Kentucky To Investigate Contracts Providing Cheap Power To Miners
According to reports, Kentucky Public Service Commission (PSC) is allegedly investigating two proposed contracts. These contracts aim to offer cheap electricity tariffs to new crypto miners in the US state.
Earlier in the week, Earthjustice, an environmental law group, released a statement revealing that the department would evaluate the effects of subsidizing crypto-mining activities on Kentuckians.
Some advocates believe that this would increase the electricity bill of residents. Two mining contracts are currently under investigation. They include one between Ebon International LLC and Kentucky Power.
The second is between Bitki-KY and Kentucky Power. Ebon International LLC operates a 250MW mining station in Louisa and Bitki-KY, a 13MW station in Waverly.
Per the contract, Ebon Facility will receive discounted power prices. On the other hand, Bitki-KY received a tax credit of $250,000 from Kentucky after the state’s recent tax break legislation for local cryptocurrency miners.
According to Earthjustice, crypto mining is an energy-intensive process by nature. Therefore, the agency believes discounted rates on mining facilities could increase the electricity bills of Kentuckians.
Meanwhile, Thomas Cmar, a senior attorney at the group, said he looks forward to the forthcoming hearings. Cmar noted that Kentuckians need to know how subsidizing mining operations would affect them.
“I believe the Commission will see through the empty promises of these crypto mining firms that their operations would benefit the people. I expect the Commission to scrutinize such contracts in the future properly,” he added.
The senior attorney said that the crypto mining sector is highly unregulated and energy-intensive. Hence, he argued that their activities would affect Kentuckians in the long run.
Kentucky, A Hub For Crypto Miners In The US
Furthermore, the group alleged that cryptocurrency mining firms do not create many employment opportunities. This is because mining operations are highly automated and need less workforce.
Lane Boldman, Kentucky Conservation Committee Executive Director, said developing new crypto mining stations is a huge burden. According to him, the electricity bill of the commoner would rise to pay for the cost.
Meanwhile, Kentucky has recently become a hub for crypto mining firms. These miners account for over 20% of the nation’s computing power, which they use for their mining activities.
Besides, a CNBC report ranks the state second after New York among American states in mining activities. However, several environmental groups have called for a ban on PoW crypto mining, citing energy concerns.
They believe BTC and other PoW blockchains can move to the PoS consensus mechanism as Ethereum did in September. Recently, the Bitcoin Mining Council, in a report, said that methane gas could be used to mine Bitcoin.
The report added that this could make Bitcoin a “zero-emission network.” Although Ethereum has moved to the PoS consensus mechanism, it is unlikely that Bitcoin would follow suit.
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