According to a ruling announced by the New York Public Service Commission on Thursday (March 22), cryptocurrency miners who purchase electricity from certain New York power companies will face a new tariff on electricity since March 23. The commission approved 36 northern municipal utility companies to impose additional fees on companies with a maximum electricity demand of more than 300 kWh.
Just a few days ago, the City of Plattsburgh, New York, where the two bitcoin mining companies were located, also approved an 18-month cryptocurrency mining ban to maintain its electricity supply.
Shone Anstey, CEO and co-founder of Blockchain Intelligence Group, a cryptocurrency analysis company, said that measures to increase electricity costs and limit cryptocurrencies may be part of the local government’s development trend. These local governments hardly see the company’s economic benefits.
He said that compared with other companies that consume large amounts of energy, mining companies provide relatively few taxes and relatively few employees.
Anstey stressed: “Whether or not you want to, every municipality needs to make up its mind. If they don’t do that, it doesn’t matter. Some cities have a lot of electricity.”
In addition, he also believes that mining companies are likely to move to areas where electricity is cheaper, such as Alberta, Canada. Electricity is like a security mechanism for cryptocurrency networks. If you want to attack the bitcoin network, you must have more power than a small country.
One third of the electricity
Cryptocurrency mining is a process in which individuals or groups get paid by running complex mathematical equations on high-performance computers using cryptocurrencies to confirm the validity of transactions.
Municipal power companies, members of the New York City Power Company, have asked the state government to allow tariffs. Because they said that the miners used too much cheap electricity to customers.
According to the committee, in some cases, a mining company’s electricity consumption can account for one-third of the total electricity of municipal utilities.
The chairman of the committee, John B. Rhodes, said in a March 15 statement:“We must ensure that business customers pay the right price for the electricity they use. It’s very particular in small communities with limited low-cost electricity. If we do not take action, existing residential and commercial customers in the northern communities served by the municipalities will see a significant increase in their utility costs.”
Willing to pay fair share
David Bowman, founder and CEO of Plattsburgh BTC LLC, said he supports the ruling.
He said:“People chose Plattsburgh because of cheap electricity, cold weather and universities. No one tried to raise the price of their urban residents.” In addition, he said: “Miners are happy to pay their fair share to ensure that taxpayers do not subsidize their operations.”
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