Bitcoin mining, or the use of specialized computers that record and verify bitcoin transactions, is notoriously energy inefficient, using up to an estimated 20,000 gigawatt hours of electricity per year. That’s roughly .1% of global generation. So, when bitcoin mining companies realized that a few Washington state counties had extremely low electricity rates, mining companies moved in. But now, utilities in Chelan and Chelan counties are raising rates for these companies.
According to The Herald, Grant County Public Utility District commissioners adopted a new rate in early September for so-called mining operations. Commissioner Tom Flint told some miners that their industry is risky and unregulated, and he wanted to make sure other ratepayers were protected.
In Chelan County, the proposed cryptocurrency rates work out to around 8.5 cents per kilowatt hour for home-based miners and slightly over 6 cents per kilowatt hour for commercial and industrial operations, according to KUOW. Those new electric rates are about double the regular residential and commercial rates and would take effect April 1, 2019.
In Grant County, Washington, the so-called "evolving industry" rate will roughly triple current electric bills. Grant PUD commissioners voted unanimously late last month to phase in the new rates beginning April 1, 2019.
In August, the US Committee on Energy and Natural Resources has planned a hearing on the topic of energy efficiency in blockchain in an effort to better understand how such technology might impact electricity prices, according to coindesk.com. The hearing took place Aug. 21.
According to the committee’s website, in his testimony, Dr. Robert Kahn, president and CEO of the Corporation for National Research Initiatives, reflected on what blockchain could mean for the electric grid and energy systems at risk for cyberattacks.
“We had a similar challenge facing us in creating the Internet, where it was not practical to cause every existing network to change,” Kahn said. “I believe the kind of workaround strategy we used in creating the Internet is implementable in the energy grid with only a small amount of help from industry, and (importantly) without requiring significant reworking of their existing industrial control systems.”
Dr. Arvind Narayanan, associate professor of computer science at Princeton University, also spoke to the cybersecurity implications of blockchain.
“Blockchain technology brings potential benefits as well as risks to the cybersecurity of energy systems,” Narayanan said. “It is not essential for achieving the foundational components of digital security, and policy makers should view it as one of several possible technical tools for addressing energy cybersecurity.”
