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The Russian Ministry of Energy stated it is “ready” to grant cryptocurrency miners access to surplus electricity “capacity” as the nation’s crypto pivot continues.
According to TASS, Russian Energy Minister Sergei Tsivilev outlined the ministry’s plans on September 5. He made these remarks on the sidelines of the Eastern Economic Forum in Vladivostok.
Russian Crypto Miners: Ready for Energy Injection?
Tsivilev claimed that fostering the cryptocurrency mining sector was “not a priority” for the Russian government.
However, he stated that it would be “beneficial” for both miners and power providers to allow “legal” operators to utilize surplus energy.
“When power plants are operating at full capacity, we are ready to give this surplus energy to miners – but only surplus energy. The miners in question must be legal, and they must pay taxes.”
Russian Energy Minister Sergei Tsivilev
The Sayano-Shushenskaya Dam, one of Russia’s largest hydroelectric power plants. (Source: Andrey Korzun [CC BY-SA 3.0])
Tsivilev noted that miners would have the opportunity to exit the unregulated “gray zone.”
He emphasized that only “legal” miners registered in a government-curated registry would be eligible to receive energy under this scheme.
Benefits for Everyone, Minister Explains
The minister’s comments suggest that while miners would need to pay taxes on the coins mined using surplus energy, they might be required to pay only a nominal fee for the electricity itself.
“In the case of a surplus […], a power station can operate at 100% capacity. Thus, the economy of the station improves, the Treasury gets tax revenue, and people pay for electricity. It is a beneficial situation for everyone.”
Russian Energy Minister Sergei Tsivilev
The Russian Energy Minister Sergei Tsivilev speaking in the State Duma earlier this year. (Source: Duma TV/Screenshot)
Tsivilev explained that “socially significant facilities” and Russian industry “remain a priority in terms of access to power.” He stated:
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“Mining […] is not a priority for the government. Social development programs and the development of our industry are a priority for us.”
These final statements appear intentionally vague. Many miners argue that their industry helps create new jobs, develop new capabilities, and train IT experts.
Miners have also claimed that their new data centers will be multi-functional, allowing the government to utilize them for nationwide IT projects.
Furthermore, the head of a mining association told attendees at the Eastern Economic Forum this week that Russian Bitcoin industry players mined 54,000 BTC in 2023.
The mining chief also estimated that industrial miners could contribute $559 million annually in taxes.
Vladimir Putin said Russia will support US Vice President Kamala Harris in November’s presidential election because she’s been endorsed by President Joe Biden https://t.co/uY5SdklJrs
— Bloomberg (@business) September 5, 2024
However, the government remains unwilling to fully back the cryptocurrency mining sector. Several Russian regions have complained that miners have caused grid overload issues.
President Vladimir Putin earlier this year “noted that the growing electricity consumption for mining” was “fraught with difficulties” for Russia’s regions.
Power Supply Concerns
Power providers are acutely aware of problems linked to cryptocurrency mining in nearby Abkhazia and Kazakhstan.
As such, to “regulate these issues,” TASS explained, the nation’s new mining law allows the government to “impose a ban on mining activities in individual subjects of the Russian Federation or certain […] territories.”
The law also forbids electric power industry players from directly engaging in cryptocurrency mining. It allows individual regions to temporarily ban miners from operating.
Some of Russia’s largest oil firms have already begun working with miners on pilot programs involving associated gas at drilling sites.
The post Russian Ministry Wants to Let Crypto Miners Have Surplus Electricity appeared first on Cryptonews.
