The Russian Energy Ministry is looking to have the authority to disconnect crypto miners from energy grids due to Bitcoin miners increasing their capacity. Reports claim that Russian players mined around $3.5 billion worth of Bitcoin last year. The Deputy Minister of Energy mentioned that power providers should be able to sever the connection between miners and power supplies at any time. The Russian Energy Minister also suggested that miners relocate to regions in the country where there is no shortage of energy capacity.
The industry would have the option to self-limit their power usage or use automatic IT solutions based on excess capacity on the grids. President Vladimir Putin recently legalized industrial crypto mining but also instructed the government to find ways to prevent miners from causing chaos in the power grid. Uncontrolled growth in electricity consumption for crypto mining has already caused power shortages in various regions. Traditional Bitcoin mining hotspots such as Irkutsk, Buryatia, and Transbaikal have experienced issues related to power consumption.
Experts estimate that a third of Russian crypto miners operate in regions like Irkutsk and use an average of 1,000 MW, with home-based miners consuming around 130 MW of this amount. However, many miners are now looking to relocate from Southern Russia and Siberia to other parts of the country. For example, developers in Perm have completed a mining farm with a 3 MW capacity in a former fur farm. Gazprom, the oil giant, has also launched a subsidiary focused on crypto mining and is constructing a 500-rig mining farm in Veliky Novgorod.
In addition to these developments, the regional governor of Komi announced plans to build 15 new crypto mining data centers in Russia’s northeast in collaboration with private-sector miners and contractors. The first centers will be located in the settlements of Mikun and Sindor. It seems that the Russian government is making efforts to address the growing energy consumption issues associated with crypto mining to prevent power shortages in various regions. Authorities are encouraging miners to use excess capacity on grids or relocate to parts of the country where energy capacity is not currently strained.
It is clear that crypto mining activities are posing challenges for the energy sector in Russia, with concerns over uncontrolled growth in electricity consumption and potential power shortages in certain regions. The government is taking measures to address these issues by allowing power providers to disconnect miners from energy grids and encouraging miners to relocate to areas with surplus energy capacity. Moving forward, it will be interesting to see how the relationship between the energy sector and the crypto mining industry evolves in Russia.
