The New Brunswick government is banning N.B. Power from providing electricity service to new cryptocurrency mining operations.
Energy Minister Mike Holland introduced legislation Tuesday that, once passed, would turn what has been a temporary freeze into a permanent legal ban.
The Higgs government quietly issued a moratorium on the utility servicing new crypto facilities in March 2022, after it received several large-scale requests for electricity supply.
“The cryptocurrency sector is an area that has a significant … draw or demand as it relates to electricity,” Holland said.
“We can’t compromise the existing rate base so we need to make sure that we have capacity.”
Hive Blockchain Technologies has a bitcoin mining facility in Saint-André, now part of Grand Falls. (Shane Fowler/CBC News)
Crypto mines are made up of thousands of computers that run 24 hours a day trying to earn units of the cryptocurrency, consuming vast amounts of electricity in the process.
Hive Blockchain Technologies is operating a 70-megawatt bitcoin mine in Grand Falls, and a second proposed facility owned by Chief Fuels won approval, and an electricity supply, before the moratorium went into effect.
The combined annual electricity consumption of the two mines, 96 megawatts, would be close to the yearly generation of the small modular nuclear reactor model being developed by Arc Clean Energy of Saint John.
Put another way, it’s the equivalent of two and a half months of output from N.B. Power’s Belledune generating station.
More crypto mines would put a strain on N.B. Power’s capacity as it faces questions about its generating capacity due to federal climate policies and the age of some power stations.
At the same time, the utility could face greater demand for electricity from a growing population.
Twice this year, in February and July, the utility came close to not being able to meet the demand for power with its existing plants.
“We came very close to the lights not even being able to turn on with the existing generation we have,” Holland said. “We’re at the line right there now.”
Opposition Liberal Leader Susan Holt said it was important for the province to proceed with caution on an industry that uses a huge amount of electricity with very little job-creation impact, but she wanted to know more.
“It’s a slippery slope. If that sector is affected, which others will be and how did they determine that one doesn’t deserve electricity when others do?” she said.
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