Ethiopia Suspends New Electric Power Permits for Crypto Mining
In a significant move that could shape the future of cryptocurrency operations in the country, Ethiopia has decided to suspend the issuance of new electric power permits specifically for data mining companies. This action effectively halts the growth of crypto-mining activities, attributed to existing limitations in the nation’s power capacity.
The decision comes in the wake of increased interest from the crypto sector, with 25 bitcoin mining enterprises currently active and nearly 20 others pending approval. Many of these companies have been attracted to Ethiopia due to its low electricity tariffs and its vast hydropower resources.
Impact on Local Energy Consumption
The Ethiopian Electric Power (EEP) had previously promoted the sale of electricity to these miners—which is paid for in foreign currency—as a strategy to utilize surplus energy. However, analysts caution that the actual energy consumption by miners might exceed estimates, potentially impacting local electricity availability.
Notably, crypto miners contributed significantly to Ethiopia’s electricity export income, generating $338 million last year, a striking 141% increase from previous earnings.
Challenges in Power Accessibility
Although the country boasts 20 operational power stations and supplies electricity to neighboring nations such as Kenya and Djibouti, around half of Ethiopia’s population remains without access to the national grid. Furthermore, the anticipated launch of the Grand Ethiopian Renaissance Dam (GERD), projected to add 5,000 megawatts to the electricity supply, underscores the pressing need for substantial investment in transmission infrastructure to enhance power accessibility for Ethiopians.
