Quebec Crypto Miners Forced To Bid For Power As Part Of New Measures

Authorities in Canada have moved to regulate the amount of power that entities can use in cryptocurrency mining operations.  Provincial utility Hydro- Quebec has issued a new set of rules that blockchain companies will use to bid for electricity. The rules are in response to an Order-in-council adopted by the government.

The new parameters are intended to maximize economic spinoffs for Quebec as well as revenue for Hydro-Quebec.  Electricity rates of normal customers are also expected to go down as a result. Under the new rules, blockchain companies are to bid for power and at the same time spell out the number of jobs they will create because of their operations.

The blockchain companies are also required to spell out the investment per megawatt they will generate. The starting bid is set at 1 Canadian cent (0.0075) per kilowatt per hour, which is slightly above the rate that the companies were paying.

Under the selection process, bidding price will account for 70% of the total score in the ranking of applications. The measure is set to favor companies with substantial financial muscle and those that are ready to start operations immediately.

The proposed new parameters still need approval by regulator Regie de L’energie which is also set to allocate 550 megawatts in addition to 120 megawatts in existing initiatives.

“The goal of this process is to both maximize economic spinoffs for Quebec and revenue for Hydro-Quebec -- in turn, pushing electricity rates down for customers,” Canada’s most significant utility said in a statement.

The new power bidding parameters come at a time when Hydro-Quebec has found itself flooded with power supply request exceeding its short and medium-term capacity.  The company has been forced to charge a temporary and prohibitive price as it seeks to curtail an influx of new power requests.

The development follows a series of changes in the recent past that has seen the Quebec Government go to great lengths in a bid to curtail blockchain companies looking to take advantage of the cities low power rates. In March, the government made it clear that it is not ready to offer cheap electricity to miners without getting anything in return.

However, in May, the government hinted at the possibility of lifting a moratorium in the sale of power, as a way of trying to offer reprieve on the digital currencies mining business.