According to a recent Bloomberg story, Iceland is experiencing energy shortages, causing the authorities to limit supply to key businesses. Companies that support blockchain networks have been caught up in energy rationing.
Aluminum smelters, computer centers, fish meal mills, and BTC mining operations have had their supply cut by Landsvirkjun, the island’s largest utility. Furthermore, discounts are available to large clients with revocable short-term contracts. In addition, all requests for electricity from a new block reward mining company are turned down. Last Tuesday, the utility stated that the cuts would take effect immediately.
According to the energy corporation, reduced hydro reservoir levels, a power station malfunction, and a delay in receiving electricity from an external producer have resulted in lower energy allocations. However, according to Tinna Traustadottir, executive vice president of sales and customer service at Landsvirkjun, “record demand” also had a role.
According to Landsvirkjun, the distribution system’s limits prevent it from supplying load locations in the southwest from Karahnjukavirkjun, the country’s largest power station in the east.
Iceland’s largest electricity users are its massive aluminum smelters, which were established decades ago to take advantage of its inexpensive power and renewable energy source. In addition, block reward miners have recently arrived in Iceland and other Nordic countries, attracted by the low power costs required to mint new currencies.
Hive Blockchain Technologies Ltd. (TSXV: HIVE | OTCQX: HVBTF | FSE: HBF), Genesis Mining Ltd., and Bitfury Holding BV are just a few publicly traded enterprises that have set up shop in Iceland. It is the duty of these miners and others not to put undue strain on the grid’s power-producing capabilities.
The energy supply of the country is finite. The more mining electricity is used, the less power is available for homes and other businesses. Like their Swedish counterparts, the Icelandic government may begin to cool on the block reward mining sector if a future energy problem is detected.