New York Approves New Electricity Rates for Crypto Miners

New York is seeking to foster growth in its cryptocurrency mining sector, with the New York State Public Service Commission (PSC) approving new electricity rates for Massena Electric Department. The new provisions will facilitate “high-density load customers, as such cryptocurrency companies” accessing “individual services agreement tariff[s],” including “protect[ion] […] from increased supply costs.”

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New York Crypto Miners Eligible to Apply for “Individual Service Agreement”

A PSC release states that “cryptocurrency customers and other high-density-load customers will be eligible for service under an individual service agreement if their maximum demand exceeds 300 kW, and the customer provides benefits to the utility. The change allows Massena to recognize potential benefits associated with high-density-load customers, such as increased utilization of currently underutilized transmission and distribution facilities.”

Commission Chair John B. Rhodes described the new rates as “part of our continuing effort to balance the needs of existing customers with the need to attract new companies, we must ensure that business customers pay a fair price for the electricity that they consume,” emphasizing that “the abundance of low-cost electricity in Upstate New York, [provides] an opportunity to serve the needs of existing customers and to encourage economic development in the region.”

The Public Service Commission has stressed the economic benefits that increased investment on the part of cryptocurrency companies could reap for the county, stating that “Massena to receive significant revenues if new cryptocurrency companies set up shop in the community,“ and that in the event of such, “the utility would be required to defer the revenues for the benefit of ratepayers.”

Municipal Utilities Face Increasing Demand From Cryptocurrency Miners

PSC states that “In recent months, several municipal power authorities had seen an increase in requests for new service from new commercial customers for disproportionately large amounts of power. These requests come mainly from similar types of potential customers: server farms, generally devoted to data processing for cryptocurrencies. As a direct result of the intense computer data-processing efforts, these companies are using extraordinary amounts of electricity — typically thousands of times more electricity than an average residential customer would use.”

“While such a significant amount of electricity usage might go unnoticed in large metropolitan areas,” PSC continues, “the sheer amount of electricity being used is leading to higher costs for customers in small communities because of a limited supply of low-cost hydropower.”

The commission describes the creation of the new electricity rates as seeking to “mitigate the impact on existing customers, the Commission has already allowed municipal power authorities.”

Massena’s tariff revisions are scheduled to come into effect from July 17th, 2018.

What is your response to the introduction of individual services agreement tariffs for cryptocurrency miners in Massena? Join the discussion in the comments section below.

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