Cryptominers have been scanning the globe searching for the cheapest power suppliers and have settled in a few hot spots. Up-Sate New York is one of those places due to its massive hydroelectric power plants which provide an abundance of low-cost energy. The influx of crypto miners, who according to a New York Municipal Power Agency report are responsible for 33 percent of grid usage in that area, caught the attention of the municipality who, like other regions in the world, see the increased power demands as a reason to hike prices.
Earlier this year, New York authorities cleared 36 municipal power suppliers to charge miners a higher rate than that paid by other customers.
A month ago, Quebec also decided to triple its electricity prices for cryptocurrency miners, but while suppliers are keen to capitalize on the demand and increase prices, local authorities must balance this opportunity with the strategic aim of drawing wider economic benefits to what are often depressed industrial areas.
Now, the State of New York has announced it will work with cryptocurrency miners over electricity costs. Regulators have approved a new rate structure which will allow miners interested in running operations there to negotiate contracts. Municipal athorities will review the contracts individually while shielding the rest of its ratepayers from increased costs.
“We must ensure that business customers pay a fair price for the electricity that they consume,” New York State Department of Public Service Chair John Rhodes said in a statement:
However, given the abundance of low-cost electricity in Upstate New York, there is an opportunity to serve the needs of existing customers and to encourage economic development in the region.