Earlier in the year Canada’s Quebec province made efforts to attract miners of virtual currencies by offering them abundant hydropower at a low cost. Initially the Canadian province claimed to have surplus electricity amounting to about 5,000 megawatts generated by Hydro-Quebec, the state-owner hydroelectricity generator. Now the utility company is calling for sanctions to be imposed on miners of virtual currencies especially during the winter months when it is dry.
“In Quebec, residential customers heat their homes with electricity … We are now analyzing the effect of the blockchain on our winter peak. One of the solutions could be to oblige blockchain companies to suspend the activity during the winter,” said a Hydro-Quebec spokesperson, Marc-Antoine Pouliot.
Complex math equations
The mining of virtual currencies such as bitcoin (BTC) needs high-powered computers to operate continuously as they seek solutions to complex math equations. These computers also generate a lot of heat and thus require cooling and this makes the mining of digital currencies highly energy intensive. Quebec enjoys one of the cheapest hydroelectricity rates in North America and this part of the reason why it has become attractive to miners of virtual currencies.
Hydro-Quebec has admitted that cryptocurrency miners have inundated it with requests. Per its estimates about a quarter of the electricity in Quebec would go to mining of cryptocurrencies if it accepted every application.
Some of the municipalities in Quebec are already slapping virtual currency mining operations in the province. One of the latest municipalities to do this citing the strain the miners are placing on the supply of cheap electricity in Quebec is Magog. Earlier this week elected officials of the municipality voted with a view to withholding approval to future cryptocurrency mining ventures.
Digital currency mining firms BitLinksys and Bitfarms are scheduled to unveil operations in buildings that were formerly occupied by factories in Magog. Their combined consumption of electricity on a daily basis is 20 megawatts. This has seen Magog seek the help of Hydro-Quebec in upgrading its electricity grid in order to accommodate the bitcoin miners. The aim of placing moratoriums on future virtual currency mining ventures is to spare the excess electricity supply for other sectors in the economy.
So far 21 municipalities that are part of the regional council of Brome-Missisquoi have placed a moratorium on future digital currency mining operations. Also in March the regional council gave approval to a ban of three months which prohibits the expansion or creation of virtual currency mining businesses in the area under its jurisdiction.