After a coal mine accident caused a severe blackout in China’s Xinjiang power grid, Bitcoin’s global hash rate dropped ten days ago. Although the initial estimate showed that the hash rate had dropped by more than 40%, the five-day average statistics showed that the hash rate had only lost about 25%. At the same time, Chinese miners in Sichuan Province may put more pressure on hydroelectric power generation, because provincial officials revealed that electricity prices are planned to increase by 150% this year.
According to a report from the Ministry of Electricity and Trade of Sichuan Province, electricity prices in the region will rise by 150%
Mining Bitcoin is extremely competitive, and miners are distributed all over the world to get the cheapest electricity price they can get. Since the cost of electricity in China is much lower than in many parts of the world, a large number of Bitcoin miners live in China.
A few years ago, it was estimated that more than 65% of the hash rate occurred in China, and recent studies have shown that the concentration has dropped to about 50% of the hash rate.
Following the recent drop in hash rate in Xinjiang Province, a regional report stated that people who use electricity in Sichuan may see electricity bills rise. Financial columnist Priyeshu Garg explained that this year, Sichuan Electric Power, powered by carbon materials, will grow by 150%.
The inspiration comes from the Sichuan Electric Power Trade Department, which disclosed the increased price on April 10, 2021. However, non-mining entities using the Sichuan power grid in the first place may feel this increase because officials want to reduce their reliance on the use of thermal power. Coal mine.
As coal mine electricity prices rise and carbon-based power facilities are decommissioned, demand for hydropower is expected to rise
China’s carbon neutral policy aims to reduce dependence on carbon-based electricity, so that non-mining entities will also be forced to use hydropower. Bitcoin miners in Sichuan are already using hydroelectric power in the area, and the price of electricity per kilowatt-hour is about US$0.02.
Priyeshu Garg said the relatively cheap electricity price of US$0.02/kWh has risen by 16% since last year. A report from the Sichuan Provincial Ministry of Electricity and Trade estimates that by 2021, Bitcoin miners alone will consume 11.3 billion kilowatt-hours.
A reporter from the region pointed out that as the rainy season is approaching, more Bitcoin miners are expected to flood into Sichuan. Therefore, this will increase dependence on all hydropower resources, and if other non-mining entities are competing for this type of power, hydropower may follow the price increase.
The Sichuan Electric Power Trade Office pointed out that the current available hydropower is in short supply.
How do you think the electricity price in Sichuan has risen to 150% this year? Let us know your thoughts on this topic in the comments section below.
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