Two firms mining cryptocurrencies have topped a list of the largest consumers of electricity in Georgia. In this crypto-friendly state, however, that is not always a sin or a drawback. Energy-intensive enterprises from the Caucasian country purchase the power they want at wholesale prices.
Georgia is one of many jurisdictions in the post-Soviet area which have been attracting crypto miners with lax regulations and comparatively low operating costs, including the price of power which is a major investment in the company of minting digital coins. Reports earlier this year have suggested that the country ranks second only to China in terms of mining profitability.
Two Georgian mining companies — Geo Service and BFDS — have been included in a list of five largest consumers of electricity which also comprises the metallurgical firm Nordic Manganese, the utility company Georgian Water and Electricity (GWP) and Kutaisi Investments. What’s more, the crypto companies are leading the group mentioned in a report about Georgia’s projected electric power balance for 2019, Business Gruzia reported.
Based on government data, both mining companies have used a total of 55.6 million kWh in the month of November. And for a period of seven months, Geo Service has consumed almost 108 million kWh, while BFDC Georgia, a company owned by the mining hardware maker Bitfury, used another 339 million kWh.
All the five companies run energy-intensive facilities. And in Georgia, these enterprises purchase the power they need on a separate, wholesale market and straight from producers and importers. This allows them to bypass the distribution utilities which charge extra fees. Based on Georgia Today, these intermediaries will increase the tariffs for other groups of consumers in January, following approval from the Georgian National Energy and Water Supply Regulatory Commission.
According to the electric power balance file, the electricity consumption of the whole country during the next year is anticipated to reach 14.2 billion kWh.
The forecast published by the Sarke news bureau proves that In 2019 Georgia’s own electricity generation capabilities will produce up to 12.7 billion kWh, while the imported power will sum to 2.8 billion kWh. The nation is heavily reliant upon its own hydroelectric power stations which can generate around 10.3 billion kWh, with thermal power stations projected to produce 2.3 billion kWh and the Kartli wind park — 86 million kWh.
Mining for a business and a source of income has gain popularity in the entire Transcaucasian area. Bitcoin farms have spread so fast in Abkhazia, a breakaway territory in northwestern Georgia, the local government was forced to introduce temporary power cuts for the miners during winter. Georgia and Abkhazia share a massive hydropower complex located on the de facto boundary, which under ordinary circumstances satisfies most of the needs of the partly recognized republic.
Neighboring Armenia has taken steps to legalize and regulate cryptocurrency mining. This year the nation became home to a massive mining center with 3,000 apparatus caked bitcoin and ethereum. Its owners, the Armenian consortium Multi Group and the Swedish company Omnia Tech, strategy to expand its capacity to 120,000 machines.