New Brunswick Proposes Ban on New Crypto Mining Operations

According to Blockworks, the Canadian province of New Brunswick is considering a ban on new cryptocurrency mining operations. Critics argue that policymakers are missing an opportunity to collaborate with mining companies to increase the stability of their electric grid. An amendment to New Brunswick's Electricity Act states that a distribution electric utility shall not extend its supply of electricity to a cryptocurrency mining business. The proposal, made by Mike Holland, minister of natural resources and energy development, would not apply to operations that entered into a contract before the potential passage of the legislation.In March 2022, New Brunswick Premier Blaine Higgs signed a cabinet order supporting a freeze of service to new crypto miners. Holland told CBC that the cryptocurrency sector has a significant demand for electricity, and the province cannot compromise the existing rate base. However, Lee Bratcher, founder of the Texas Blockchain Council, told Blockworks that some jurisdictions do not understand how bitcoin mining can be used as a tool and resource for their grid operator and may seek to ban bitcoin mining in that locality.Miners in Texas have the option to sell their grid-balancing rights to the Electric Reliability Council of Texas (ERCOT) by reducing their energy consumption. Riot Platforms received $31.7 million in credits from ERCOT for curtailing power usage during peak energy demand times. Bratcher said that if New Brunswick passes the bill, it would be taking a curious step to ban the end use of electricity while preventing a grid resource like bitcoin mining from serving as a flexible, demand response capable load.Hive Digital Technologies operates a 70-megawatt data center in New Brunswick. Gabriel Ibghy, general counsel for HIVE Digital Technologies, said he expects the bill to have no impact on Hive's operations in the region, as the proposal excludes existing crypto mining operations. Ibghy added that local legislators should consider partnering with data center operators like Hive to stabilize their grid and offtake surplus renewable power from new and green generation projects. The proposal contrasts with miner-friendly legislation in certain US states, such as Montana, which passed a bill in May allowing miners to conduct their business free from government interference.