Fitch Ratings warns of risks crypto miners pose to US power supply
Global credit rating agency Fitch Ratings is warning public power utilities across the United States to mitigate the risk crypto mining could post their production of power.
In a Monday notice, Fitch Ratings said that only utilities in states like Washington, which have excess generation capacity, may be capable of meeting the power requirements of many crypto mining operations. The agency claimed that though some crypto mining firms can become “the largest customer in a rural service territory,“ the operations typically bring in “very little additional economic benefits” from jobs or boosting the local economy.
“The volatile and unregulated nature of crypto mining and the large influx of load requests led a number of Washington utilities to adopt new practices beginning in 2014 to mitigate exposure to crypto mining entities, including crypto-currency load moratoriums, evolving rate structures to capture the departure risk of a high-risk industry, and defined customer concentration limits,” said Fitch Ratings.
In Texas, where many mining operations have set up shop following an exodus of firms in China, Fitch Ratings suggested utilities companies invest in new facilities, sign long-term power purchase agreements, or obtain power through market purchases in real time to handle the additional load. However, each option carries financial risk which may eventually be passed on to residents:
Many crypto mining companies are seeking the most cost-effective area to mine tokens, with some U.S. States, including Texas and Washington, offering more favorable conditions than others. Canadian mining firm Bitfarms announced in November that it was planning to build a data center in Washington State, citing its “cost-effective
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