed. “The starting bid is 1 Canadian cent ($0.0075) per kilowatt hour above the rate the industry had previously enjoyed — roughly a 20 percent increase.”
Furthermore, Hydro-Quebec unveiled a plan Thursday, which requires approval from the regulator, “to allocate as much as 550 megawatts” for crypto mining on top of the 120 megawatts that are already in operation or approved, the publication detailed. A selection process will also be proposed which “will enable Hydro-Quebec to survey the industry on what it considers a fair price and to gauge what investment and jobs the applicants will generate,” a spokesman for the utility, Jonathan Cote, explained.
Overwhelming Demand from Crypto Miners
According to the publication, crypto miners flooded Hydro-Quebec with “requests that it says exceed its short- and medium-term capacity.” Cote told the news outlet on Thursday:
We don’t want to send a message to the market that this is the price for cryptocurrencies in Quebec…It’s more that requests are suspended until we have the proper framework determining conditions for that market.
“The temporary price is expected to be in place for several weeks until the regulator sets a tariff that will then be applicable to all,” the news outlet explained.
Quebec has been trying to attract crypto miners with its inexpensive electricity and cold winters, as news.Bitcoin.com previously reported. However, Hydro-Quebec indicated in January that it will not be able to meet the scale of power demanded by crypto miners. Prior to the rate hike decision, it started turning down new applications for crypto mining operations and considered halting mining operations during winter.
What do you think of Quebec hiking the electricity price for crypto miners? Let us know in the comments section below.
Images courtesy of Shutterstock and Hydro-Quebec.
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