Canada’s Manitoba province has set an 18-month moratorium on new crypto-mining operations, citing the possibility of the local grid being overwhelmed by new projects.
After the recent decision adopted in New York, a Canadian province, Manitoba, is taking a similar direction. Manitoba is temporarily limiting new cryptocurrency mining projects due to the potential increase in demand for electricity.
According to official reports, the provincial government has established an 18-month moratorium for new operations related to cryptocurrency mining. Thus, they intend to anticipate a possible collapse in the local energy network due to the high consumption of mining projects.
As reported, the measure will not affect existing projects. The aim is to stop new requests for this type of operation in the town, preventing more miners from connecting to the electricity grid. This is so due to the potential negative impact it would have on the community.
At least 17 new operators have filed applications with Manitoba authorities for a total of 370 megawatts of electricity. That exceeds half of the energy produced by the hydroelectric plant that feeds that province and that came into operation this year.
Manitoba is an attractive location for miners due to its cheap energy. Powered primarily by hydroelectric sources, the province has the lowest electricity rates in Canada, after Quebec.
Manitoba Government Questions
The suspension is scheduled to last for a year and a half, ending in 2024. It will not affect the 37 currently active mining operations in the province, according to reports.
Speaking about the decision, Manitoba Finance Minister Cameron Friesen, the government official responsible for state-owned Manitoba Hydro, argued that the often-reduced number of jobs created by these types of operations does not justify the high spending on energy:
“We can’t simply say, ‘Well, anyone can take whatever [energy] they want to take and we’ll simply build dams’. You may be using hundreds of megawatts and have a handful of workers. Manitoba Hydro cannot make discretionary decisions about whom to connect.”
A government review is expected to look at the economic impact of cryptocurrencies and the need for a regulatory framework to approve large new connections to the network, though no timetable is detailed.
The New York Antecedent
In the United States, the New York government enacted a two-year moratorium on PoW mining last week due to concerns about its environmental impact.
For the next two years, only mining based on 100% renewable energy will be allowed in New York. Four months ago, the New York Senate approved a bill that aimed to regulate in a similar way, as an effort to address some of the environmental concerns surrounding cryptocurrency mining.
By Audy Castaneda
