Crypto Miners Blamed for Power Outages in Russia’s Irkutsk, 1,100 Cases of ‘Gray Mining’ Emerge

Local authorities conducted raids in the region and uncovered 21 electrical installations suspected of cryptocurrency mining.

By Radhika Parashar | Updated: 3 January 2022 16:39 IST

Crypto Miners Blamed for Power Outages in Russia’s Irkutsk, 1,100 Cases of ‘Gray Mining’ Emerge

Photo Credit: Unsplash/ Sam Oxyak

Bitcoin mining reportedly uses around 121.36 terawatt-hours (TWh) of electricity per year

Highlights

Electricity consumption in Irkutsk grew by 108 percent in 2021
Gray Mining is when crypto mining happens from home
Carbon emissions linked to crypto mining is also major issue

The Irkutsk region of eastern Russia has been riddled with power outages for a while now, the blame of which is befalling on native crypto miners. As per the Irkutsk Electric Grid Company (IESC), the electricity consumption in the region grew by 108 percent last year. Local administrators conducted raids in the region and reportedly uncovered 1,100 cases of “gray mining”. The term refers to crypto mining from home, where equipment is set up in apartment basements, garages, residential premises, as well as on balconies.

“In Irkutsk, 21 electrical installations suspected of cryptocurrency mining were identified. Mining equipment was installed on balconies, in residential premises and basements of apartment buildings,” Irkutskenergosbyt, the electricity provider of the region said in a post.

Often called the “crypto mining capital of Russia”, the power cost in Irkutsk is six times lower than the average price of electricity in other parts of the country. Hence, residents of the region often use their subsidised home electricity to mine cryptocurrencies, a report by Bitcoin.com said.

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Details about the measures being considered to control crypto mining activities in Irkutsk remain unclear as of now.

As per Cambridge researchers, the mining of Bitcoin consumes around 121.36 terawatt-hours (TWh) of energy a year.

The process of crypto mining is also associated with large-scale carbon emissions, which is a topic of concern amid the ongoing environmental issues.

Between January 1, 2016, and June 30, 2018, the mining operations for four major cryptocurrencies released up to an estimated 13 million metric tons of carbon dioxide, a research report had claimed last year.

Last year, after China banned all crypto-related activities, Tesla chief Elon Musk commented that electricity shortage could be a major factor behind China's decision.

“A lot of South China right now is having random power outages because the power demand is higher than expected. Crypto mining might be playing a role in that,” Musk had said at the time.

In November 2021, the Electric Reliability Council of Texas (ERCOT) had estimated a five-fold increment in energy loads to support crypto mining and data centres.

The revelation had emerged after residents of US' Texas state had raised complaints that the crypto-mining processes were eating up the region's power supply.

Interested in cryptocurrency? We discuss all things crypto with WazirX CEO Nischal Shetty and WeekendInvesting founder Alok Jain on Orbital, the Gadgets 360 podcast. Orbital is available on Apple Podcasts, Google Podcasts, Spotify, Amazon Music and wherever you get your podcasts.

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Further reading: Cryptocurrency, Mining, Crypto Mining, Miners, Russia

Radhika Parashar

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Radhika Parashar is a senior correspondent for Gadgets 360. She has been reporting on tech and telecom for the last three years now and will be focussing on writing about all things crypto. Besides this, she is a major sitcom nerd and often replies in Chandler Bing and Michael Scott references. For tips or queries you could reach out to her at RadhikaP@ndtv.com. More