By Nadia Ramlagan
Public News Service
Foreign-owned crypto mining companies are staking out Eastern Kentucky for cheap electricity, and the state’s major utilities want to give them discounted rates on their electric bills.
Critics warn crypto mining, which creates digital currency like Bitcoin, is an energy-intensive industry, putting stress on electric grids.
Thom Cmar, senior attorney for EarthJustice, said there is little track record of the companies’ impact on local economies, but they tend to employ a small number of people and siphon a massive amount of power.
Overall, 86% of Americans say they have heard about cryptocurrencies, according to a 2021 Pew Research Center survey, but only 16% say they’ve used or traded any. (Image from Adobe Stock, via PNS)
“These facilities are essentially these large warehouses full of computers, that are plugged into the grid all day and trying to run these computations in order to earn Bitcoin and other cryptocurrencies,” Cmar explained.
The Kentucky Public Service Commission will hold a hearing this week on Kentucky Utilities’ proposed special rates for the crypto company “Bitiki” seeking to build a plant in Union County. In a separate case, Kentucky Power and Kentucky Utilities propose special rates for another company, called Ebon, to build a plant in Lawrence County.
Under state law, utilities are allowed to offer special rates as an incentive for businesses. Supporters argued the intention of an incentive is attracting companies to bring jobs and other economic benefits to the utility’s service area.
Josh Bills, certified energy manager for the Mountain Association, pointed out Eastern Kentucky residents have been hit the past few years with rate increases and fuel surcharges. He said he is worried if the companies go belly-up after wearing out the grid, ratepayers might be left footing the bill.
“We just want to make sure that the electric bill gets paid if this doesn’t pan out, if they ramp up and a year later have to close shop,” Bills stressed. “We just want to make sure that none of that electricity that was consumed is not paid for.”
He added utility companies could instead be channeling resources toward building renewable energy capacity, since tax credits currently available from the federal government would help offset costs.
