In a recent announcement published on June 7, Hydro-Quebec, a Canadian electricity provider announced that it is temporarily preventing the processing requests from crypto miners.
As a consequence, the new approvals for mining project will not be accepted until it sets a new framework which may include high power consumption fees. Furthermore, the move aims to supply energy across the entire province and fulfill the obligations.
Hydro-Quebec QBEC.UL is a state-owned electricity provider in Quebec which was reportedly receiving “unprecedented demand” from blockchain firms. Such exceeding demand results in Quebec provincial government to issue an order to QBEC.UL to act upon immediately.
Urge to Maximize the Revenue
The reports reveal power rates in Quebec regions were relatively low for consumers and industrial customers as well. Accordingly, in future days the QBEC.UL will process an application to Régie de l’énergie, the provincial regulator on specific terms.
The term proposes a “selection process” for crypto mining firms/projects. Additionally, this new application will highlight the significance of emerging blockchain industry and benefit from its growth opportunities.
Moreover, the Government expects regulators to govern the sale of electricity to blockchain companies in consideration of;
- New category Frameworks for electricity consumers in the crypto sector
- Determining explicit rates for this category
- The need for a reserved block of energy for these consumers
- Capitalizing the revenue of Hydro-Québec
- Focusing on employment by improving the Quebec’s economic condition
Quebec seems as a more crypto-friendly region thereby it often receives a number of applications from companies from China & other countries. The deteriorating conditions in other countries push away crypto miners to find different solutions. The positive climate (both weather and economic) of Canada results in attracting crypto mining ventures to the country.
Despite the growing demand, Quebec will have new rules that determine “the best among the companies” from crypto industry. According to Hydro-Québec Distribution President Eric Filion, these new rules aim to define the best outcome of the digital mining industry for Quebec instead of raising higher power rates to its citizens. However, he also sees a strong potential of blockchain industry to maximize the revenue.
He said, “The blockchain industry is a promising avenue for Hydro-Quebec,”
We have yet to understand the implications of these changes. Most likely it means that there will be increased fees for cryptocurrency mining companies. Another thing to take away from this piece of news is the selection process, which will effectively limit the number of companies mining in Canada.
This limitation can and probably will lead to crypto mining companies lobbying for their spots in the Canadian economy.