Iran to set Electricity Tariffs for Bitcoin Mining
Iran’s Economic Commission has agreed to set electricity tariffs for bitcoin mining activities based on the prices used for electricity exports. The new tariff scheme is expected to come into effect as soon as it gets approved by the Iranian Cabinet, according to a Financial Tribune report, July 21, 2019.
Iran’s Crypto Miners to pay More
These are not the best of times for bitcoin and altcoin miners in Iran, as the government is now ready to significantly increase electricity prices for the business.
Per sources close to the matter, the Economic Commission of the Iranian government has finally made it clear that electricity prices for crypto mining will be calculated using the same tariffs used for electricity exports; Iran currently exports electricity to neighboring countries like Iraq, Afghanistan, and Pakistan.
Reportedly, Homayoon Ha’eri, the Energy Ministry deputy for power and electricity has revealed that though it has been agreed that crypto miners will no longer enjoy cheap electricity, though the decision is yet to be approved by the presidency.
While Ha’eri failed to state the exact amount that miners will be required to pay per/kWh of electricity, he has however hinted that the operation may not have a fixed energy price since electricity export prices are variable and based on a number of factors including fuel prices in the Persian Gulf region.
Raising Tariffs to Offset Cost
It’s noteworthy that bitcoin miners are not the only ones being affected by the new electricity price hike in Iran.
According to local sources, it costs about 2 cents to produce and transmit a kilowatt-hour of electricity (kWh), while the same was being sold at the rate of 0.7 cents/kWh due to energy subsidies put in place by the government.
Earlier in April, the Iranian government approved a proposal by the Energy Ministry to raise water and electricity tariffs by 7 percent, in a bid to generate more funds to take care of distribution costs and curb power wastage.
As reported by BTCManager on June 11, 2019, Iran’s Deputy Minister for Energy stated categorically that bitcoin miners will no longer enjoy electricity subsidies as the government can no longer afford it due to the current international sanctions on the nation.
In related news, On June 28, 2019, BTCManager informed that Iranian authorities seized 1,000 bitcoin mining machines in the central province of Yazd for illegally using government-subsidized electricity.