The power grid company of Kazakhstan, KEGOC, announced that it is limiting the supply of electricity to 50 registered mining companies due to a sharp surge in energy consumption in the country.
KEGOC announced that it will limit electricity consumption of 50 registered miners. The decision came after three Kazakh power plants suffered blackouts in October due to a sharp increase in energy consumption by crypto mining enterprises. According to KEGOC, mining enterprises will be the first to get suspended from the power supply in order to prevent power outages for private households. However, later, the Minister of Energy of Kazakhstan Magzum Mirzagaliyev said that Kazakhstani mining farms would not be disconnected from electricity, provided that they comply with the laws of Kazakhstan. Only illegal miners, whose power consumption is estimated at 1.2 thousand MW, will be turned off, he said.
According to the Ministry of Energy of Kazakhstan, electricity demand in the country increased by 8% in 2021, with an average growth of 1% -2% in previous years.
The Kazakh authorities linked a series of power outages to an increase in the number of miners, including unregistered miners, who moved to Kazakhstan after China imposed ban on crypto mining. Kazakhstan is trying to compensate for the lack of electricity, the Financial Times reports. The Kazakh authorities asked Russia to supply energy for export in the amount of 300-400 MW to compensate for the shortage of electricity. In addition, from 2022, Kazakhstan will levy a compensation fee from registered miners in the amount of 1 tenge (about $ 0.0023) for each kilowatt-hour.
According to InBusiness, mining companies in Kazakhstan are thinking about moving to another region and are looking for a place to relocate again.
In October, experts from the University of Cambridge found out that the share of Kazakhstan in the world bitcoin mining increased to 18%, which makes Kazakhstan the second country after the United States in terms of cryptocurrency mining.