- Kentucky authorities investigate implications of cheap electricity to crypto miners.
- Earthjustice
Act to Solve
Kentucky Public Service Commission (PSC) is investigating two proposed contracts that provided cheaper electricity to crypto miners.
A Non-profit public interest environmental law organization, Earthjustice stated that the PSC will investigate if taxpayer money was used to subsidize cryptocurrency mining will raise electricity costs for Kentucky citizens.
As per media reports, “One proposed contract, between Kentucky Power and Ebon International, LLC, would give discounted electricity rates to the Ebon Facility, a 250 MW cryptocurrency mining operation in Louisa, KY. This order follows a similar one opening an investigation into Bitiki-KY, a 13 MW cryptocurrency mining facility in Waverly, KY. Bitki-KY already has a $250,000 tax credit from the state of Kentucky.”
“The burden of these costs often lands on everyday people,” Earthjustice also claimed that crypto mining operations “are highly automated, and rarely create significant jobs.”
Senior Attorney in the Clean Energy Program at Earthjustice, Thomas Cmar, said “I’m hopeful that the Commission will see these cryptocurrency mining companies’ empty promises that they will benefit local communities for what they are, and give more scrutiny to contracts like these in the future. We’re looking forward to the upcoming hearings and discovery process so Kentuckians can know exactly what they would be paying for by subsidizing these facilities.”
Rising Concerns
As per the official website of Kentucky Conservation Committee, almost 20% of the country’s collective computing power is utilized for the Proof-of-Work (PoW) based authentication process which results in an immense amount of CO2 (Carbon dioxide) production, much higher than other states. Crypto mining leaves a Carbon footprint of an estimated 3.3 megatons annually.
According to Foundry, New York houses 19.9% of the total hashrate in the US, followed by Kentucky which houses 18.7%.
Ethereum’s Merge upgraded its blockchain network form the Proof-of-Work (PoW) to Proof-of-Stake (PoS) authentication mechanism. There are calls for the Bitcoin blockchain to convert to the same mechanism since it is the most energy intensive cryptocurrency.
A Bitcoin Mining Council report released on October 18 noted that the BTC hashrate has increased by 73% each year in Q3 2022.
Source: https://www.thecoinrepublic.com/2022/12/06/investigation-over-cheap-electricity-providing-contracts-for-crypto-mining-in-kentucky/