Bitcoin Mining Banned In NY's Plattsburgh Over Electricity Usage

Mining bitcoin and other cryptocurrency requires a huge amount of electricity, and that's a problem for modern day prospectors in search of a fortune. Mining operations have popped up in New York's Plattsburgh, a small city with incredibly cheap electricity rates due to its proximity to a hydroelectric dam. Mining operations have gravitated to the city to take advantage of its cheap rates, but that has proven to be a big problem for the small city.

Mining operations are often home to massive hardware arrays that work day and night to mine cryptocurrencies like bitcoin. The electricity gobbled up by these so-called bitcoin farms have raised concerns about the environmental impact of digital currency. For Plattsburgh, though, the concern revolves around consumption and the effects it has on electricity rates.

Though existing operations in the city are allowed to remain, Plattsburgh has decided to implement an 18-month moratorium on any new mining plans. According to Motherboard, the decision was unanimously voted in place by the city council after being proposed by Mayor Colin Read. That proposal itself followed complaints from residents over the huge jump in their electricity bills.

It's easy to see why mining operations are attracted to the city. Plattsburgh residents pay a mere 4.5 cents per kilowatt-hour, though industrial enterprises in the city pay an even lower 2 cents. According to Read, some people have seen their electricity bills increase by $100 or more per month. In the next 18 months, the city will work with both residents and mining operations to solve this problem.

Which solution the city will settle on hasn't been determined, but it has been suggested that mining operations may have to pay for overages. Whether Plattsburgh will be as appealing with that change isn't clear, though.

SOURCE: Motherboard