Mining cryptocurrencies like bitcoin in the state of New York will become more expensive as power providers are now cleared to charge higher electricity rates for crypto mining firms. In a ruling [PDF] on Thursday, the New York State Public Service Commission – the state’s public utility regulator – has allowed upstate municipal power authorities to charge higher power tariffs for companies in the crypto-mining business with high-density loads, from March.
An energy-intensive process, cryptocurrency mining is a process wherein miners are rewarded with coins for creating blocks of validated transactions and adding them to a blockchain using specialized computer chips that draw high amounts of power continually. The move follows a petition by the New York Municipal Power Agency (NYMPA), a group of 36 municipal power providers in the state, citing concerns of higher electricity costs for residential and business customers due to soaring demand from crypto-mining companies. ‘The addition of high-density load customers can drastically increase the amount of supplemental power needed by the systems and significantly increases costs to existing customers,’ an excerpt from the announcement read. The petition also argued that cryptocurrency miners ‘do not bring the economic development traditionally associated with similar load-sized companies’ with fewer jobs and ‘little to no capital investment’ among the local community.