Russia Considers Selling Power to Kazakhstan Due to Crypto Miner Deficit

Inter RAO, a state-owned Russian energy company, is now discussing electricity supplies for Kazakhstan, where crypto miners are said to have caused a spike in consumption this year. The country expects the power deficit to reach 600 megawatts as demand rises even further during the winter.

Inter RAO, a major Russian electricity producer, is holding talks with Kazakhstan about possible electricity supply beginning in November, according to a high-ranking representative. Alexandra Panina, a member of the company’s management, explained that consumption growth in Kazakhstan is around 7%, noting that the country is experiencing a deficit for the first time during the cold winter months. According to the Interfax news agency, she said:

I am now discussing the possibility of commercial supply of Russian electricity to Kazakhstan in November.

Shortages in Kazakhstan are expected to total 600 megawatts (MW) when demand peaks during the upcoming winter season, with estimates indicating that the deficit may exceed 1 gigatonne (GW) in the future, according to Panina. She also stated that Inter RAO is currently reviewing a request from Kyrgyzstan for additional supplies via Kazakhstan’s grid.

In the midst of China’s ongoing crackdown on the industry, cryptocurrency mining companies have been flocking to the Central Asian country, drawn by its low energy costs. Authorities in Nur-Sultan announced last week that electricity consumption increased to nearly 83 billion kilowatt-hours (kWh) in the first nine months of the year, blaming miners for the increase.

Russia blames supply shortages on Kazakhstan’s thriving cryptocurrency mining industry.

Alexandra Panina identified two major causes of Kazakhstan’s current problems. She believes that the country’s electricity price cap has resulted in insufficient investments in modernizing and upgrading the country’s exciting infrastructure and generation capacity. Then, because of the low cost of electricity, many cryptocurrency miners have moved into the country, which was unprepared for the influx. Miners have become a major issue for Kazakhstan, according to the Russian energy executive.

Imports of electricity are prohibited by law in Kazakhstan unless the national grid operator KEGOC indicates that there is a risk of a power deficit, which is the case right now. As a result, it is possible to obtain electricity from the neighboring Russian Federation.

Earlier this month, during a meeting with Russian President Vladimir Putin, Russia’s Energy Minister Nikolai Shulginov expressed concern about Kazakhstan’s electricity deficit, which is being caused by the energy-intensive extraction of digital currencies, among other unanticipated factors.

Patrick

Coincu News