Power engineers want to turn off “gray” crypto farms in households

According to Vedomosti, the Association of Guaranteeing Suppliers and Energy Retail Companies (GPs and ESCs) has proposed allowing energy companies to cut off illegal miners from electricity in households, garages, garden plots, and also in places where electricity is supplied at subsidized tariffs.

The letter from the GP and ESCO states that illegal mining, even if it is paid for by the household consumer, affects the quality and reliability of the electricity supply to consumers, since the household network is not designed for heavy loads associated with ultra-high power consumption. Therefore, the miners must be connected separately through a grid connection agreement, and not through the household power supply systems existing in households and plots.

The GP and ESCO proposes to introduce the term “domestic electricity consumption” into the Housing Code or the Civil Code, so that it is clear in which case it cannot be carried out for the purpose of making a profit.

Power engineers believe that mining is a commercial activity and, with a “gray” (household) connection, it should be regarded as the misuse of electricity by citizen consumers at tariffs set by energy companies and the state for domestic needs.

The GP and ESC are asking State Duma deputies to include in the Code of Administrative Offenses (CAO) responsibility for the use of electricity for other purposes, as well as for the repeated failure to provide access to power engineers to inspect an electrical installation, for example, a crypto-farm. The association proposes to oblige ISPs to provide IP addresses of miners to electric grid companies and guaranteeing suppliers for reconciliation, analysis of electricity consumption and detection of anomalies in the power supply of households.

According to the Russian Association of the Cryptoindustry and Blockchain (RACIB), at the beginning of 2022, industrial miners in Russia used about 1.2 GW of power. The absolute record of consumption by Russian miners was set in December 2021 – 161.4 GW. RAKIB has estimated that by the end of the year 2022, the electricity demand for miners will grow to 2.5 GW. RAKIB estimated that the total share of “gray” miners does not exceed 15-20% in the amount of energy consumption for legal mining.

In 2021 and early 2022, power engineers revealed illegal connections to power supply systems by the owners of mining farms in many regions of Russia, including Moscow and the region, Dagestan, Smolensk region, Kazan. According to their calculations, electric grid companies suffered tens of millions of rubles in damage in each case, and the total losses across the country could amount to several hundred million rubles in 2021. In most cases, criminal cases were initiated against the owners of large illegal crypto farms under Article 2 of Art. 165 of the Criminal Code of the Russian Federation “Causing property damage by deceit or breach of trust.” They face imprisonment for up to 5 years, as well as a large fine for their deeds.

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