Current situation of bitcoin mining industry in Norway: controversy and growth

Wu Shuo real 2022-04-06 12:37:52 阅读数:882

current situation bitcoin mining industry

This article belongs to the description of countries all over the world The currency One of a series of articles on Mining , This paper focuses on the current situation of bitcoin mining in Norway , I'm from Norway , First hand knowledge of bitcoin mining in Norway . in addition , I am here Arcane The company work , Arcane There is a mining business in Norway .

I will explain why bitcoin mining is booming in Norway , The focus is on the electricity market and the regulatory environment , It also provides an overview of all mining operations in Norway .

The land area is small , The mining scale is large

We should first find out how big the bitcoin mining industry in Norway is . Before putting forward my own numbers , I will provide several existing estimates .

Bitcoin mining map of Cambridge University , Estimated the share of computing power in each country , Norway's share of bitcoin's computing power in the whole network is given 0.58%. Compare this share with their total electricity demand of the Tete mining network 15.6GW Multiply the estimates of , The electricity consumption of Norwegian miners is 90 MW, Suppose their hardware has the same power efficiency as the average level of the network .

CoinShares It also estimates the scale of bitcoin mining in Norway , Found that it consumed 66 MW Of electricity . Cambridge's top-down approach uses data from four pools to estimate the geographical distribution of miners , and CoinShares Apply bottom-up procedures to identify all mining facilities in each country .

And CoinShares similar , I did my best to map all the mining facilities in Norway , And determine the current status of Norway 120 MW Bitcoin mining business , You can find it on the map below . This power consumption , Multiplied by the estimate of the total power demand of the bitcoin mining network at the University of Cambridge , It means that bitcoin miners in Norway have produced a net of bitcoin computing power 0.77%.

Who is mining in Norway ?

Norwegian miners created almost 1% The power of bitcoin , Although not the biggest , But it is still an important contributor to ensuring network security . Who are they? ?

       

 

It is mainly composed of some local people and several large international companies . Local players include Kryptovault and Arcane Green Data, and Northern Data、Bitdeer、Bitzero and COWA Is a larger global company .

Oasis of renewable energy

Now we will begin to explore what attracted all these miners to Norway .

Mining is an energy intensive industry , There is huge public pressure on its carbon footprint . therefore , The primary task of miners is to power their operations with renewable energy .

Norway has mountainous terrain and humid climate , Hydropower is a paradise . The construction of hydropower stations began with 19 The end of the century . From then on , Hydropower has always been the main source of electricity in Norway , It provides the country with a lot of cheap 、 Reliable and green electricity .

       

Basically , The Norwegian 88% Electricity comes from water ,10% From the wind . except 2% Natural gas supplies Norway offshore oil , Norway is 100% Renewable energy , This makes the country attractive to miners who want to reduce their carbon footprint .

The situation now looks good , But how will Norway's power generation develop in the next few years ?

Norway has great potential for new hydropower development , But getting a development license has become increasingly difficult .NVE It is estimated that , until 2040 year , The installed capacity of hydropower will be only 11 TWh, Compared to today's capacity , It's only equivalent to a faint 8%.

Although onshore wind power generation capacity is growing rapidly , but NVE It is estimated that , To 2040 year , It will only have 3 TWh The growth of . On the other hand , Offshore wind power generation capacity will grow rapidly , In the same period from 0 To 7 TWh. Believe it or not , Solar energy can also come from 0 Add to 7 TWh.

       

       

As you can see , stay 2040 Years ago , Norway's power generation will not change much , Except that the ratio of wind energy to solar energy is slightly higher .

For bitcoin miners , The most important revelation about Norway's power structure is , It is completely Renewable , And will remain in this state .

Further north , The cheaper the electricity

Due to the zero marginal cost of all hydropower , Norway has always enjoyed the cheapest electricity in Europe . Although the country is divided into five electricity price zones , But prices have always been similar in all regions . In this case 2021 The year has changed .

