Russia to Supply Electricity to Kazakhstan’s Cryptocurrency Miners – Kazakhstan-based cryptocurrency mining operations will be able to fuel their energy-intensive hardware using electricity generated in neighboring Russia. To make this possible, the two partnering nations will change the bilateral agreement governing the coordinated functioning of their energy systems.
According to the crypto news page of the Russian business information portal RBC, the government in Moscow has already ordered the required modifications and initiated preparations to manage the power supply for Kazakhstan’s crypto mining sector. According to the new arrangements, Inter RAO, which holds a monopoly on the export and import of energy in Russia, will be permitted to sell directly to mining firms in Kazakhstan under contracts negotiated on commercial terms.
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After the Chinese government cracked down on the mining business last year, Kazakhstan’s low, subsidized electricity rates attracted numerous mining enterprises. Power shortages and frequent breakdowns in the nation’s aged energy infrastructure were attributed to the ensuing increase in usage. In January, over 200 mining sites were temporarily shut down by Kazakh authorities.
The state-owned Russian energy giant began considering additional supplies to Kazakhstan last fall, when the country anticipated its electricity deficit to reach 600 megawatts due to rising demand during the cold winter months and consumption nearing 83 billion kilowatt-hours (kWh) through the first nine months of 2021.
Inter RAO criticized Kazakhstan’s capped tariffs at the time, stating that they prevented the country from investing in upgrading and modernizing its generation capacities and distribution network. Also, Kazakhstan previously restricted electricity imports until the national grid operator KEGOC found a risk of shortages.
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Lawmakers in Nur-Sultan have lately introduced a law to restrict the “uncontrolled usage of electricity by ‘gray’ miners,” as they described it. The new law aims to restrict the minting of digital currency to mining businesses registered with the Astana International Financial Center (AIFC). Foreign firms would only be permitted to mine under contracts with domestically licensed data centers if the law is adopted.
