Kazakhstan faces power crunch due to Bitcoin mining, proposes nuclear plant solution
Owing to the Chinese crypto ban, the exodus of Bitcoin miners into Kazakhstan has reportedly contributed to an energy crunch that the Kazakh President has recently proposed solving with nuclear energy. Ministry of Energy for Kazakhstan has recently attributed the 8 per cent increase in domestic electricity consumption in 2021 to Bitcoin miners. The country has received at least 87,849 Bitcoin mining machines brought from Chinese companies till now, following China’s crackdown on crypto mining.
The substantial increase in demand for electricity has resulted in a deficit in the domestic power supply, contributing to unreliable electricity services, as per the Kazakhstan Electricity Grid Operating Company. President Tokayev has told bankers at a November 19 meeting that he opines that building a nuclear power plant would help ease the stress on the country’s electrical infrastructure. Tokayev said that looking into the future, the government would have to make “an unpopular decision” concerning the construction of a nuclear power plant. While Tokayev has not connected the nuclear plant proposal to Bitcoin mining power, it is to be noted that failing to keep Chinese offshore miners in the country could jeopardize the estimated $1.58 billion in tax revenue that those miners represent.
Power shortages have already forced Bitcoin mining marketplace Xive to leave Kazakhstan. Didar Bekbau, the Co-Founder of Xive, has said in a November 25 tweet that he was coerced to shut down his company’s mining farm due to “restricted electricity supply from the grid.” Kazakhstan is now housing a total of 50 registered crypto mining companies and an even high number of unknown, unregistered mining firms. The decision of building new nuclear power plants is a serious one in a country that had suffered severe nuclear fallout due to weapons testing under the Soviet occupation. Kazakhstan’s last nuclear power plant had been closed down in 1999. About 88 per cent of Kazakhstan’s power currently comes from fossil fuel-burning power plants.