Kyrgyzstan Raises Electricity Prices for Cryptocurrency Miners – Mining Bitcoin News

The Kyrgyz government recently revised its electricity tariffs for various consumer groups. Authorities in Bishkek have increased the prices at which crypto mining companies buy electricity, citing the energy-intensive nature of the coin minting process.

Crypto miners in Kyrgyzstan pay more for electricity

Companies operating crypto mining facilities in Kyrgyzstan have to pay a higher price for the electrical energy they use to mint digital currencies. The increase follows a government decision to update electricity tariffs across the board to “ensure the stable and reliable functioning of the energy sector.”

According to an official notice, the changes are part of the country's medium-term tariff policy for electricity (2021-2025), which was approved by the Cabinet of Ministers. “Mining Entities (Cryptocurrency)” is one of the 14 groups of end users affected by the revision. The base tariff for consumers in this category is calculated with a multiplication factor of 2.0, as stated in the published documents.

Crypto miners pay 2.52 Kyrgyzstani som (less than $0.03) for every kilowatt-hour of electricity they use. The new rate is the result of a 12.5% ​​increase, government figures show. During the remaining four years of the period covered by the new tariff policy, prices will be adjusted every year to reflect the average annual inflation rate.

Authorities in Kyrgyzstan have listed crypto mining farms as consumers requiring significant electricity supplies, alongside companies in the gold mining industry and alcoholic beverage producers. The revised tariffs for these users take into account the additional operating costs of the country's thermal power plants as well as the costs of distribution, the government said.

The Central Asia region, where the Republic of Kyrgyzstan is located, has become a hotspot for cryptocurrency mining, attracting miners with its low electricity prices. The government in Bishkek has taken steps to regulate the growing industry.

In August 2020, the Ministry of Economic Affairs published a The invoice to introduce a tax on mining activities. The bill imposes a 15% tax on the cost of electricity used to mint digital currencies. The legislation requires mining companies to apply for registration to operate legally in the country.

Do you think Kyrgyzstan will keep its electricity prices low enough to continue attracting cryptocurrency miners? Tell us in the comments section below.

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