Cryptocurrency mining navigates a huge amount of electricity. And as the crypto industry gained widespread adoption in recent years, mining activities also increased, leading to lack of electricity in some countries such as Iran and Kosovo.
Similarly, the Norwegian government, which faces the same problems, now plans to remove its previously implicit policy of charging crypto data centers with lower taxes than other industries. Norway’s finance minister, Trygve Slagsvold Vedum, suggested abolishing the scheme that typically affects Bitcoin mining farms operating in the state.
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The minister calls for crypto mining to cause greater demand for electricity
Citing the increase in demand for electricity, the minister added;
We are now in a completely different situation in the electricity market than when the reduced tariff for data centers was introduced in 2016. In many places, power is under pressure, which is causing prices to rise. At the same time, we are seeing an increase in cryptocurrency mining in Norway. We need that power for the community.
The proposal to remove tax subsidies for miners comes after Norway’s finance minister presented the country’s annual budget for 2023. According to his findings, the removal of the reduced tax policy will generate $14 million in revenue.
According to data provided by the Cambridge Bitcoin Electricity Consumption Index, Norway currently generates a global Bitcoin hashrate of 0.74%. A large number of Bitcoin mining centers use 100% renewable energy sources.
Growing Problems of Crypto Mining in Norway
Halfway through the previous month, Bitcoin miners also faced criticism from Sortland, a municipality in northern Norway. Locals cited the environmentally disturbing noise problem from mining and wanted the miners to leave.
In addition, a communist party, the Red Party, also passed a bill in March to completely ban cryptocurrency mining in the country. But fortunately, the suggestion was rejected by parliament in May, as only left-wing parties supported the idea.
Speaking about the rejection of the bill, Arcane Research analyst Jaran Mellerud, pointed out at the time;
Having lost this vote, these political parties will likely make one more attempt to increase the energy tax specifically for miners, which is now the only tool left in their toolbox to make life difficult to cryptominers.
According to an Iranian media report in August, state police confiscated nearly 9,404 mining rigs in districts of Iran’s capital, Tehran. The power blackouts the country faced last summer pushed the authority to track down and seize unregistered mining rigs.
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In addition, Iran had already seized a large portion of the mining farms in June, equivalent to 7,000 mining machines. too disconnect the licensed 118 electrical connection mining rigs to cover the necessary electricity demand during the hottest summer months.
Featured image from Pixabay and chart from TradingView.com
