Manitoba suspends new cryptocurrency operations, citing high energy demand
The Manitoba government is temporarily halting any new connections of cryptocurrency operations to the hydroelectric grid, citing a potential for overwhelming energy demands and low economic return.
The 18-month pause will not affect the 37 current operations in the province, but will temporarily halt a growing number of requests from operators who have the capacity to consume a sizable portion of the province's electricity supply.
"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 Crown-owned Manitoba Hydro, said Monday.
"The last one cost $13 billion if you priced in the (transmission) line."
The technology that underpins cryptocurrencies -- blockchain -- requires a large amount of electricity to run complex financial transactions. Manitoba is an attractive place for high-energy users, as it has traditionally had the second-lowest electricity rates in Canada, behind Quebec.
Hydro-Quebec earlier this month announced it was asking its provincial regulator to suspend the energy allocation process to the blockchain industry.
Friesen said there have been recent requests to Manitoba from another 17 operators that would require 371 megawatts of power -- more than half the power generated by the Keeyask generating station, which became fully operational earlier this year.
There have also been other, less formal inquiries, Friesen said, which would total more than 4,600 megawatts.
Manitoba Hydro is still carrying debt from its last series of construction work. The utility saw its debt triple in 15 years as it built two megaprojects, the Keeyask generating station and the Bipole III transmission line, which ran a combined $3.7 billion over budget.
Part of the Progressive Conservative government's concern is that blockchain operations may not produce many jobs, Friesen said.
"You can be utilizing hundreds of megawatts and have a handful of workers."
The vice-president of the Canadian Blockchain Consortium, an industry group, said high-paying jobs are involved in operating the servers.
"Somebody's going to have to service them, check on them, make sure they're running," Jade Alberts said from Calgary.
Blockchain operators also have the ability to adapt to the needs of the grid, he said. Operators in Texas shut down when extreme heat or cold push energy demand among Texas residents high, he said.
The Manitoba government's review is to analyze, among other things, the economic impact of cryptocurrencies and a potential for a regulatory framework for approving new large connections to the grid.
"Manitoba Hydro (currently) cannot make discretionary decisions about who to hook up," Friesen said.
"If we have a new Tim Hortons in downtown Portage la Prairie ... and we have a mine with 500 employees, there is a queue that must be respected."
This report by The Canadian Press was first published Nov. 28, 2022.
CTVNews.ca Top Stories
'They needed people inside Air Canada:' Police announce arrests in Pearson gold heist
Police say one former and one current employee of Air Canada are among the nine suspects that are facing charges in connection with the gold heist at Pearson International Airport last year.
Why drivers in Eastern Canada could see big gas price spikes, and other Canadians won't
Drivers in Eastern Canada face a big increase in gas prices because of various factors, especially the higher cost of the summer blend, industry analysts say.
Customers disappointed after email listing $60K Tim Hortons prize sent in error
Several Tim Horton’s customers are feeling great disappointment after being told by the company that an email stating they won a boat worth nearly $60,000 was sent in error.
Toronto Raptors player Jontay Porter banned from NBA
Toronto Raptors player Jontay Porter has been handed a lifetime ban from The National Basketball Association (NBA) following an investigation which found he disclosed confidential information to sports bettors, the league says.
House admonishes ArriveCan contractor in rare parliamentary show of power
MPs enacted an extraordinary, rarely used parliamentary power on Wednesday, summonsing an ArriveCan contractor to appear before the House of Commons where he was admonished publicly and forced to provide answers to the questions MPs said he'd previously evaded.
Woman who pressured boyfriend to kill his ex in 2000s granted absences from prison
A woman who pressured her boyfriend into killing his teenage ex more than a decade ago will be allowed to leave prison for weeks at a time.
Attempt to have murder charge quashed against alleged serial killer dismissed by judge
A motion filed by the man accused of killing four Indigenous women in Winnipeg to have one of those murder charges quashed has been dismissed by the judge – weeks before the start of his trial.
Government proposes new policy for federally regulated employees to disconnect from work
In their 2024 budget, the federal government wants to amend the Canada Labour Code, so employers in federally regulated sectors will eliminate work-related communication with employees outside of scheduled hours. If implemented, this would affect roughly 500,000 employees across the country.
Earthquake jolts southern Japan
An earthquake with a preliminary magnitude of 6.4 hit southern Japan late on Wednesday, said the Japan Meteorological Agency, without issuing a tsunami warning.