       

       

In the past five years , Electricity prices in all price zones are usually maintained at per kilowatt hour 0.03 to 0.05 Between US dollars , Only to 2020 I was interrupted only in , At that time, because the precipitation was higher than the average , The hydropower reservoir is filled , This has led to electricity prices falling below per kilowatt hour 0.01 dollar .

After going through 2020 After years of exceptionally cheap , Electricity consumers in southern Norway are 2021 It was hit in , Because their prices have gone up 7 times , Consumers in the north and central regions did not see a similar rise .

There are several explanations for the sudden regional price differences , But the most important factor is , With 2020 The end of the year and 2021 The opening of a new underwater power line to the European continent at the beginning of the year , Southern Norway is already closely connected to the electricity market in other parts of Europe .

Because southern Norway is so closely connected with the European market , The price in continental Europe directly affects our domestic electricity price .2021 It was a year of record high global energy prices , Natural gas 、 The price of coal and carbon dioxide soared , Making electricity expensive in Europe , Further dragged down prices in southern Norway .

       

 

Due to transmission restrictions between central Norway and South Norway , Only the southern part of the country is fully connected to the European market . Due to limited transmission capacity , The central and northern regions are still enjoying low prices .

Electricity will be expensive in the South , In the north, it's cheap

Because Norway is connected to the volatile European market , It is uncertain how the future electricity price will develop . Norwegian national grid operator Statnett expect , Due to European gas and coal prices " Normalization ", Electricity prices will gradually decline .

       

       

Statnett The analysis is before the war between Russia and Ukraine . The conflict has led to soaring fuel prices , Put upward pressure on European electricity prices . therefore , I don't agree with Statnett The price of fuel will " Normalization " My optimistic view , I expect electricity prices in southern Norway to remain high .

Although prices in the South will remain high , But I don't expect a similar rise in prices in the North soon . Due to the record high price in South Norway , They want to use the power of northern Norway , However, due to the limited transmission capacity, it is impossible to achieve . Norway's state electricity company plans to 2030 New transmission lines were built years ago to alleviate these restrictions , I expect the price gap to last at least until then .

Norwegian miners want to contribute to the energy sector

Norwegian miners are exploring ways to increase their participation in the energy sector , Or by providing balanced services in the electricity market , Or by reusing the waste heat generated in operation .

With the increasing share of wind and solar energy in power generation capacity , The demand for energy intensive industries such as bitcoin miners to help balance the power system is also increasing . Electricity supply and demand must always be balanced , historically , We can achieve this balance by simply adjusting the production of the supplier . Because wind and solar energy depend on the weather , We can't easily adjust their production according to demand .

Norwegian grid operator Statnett come to know , The demand for grid balance will increase , Therefore, a balanced market has been opened this year , Demand side resources such as bitcoin miners can participate . Bitcoin mining is very suitable for grid balancing , Because the process consumes energy , It can also be interrupted with little cost .

Besides , Many Norwegian bitcoin miners are experimenting with reusing the waste heat generated during operation . From an economic and ecological point of view , These waste reduction initiatives can benefit Norway , Because heating accounts for a large part of the energy consumption of this cold country . meanwhile , Heat is the main waste component of bitcoin miners .

Kryptovault Has been reused Hønefoss The heat of operation has been used to dry wood for more than two years . The company collects heat generated during mining through pipelines , And donate it to a local timber company , The company employs six employees in the area , Less waste , And created local employment opportunities .

       

       

Kryptovault The wood drying project is just one of many potential applications to reuse the heat mined by bitcoin . Miners are studying the possibility of connecting to the district heating system , For fish farms 、 Greenhouse 、 The swimming pool 、 Spa, etc . The potential is huge , I believe in the next few years , We will see this process flourish in Norway .

National political stability , But bitcoin mining is controversial

In addition to looking for cheap and green electricity , Miners also seek jurisdictions with good regulatory environment and political stability .

