All bitcoin mining firms interested in running their operations inside Quebec now have to contend with higher energy rates. This came after Regie de l’energie, the official energy regulator of the Canadian Province gave Hydro-Quebec, the region’s chief utility company the green light to introduce a deterrent tariff.
This is a tariff that will see many cryptocurrency miners paying higher energy rates as compared to those charged to other utility customers and normal households. The new rate for all cryptocurrency miners interested in operating within the province has been set at 15 cents for a single kilowatt per hour.
Ensuring A Consistent Supply
According to the information supplied to the Montreal Gazette, these will be the official operating rates until proper regulations are introduced to monitor the sector. It is, however, important to note that these rates will not affect customers that already had an existing agreement with the firm.
The only miners that will be affected by the new rates will be those that entered into an agreement with the energy regulator after June 6th this year. It is a move aimed at ensuring that there will be a consistent power supply even when the demand is too high.
The Regie is confident that the conditions and rates recently introduced will guarantee electricity security especially during those times when there is a sudden, unexpected, or massive demand for the use of blockchain-based technology, e.g., mining cryptocurrencies.
It is expected that the hearing for the cryptocurrency mining regulations will begin sometime in August. Although Quebec currently has a large surplus of electricity, there have been concerns that the energy utility may not be in a position to meet all the customer needs, especially during times when the demand is at its peak.
This is something that normally takes place during the winter seasons as most households increase their energy use. Currently, Hydro- Quebec is able to produce around 37,000 megawatts.
Since 2016, there has been an increase in the number of companies setting up shop in Quebec to mine cryptocurrency. This came about after the Canadian province started a campaign aimed at luring technology companies to create data centers in the region.
During the campaigns, the province, which happens to have the lowest energy costs in North America pointed out that it had very many hydro resources. From an environmental point of view, this was very compelling.
It, therefore, did not come as a surprise to many people when bitcoin and cryptocurrency miners started to troop to Quebec in large numbers. This number increased significantly at the beginning of the year after reports emerged that China had started cracking down on companies that were mining bitcoin within its borders.
The sustained crackdown on the cryptocurrency miners forced many industry players to start looking for alternatives. In the end, many had to move their operations overseas in a bid to evade further clampdown which was making it harder for them to carry out their operations.