Cryptocurrencies are generated through a process known as crypto-mining that consumes a lot of electrical power. And higher energy consumption has consequently brought electric power shortages in various regimes due to increased mining activities.
Quebec, a Canadian province, faces similar problems. And now the provisional energy supplier wants to cut power sources so miners can survive in the winter when the minus-degree temperature requires residents to use heaters and other electrical appliances to survive.
In this regard, the power management firm Hydro Quebec, which controls, generates and distributes electric power across the Quebec province of Canada, submitted a report to the energy board on November 1. The distributor in the report asked the government to limit the hydroelectric power plant to supply energy to crypto miners.
Citing the reason behind the need to reduce power for crypto mining operations, Hydro Quebec expressed concerns about the “reliability and security” of power for residents in Quebec. Furthermore, the firm has already considered the demand for electric power through cryptocurrency, greenhouse farming and green hydrogen.
Following Hydro-Quebec’s request, Pierre Fitzgibbon, a Canadian politician and legislator, tweeted on November 3 to express his favor with the request of Hydro Quebec.
However, he said that the government will ask the energy board to release the platform from its obligations to supply energy to crypto mining farms. The firm allocates 270 MW of electricity to mining platforms per the current liability. In addition to this amount of electricity supplied, the energy demand in the crypto sector continues to increase, putting pressure on the energy supplier.
Power demand for Crypto mining will continue to rise
The report uncovered that the demand for energy for crypto-mining activities will continue to grow as digital assets gain more ground daily. As per the Growth in electricity demand will continue in Quebec report, peak mining energy demand stands at 0.7 terra watt hour (TWh) in a ten-year time frame, expected to occur in 2028.
The additional energy needs in winter are high, and this, without the addition of the load related to the balance of the block reserved for cryptographic use applied to blockchains. There are expected energy purchases of almost 3 [terawatt-hours] in winter from 2025 and even more than 3 TWh in 2027.
In addition, mining companies in the regime have been paying extra taxes on their operations to the Quebec government since March 2021. Although the government seeks to control the load on the power grid, it also offers options to expand the mining business.
Quebec province does not appear to be the first to experience problems managing electricity due to crypto mining. For example, Kosovo and Iran faced an energy crisis. The Iranian authorities became particularly aggressive when they saw the critical issues and a previous report revealed that the police had confiscated more than 9,000 mining machines until August.
Featured image from Pixabay and chart from TradingView.com