Canada's Manitoba province has set an 18-month moratorium on new crypto mining operations, citing the possibility of the local grid being overwhelmed by new projects.
"We can't simply say, 'Well, anyone can take whatever [energy] they want to take and we'll simply build dams'," Finance Minister Cameron Friesen, the minister responsible for the province's utility Manitoba Hydro, said on Monday, according to reports by CBC and CTV News Winnipeg. A spokesperson for the province's utility confirmed the news to CoinDesk via email.
Manitoba Hydro is to stop processing new and existing applications from crypto mining operations looking to connecting to the grid until April 30, 2024, according to a Nov. 16 government directive. The directive also calls on Manitoba Hydro to review how the crypto mining industry affects the grid and engage with the Public Utilities Board as well as the government's finance department and to come up with a regulatory proposal.
The existing 37 mining facilities will not be affected, according to the reports.
Miners have flocked to Canada for its cheap electricity, with Manitoba having the second-cheapest electricity rates in the country after Quebec, according to reports.
Manitoba Hydro has a capacity of about 6.1 gigawatts (GW), and if "every cryptocurrency operator who has shown interest in the last 16 months," was connected to the grid, the total load would increase by 4.6 GW across 240 operations, a spokesperson for the utility told CoinDesk.
"There are currently 37 cryptocurrency customers in the province of Manitoba, but over 240 potential new operations have been in touch with Manitoba Hydro since July 2021," the spokesperson added.
Manitoba Hydro's debt has tripled in the last 15 years as it took on loans to built two new mega projects totaling CAD3.7 billion (US$2.75 billion), Keeyask and the Bipole III transmission line. About 40% of consumers' utility fees go to servicing debt, according to Manitoba Hydro.
The Finance Minister did not respond to CoinDesk's requests for comment.
UPDATE (Dec. 2, 07:47 UTC): Adds confirmation from Manitoba Hydro and other details.
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