According to the minister, allowing “legal” players to access excess power will be “beneficial” for power providers and miners.
The Russian Ministry of Energy says it is “ready” to grant crypto miners access to surplus electricity “capacity” as the nation’s crypto pivot continues.
Per TASS, the Russian Energy Minister Sergei Tsivilev explained the ministry’s plans on September 5. He was speaking on the sidelines of the Eastern Economic Forum in Vladivostok.
Russian Crypto Miners: Ready for Energy Injection?
Tsivilev claimed that fostering the crypto mining sector was “not a priority” for the Russian government.
But he stated that it would be “beneficial” for miners and power providers alike to allow “legal” players to use surplus power.
“When power plants are operating at full capacity, we are ready to give this surplus energy to miners – but only surplus energy. The miners in question must be legal, and they must pay taxes.”Russian Energy Minister Sergei Tsivilev
Tsivilev said that miners would be able to use this opportunity to leave the unregulated “gray zone.”
He underlined that only “legal” miners signed up to a government-curated registry would be eligible to receive the energy in this manner.
Benefits for Everyone, Minister Explains
However, the minister’s comments appear to suggest that while miners would need to pay taxes on the coins the mine with surplus energy, they may be asked to pay only a nominal amount for the electricity.
“In the case of a surplus […], a power station can operate at 100% capacity. Thus, the economy of the station improves, the Treasury gets tax revenue, and people pay for electricity. It is a beneficial situation for everyone.”
Russian Energy Minister Sergei Tsivilev
Tsivilev explained that “socially significant facilities” and Russian industry “remain a priority in terms of access to power.” He said:
“Mining […] is not a priority for the government. Social development programs and the development of our industry are a priority for us.”
These final statements appear to be intentionally vague. Many miners claim that their industry is helping to create new jobs, develop new capabilities, and train IT experts.
Miners have also claimed their new data centers will be multi-functional, and that the government can use them for nationwide IT projects.
Moreover, a mining association chief told Eastern Economic Forum attendees this week that Russian Bitcoin industry players mined BTC 54,000 in 2023.
The mining chief also estimated that industrial miners could be set to contribute $559 million per year in taxes.
Vladimir Putin said Russia will support US Vice President Kamala Harris in November’s presidential election because she’s been endorsed by President Joe Biden https://t.co/uY5SdklJrs
— Bloomberg (@business) September 5, 2024
However, the government is still unwilling to wholly back the crypto mining sector. Several Russian regions have complained that miners have caused overload problems for their grids.
And President Vladimir Putin earlier this year “noted that the growing electricity consumption for mining” was “fraught with difficulties” for Russia’s regions.
Power Supply Concerns
Power providers are acutely aware of problems linked to crypto mining in nearby Abkhazia and Kazakhstan.
As such, to “regulate these issues,” TASS explained, the nation’s new mining law allows the government to “impose a ban on mining activities in individual subjects of the Russian Federation or certain […] territories.”
It also forbids electric power industry players to directly involve themselves in crypto mining. And it allows individual regions to temporarily ban miners from operating.
Some of Russia’s biggest oil firms have already begun working with miners on pilot programs involving associated gas at drilling sites.