Washington state’s Chelan County is proposing a higher electricity rate for cryptocurrency miners.
According to a KPQ report published November 14, Washington state’s Chelan County Public Utility District (PUD) has recently submitted a proposal outlining a new rate structure for levying electricity charges to cryptocurrency mining operators.
Explaining the newly introduced rate proposal, Chelan County’s Customer Utilities Rate Adviser Lindsey Mohns stated that:
This rate structure is built the same way as the existing rate structure that cryptocurrency miners are paying right now, which is referred to as Schedule 35. What this new rate structure does is brings into it a market consideration on the energy price because we will have to purchase power on the market to serve the variable load associated with cryptocurrency.
Mohns went on adding:
Our upfront capital charges are intended to recover the accelerated cost of infrastructure investment in our system, mainly in our substations, which is kind of the main component of the distribution system. So the upfront charges take into account the capacity that’s used by cryptocurrency miners.
The unveiling of PUD’s new structure was attended by a number of crypto mining operators, including Firefly Technologies and Silicon Orchard co-founder Denton Meier who stated:
I think it’s nice to be able to make comment but it seems like they’ve already made up their mind. What’s been missing is actually a round-table discussion and more of a brain storming session. How can we really affect the local economy, how can we work together? Let’s create a business-case scenario and include the PUD in that.
Meier went on stating that the approval of the new rate structure could possibly result in a mass exodus of crypto mining operators, adding that:
Looking at it in a bigger picture it’s not just mining but services that can happen around that. Like jobs creation in programming, finance, and other things that will happen over time with the cryptocurrency market. We have the opportunity to become a hub for that. With rates that price us out of that ballgame, it’s not that root that we need to then grow those other businesses, so that will happen elsewhere.
While Mohns doesn’t necessarily believe that a mass departure is on the horizon as this would have probably already happened during PUD’s previous meetings, veterans in the crypto sphere have long had a history of migrating to other more crypto-friendly jurisdictions, including crypto exchanges that have previously relocated in other countries due to regulatory uncertainty.
How crypto mining operators will respond to Chelan County’s newly proposed rate structure remains to be seen.