Crypto

Quebec urged to cut supply for crypto mining

The process of creating new cryptocurrencies is called Crypto Mining which uses electric power and its high power consumption has consequently led to power shortages in several regimes due to the surge in mining activities.

Quebec, a Canadian province, has published a request for approval of the Distributors’ 2023-2032 Supply Plan as it faces an electricity shortage problem. Hydro Quebec is an energy management company that recently filed a report on November 01, 2022.

Application filed

Undersigned by Nadhem Idoudi, Senior Director Integrated Planning and Development of Business Strategies at Hydro-Québec, at 75, boul. René-Lévesque O., in the city of Montreal, province of Quebec, solemnly affirms that-

The application for Hydro-Québec in its electricity distribution activities (the Distributor) was prepared in part under his supervision and control. He has been employed by Hydro-Québec since 2004 and holds the position of Principal Integrated planning and development of business strategies, since 2022.

Nadhem Idoudi added that during the preparation of the 2023-2032 Supply Plan, he participated in the analysis of the situation of the supply-demand balance in energy and power of the Distributor, in particular with a view to establishing the planning supplies.

He then saw in his planning under normal climatic conditions, the Distributor then envisages additional purchases planned beyond 3 TWh in the winter period, which represents a large volume, and sufficient to require a long-term supply.

In its decision D-2022-062, rendered on May 19, 2022, the Régie considers that the Distributor’s strategy of using short-term markets adequately contributes to managing the vagaries of energy demand.

As can be seen from the energy balance presented in exhibit HQD-2, document 3, the additional energy needs in winter are high, without the additional load linked to the balance of the block reserved for cryptographic use applied to Blockchains (the Reserved Block). Energy purchases of almost 3 TWh in winter are expected from 2025 and even exceeding 3 TWh in 2027.

Any significant additional charge added to the forecast of energy needs linked to the balance of the Reserved Block would therefore lead to additional pressure on the volumes of additional energy to be acquired. The Distributor believes that it is important to limit, as far as possible, the risk of this happening.

The addition of the entire remaining balance of the Reserved Block, in the order of 270 MW, would have an impact on the needs of approximately 2.2 TWh annually, and approximately 700 GWh in winter.

The significant reduction in the quantities of energy for this category of customers would limit the impact of this customer base on Hydro-Québec’s energy balance and would contribute to maintaining the energy balance.

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