For the First Time, a US City Has Banned Cryptocurrency Mining (businessinsider.com)

CaptainDork writes: The city of Plattsburgh, New York is imposing an 18-month moratorium on commercial cryptocurrency mining. The official reasoning for the moratorium is to "protect and enhance the City's natural, historic, cultural and electrical resources." Plattsburgh residents have seen skyrocketing electrical bills -- as much as $100 to $200 increases -- as a result of commercial cryptomining operations that mine for cryptocurrencies like bitcoin, according to Plattsburgh Mayor Colin Read, who spoke with Motherboard. The city is taking action to protect its citizens from those rising electrical bills that the city of Plattsburgh says is caused by cryptomining operations.

It turns out that commercial cryptocurrency mining operations used up so much electricity that the city of Plattsburgh exceeded its allotted monthly budget of electricity. One single cryptocurrency mining operation called Coinmint used up around 10% of the city's allotted power supply alone in January and February, according to Motherboard. When its electrical budget was exceeded in January, the city had to buy electricity from the open market at a higher cost, which was distributed among its residents.

Comments

Good

[nwaack]

It's about damn time we start putting an end to this idiocy.

Re:Good

[Anonymous Coward]

Yes, it is a symptom of a larger disease, which is free market capitalism

If the US didn't learn from the Great Depression that a regulated economy is necessary to avoid misapplication of resources and improper allocation of financial responsibility, then we are all fucked (globally)

Re:Good

[bv728]

Since nobody seems to be putting the actual facts as a response:

As part of an agreement with the power company, the city gave them the right to build a large hydroelectric dam on city property in exchange for access to an allotment of power at an extremely cheap rate. When they exceed that allotment, the city has to buy off power exchange, which is significantly more, accounting for covering storage, exchange, and transmission costs on the larger network.

The city very rarely (or never) exceeded that allotment before, and now is. Because of how the contracts are structured, that additional cost is passed on to all consumers on their bill - everyone pays based on time-windowed averaged costs of power over the month, not the exact real cost at the moment of consumption (this is pretty normal due to storage and variable rates per time block otherwise making bills goofy complicated).

The result is they voted in an 18-month stop on NEW cryptomining operations (existing ones can continue) with a plan to submit to the appropriate regulatory bodies a modification to electrical pricing that would allow them to place the additional costs from the Power Exchange on high power utilization businesses, rather than across all users. The cryptomining operations mostly seem okay with this, as the proposal still sees them get a decent chunk of cheap power.

wrong problem

[supernova87a]

The city doesn't need to ban currency mining. They need to fix their electricity tariff (rates).

If currency miners find that it's economical to spend electricity like this, it means that the city is not charging commercial / residential customers the appropriate amounts when they exceed reasonable usage levels. They need to fix that. It probably means that a bunch of other things about their electricity and water and government services are priced incorrectly / being abused as well.

What can you do? All these local/town governments were set up with rules dating from 50 years ago, and they've never changed or adapted since.

Old ideas that are still unproven

[OrangeTide]

If the US didn't learn from the Great Depression that a regulated economy is necessary to avoid misapplication of resources and improper allocation of financial responsibility, then we are all fucked (globally)

I'm very confident that we learned little. We're still pushing 100 year old ideas of laissez-faire capitalism, supply-side economics, and trickle-down economics. Even in the 19th century the ideas of trickle-down were well known enough to be controversial in its day.

"That's what happens when the Republicans take over—not only Nixon, but any of them. They simply don't know how to manage the economy. They're so busy operating the trickle-down theory, giving the richest corporations the biggest break, that the whole thing goes to hell in a handbasket." -- President Lyndon B. Johnson