Norway Cuts Energy Subsidy Given to Cryptocurrency Miners

  • Norway is reportedly cutting a subsidy on energy it was giving to cryptocurrency miners in the country.
  • This means miners will have to pay standard rates in the country, and could move to Sweden or Denmark.

Norway has reportedly decided to stop giving cryptocurrency mining facilities in the country a subsidy on electricity that was helping them stay afloat during the cryptocurrency ecosystem’s extended bearish period.

According to local news outlet Aftenposten, mining farms in the country had to pay about 0.48 øre ($0.00056) per kilowatt thanks to the subsidy. The price is now set to increase to 16.58 øre ($0.0194) per kilowatt at the beginning of next year. 100 øre equals 1 Norwegian krone ($0.12).

This means that the miners who were receiving the subsidy were paying about 2.8% of the standard rate to power their machines, and may also mean the country can stop being an attractive hub for cryptocurrency miners, which earlier this year were moving to Norway and Sweden over the low electricity-related expenses in the countries.

The move was made with an amendment to the state budget. Commenting on the subsidy’s existence a policymaker from the country’s Socialist Left Party (SV) Lars Haltbrekken, was quoted as saying:

Norway can not continue to provide huge tax incentives for the most dirty form of cryptographic output as bitcoin. It requires a lot of energy and generates large greenhouse gas emissions globally

According to reports, cryptocurrency mining farms in Norway were being able to mine BTC at a price of about $7,700 per coin – significantly above the flagship cryptocurrency’s current market price of about $4,381.

Per Afterposten Roger Schjerva, a chief economist of local tech interest organization ICT Norway, criticized the move and claimed it was “shocking” that the state budget approved it without “discussion, consultation or dialogue with the industry.” Per his words, the government is “playing a gambling role with its credibility” with the move.

Schjerva further argued that removing the subsidy will see Norway’s cryptocurrency miners move to Sweden and Denmark, adding he hopes “politicians understand that energy-intensive computing is one of the things we will be living [with] in [the] future.”

As CryptoGlobe covered, Norway entertained the idea of launching its own cryptocurrency earlier this year, as it would be a “supplement to cash” circulating in the country, and “another way to make bank deposits.” It would also be used as an additional form of electronic payments.