Norway is one of the most politically stable countries in the world , The regulatory conditions of most enterprises are acceptable , Ranked ninth in the world bank's business environment index .

For all that , Bitcoin mining is not the most popular industry in Norway , There is also some political opposition .

Although most electricity consumers in Norway pay per kilowatt hour 0.1541 Norwegian krone (0.017 dollar ) Electricity tax , But the energy intensive industrial sector pays only... Per kilowatt hour 0.0055 Norwegian krone (0.0006 dollar ).2016 year , The Norwegian government has made the data center comply with the reduced electricity tax rate , To attract more data centers to Norway .

The government wants Google or facebook , But got bitcoin miners . They are dissatisfied with the counterproductive effect of their regulations , Decided to 2019 Tax cuts for cryptocurrency miners were abolished in . result , Miners' electricity prices have suddenly risen per kilowatt hour 0.016 dollar , In a electricity price, the median value is 0.04 In the dollar industry , This is a considerable amount .

Many data centers in Norway are joint facilities , Partially hosted bitcoin miners . therefore , The tax increase has had a great impact on the data center industry . Besides , The stability of Norway's political data center has not been directly affected before , The country's good international reputation in the industry began to disintegrate .

In the Norwegian business alliance and Norway IT association IKT Norge With the support of , The whole industry quickly United , Began to oppose tax increases .

2020 year , The Norwegian government succumbed to pressure , It was finally decided not to cancel the reduced electricity tax . They may have realized , Such meticulous selectivity in deciding who is eligible for the reduced electricity tax , Norwegian and international law are likely to be violated .

For all that , The damage has been done . Due to increased regulatory uncertainty ,Bitmain、Hive Blockchain and several other companies decided to leave Norway .

Bitcoin miners are considered eligible for a reduced electricity tax , But we may not have seen the end of this legend . Some Norwegian politicians still haven't given up raising the miners' electricity tax , Some even want to ban bitcoin mining .

lately , We have also seen attempts by the EU to impose regulatory restrictions , Norway is not a member of the European Union . However , The EU still has considerable influence on Norwegian legislation , Most of the agreements of the European Union must be followed .

2021 year 11 month , The Swedish regulator has presented a draft , from 2025 Bitcoin has been banned in the EU since . Norwegian Minister of local government and regional development Bjørn Arild Gram announce , If the ban is passed in the European Parliament , He will try to replicate the ban in Norway . Final , The attempt to ban failed .

Fortunately, , Norway does not have a long history of banning certain activities based on subjective opinions . Besides , Some international agreements also protect industries from government interference . therefore , Even if some people in the national government don't like it , Mining in Norway is also unlikely to become regulatory infeasible .

summary

Given Norway's small population , Cheap and clean electricity in the country 、 The cold climate and stable political environment have attracted the huge bitcoin mining industry .

from 2021 Year begins , There is a huge difference in electricity prices between southern and northern Norway . This price gap will continue , therefore , Miners should ideally locate their business in the far lower cost North .

Although Norway is considered one of the most politically stable countries in the world , But the bitcoin mining industry is still controversial , And face some political opposition . for example , The Norwegian government's attempt to raise electricity taxes specifically for miners failed , Swedish regulators have also failed to ban bitcoin trading within the EU .

however , We should remember , The bitcoin mining industry is not only controversial in Norway , The same is true in most other countries . therefore , Compared with most bitcoin mining alternatives outside North America , I don't think Norway is one of the most politically hostile countries to the industry .

lately , North America has absorbed a large share of mining , I guess , Some of these miners see Norway as a potential location to diversify geographically .

Besides , As mining companies face increasing public pressure to use renewable energy , Norway's green hydropower has become more attractive .

For these reasons , I expect the bitcoin mining industry in Norway to continue to grow , Especially in the northern part of the country .

       

author  | Jaran Mellerud

translate  | Gary Ma Wu said that the blockchain is authorized by the author to translate

original text :

https://arcane.no/research/bitcoin-mining-around-the-world-norway

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