Tuesday, November 30, 2021

Kazakhstan faces power deficits due to increased crypto mining operations.

The Takeaway:

As Chinese crypto miners migrate to Kazakhstan, this poses capacity challenges to the Kazakhstan grid as the country faces power deficits.

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Chairman of AB Inter RAO Lietuva board Alexandra Panina has voiced her concern regarding Kazakhstan’s energy deficit. As crypto miners from China migrate to Kazakhstan, this poses capacity challenges to the Kazakhstan grid, which could be supplemented by the Kremlin’s state-owned utility Inter RAO in the near future. Inter RAO is the state-owned electricity utility in the Russian Federation with which Kazakhstan authorities are in talks to supplement Kazakhstan’s electricity deficits.

 

Kazakhstan is home to many global crypto mining farms. 

Kazakhstan has a cap on electricity prices, which has led to aging infrastructure and generation capacity. This, however, has attracted miners to the country, increasing the total consumption to 83 million kWh from January 2021 to September 2021, for which the country was ill-prepared, according to Panini. Panini has further opined that Russian electricity exports should have a higher tariff. The Central Asian country is home to mining farms run by BIT Mining, Canaan, KazDigital, Xive, amongst other companies. Regions in Kazakhstan that play home to mining operations include Karaganda, Pavlodar, Taraz, and Ekibastuz.

 

The Central Asian country is looking to improve its infrastructure. 

By law, Kazakhstan cannot procure energy from international sources unless a deficit exists. According to Panini, the country is expected to experience a shortage of 600MW in the upcoming winter, and estimates could exceed 1GW in the future. In addition to procuring power from the Russian Federation, the Kazakhstan energy minister Magzum Mirzagalieve recently outlined three new investments in the country’s power grid, state-owned power company Samruk Energy plans to rehabilitate a 4000MW coal plant. President Tokayev said that Kazakhstan is in need of a nuclear power plant. Panini has opined that Russian exports should have a higher tariff.

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Disclaimer: The article reflects the opinions of the author and is not representative of Chaintimes’ views.
The article does not offer any investment advice. User discretion is advised when investing in or trading with cryptocurrency. Extensive and diligent research should be carried out by the reader before making a decision.

Jai Pratap
Jai Pratap
A Mass Media Graduate who loves to write. Jai is also a sports enthusiast and a big movie buff. He loves to learn new things.

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