Town cheers Bitcoin mine shutdown, power prices increase 20%
Residents of norther Norway town Stokmarknes celebrated the closure of the local noisy Bitcoin (BTC) mining facility, but local power costs increased by 20%.
According to a recent report by local news outlet NKR, the mining facility operated by Kryptovault used loud air-cooling systems which led to neighbors complaining. Local citizen Harald Martin Eilertsen told reporters:
“We had to close our windows at night just to sleep.”
Stokmarknes is in the far north of Norway.
Unexpected consequences
While the citizens were happy to be able to sleep in silence once again, they found that silence had a price: the local power costs increased by 20%. The mining facility was the largest customer of local energy provider Noranett — being responsible for 20% of its revenue.
After the mining firm declared bankruptcy in September last year, Noranett decided to pass the financial burden of power distribution on to the local power consumers. The power firm announced that the power price hike will be implemented next month.
The shutdown comes shortly after the Norwegian government introduced new regulations regulating data centers and crypto mining operations. The bills — still being discussed and not yet in force — would require such operations to register their operations and allowed authorities to limit their scope.
Digitalization Minister Karianne Tung explained that Norway is willing to attract data centers that develop the local infrastructure, but not those that deplete its energy resources. Energy Minister Terje Aasland also said:
“[Crypto mining] is an example of a type of business we do not want in Norway.”
If the law passes, local cryptocurrency mining operations could face major hurdles in the region, potentially being forced to relocate elsewhere. Even for operations that end up on the regulator’s good side, the new laws would increase compliance costs and decrease profitability.
As ReadWrite reported back in late April, cryptocurrency miners were recently stockpiling near-record amounts of Bitcoin, presumably hoping the token will rise in value and offset a drop in new supply that will cut the rewards for verifying transactions in half.
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