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Iranian authorities plan to pull the plug on licensed crypto mining facilities as the country’s power consumption reaches record highs. The Islamic Republic’s Energy Ministry announced Wednesday that mining farms will be disconnected from the grid.
Iran’s legal crypto miners shut down operations again
due to power shortages.
Iran’s authorized crypto mining companies will have to unplug their power-hungry coin minting equipment starting Wednesday, June 22, or the beginning of Tir, the next month of the Iranian calendar. Mostafa Rajabi Mashhadi, a spokesman for the Ministry of Energy, announced the decision, quoted by the Tehran Times.
The government official noted that the measure applies to the 118 licensed mining sites currently operating in the Islamic Republic. The temporary restrictions will be imposed after the country’s electricity consumption reached a record high of 62,500 megawatts (MW) during peak periods last week.
Mashhadi added that according to the local calendar, electricity demand for the week ending Friday is expected to exceed 63,000 MW. Energy Ministry officials consider this figure significant and warn that it will lead to restrictions on electricity supply throughout the country.
Tehran authorities legalized cryptocurrency mining as an industrial activity in 2019. Since then, dozens of companies have applied for licenses from the Ministry of Industry to begin extracting digital currency using the low-cost energy provided by Iranian power plants.
In addition to licensed mining operations, a growing number of Iranians are using subsidized household electricity to install mining equipment and mint digital coins, further increasing the strain on Iran’s power generation industry. The latter is facing serious problems due to drafting caused by lower-than-expected rainfall and increased demand during hot months; a May report revealed that Iran has uncovered about 7,000 illegal crypto farms.
Last summer’s power shortages and frequent blackouts were partially blamed on increased power usage for mining, and even licensed miners were ordered to shut down. They were allowed to resume activity in September, but were then asked to shut down again in the face of increasing power shortages during the cold winter months.
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