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China's Inner Mongolia province will raise electricity tariffs by 30%

China’s Inner Mongolia province will raise electricity tariffs by 30%

After checking 30 enterprises working in the field of cloud computing, the authorities of the Chinese province of Inner Mongolia decided to raise electricity tariffs by 30% for 21 mining farms.

The authorities of Inner Mongolia found that 21 firms from the list of organizations undergoing verification are engaged exclusively in cryptocurrency mining, having no relation to the big data industry. Therefore, regulators believe that these firms should not operate at reduced electricity rates.

Reduced tariffs are provided only for participants of the regional electricity trading center market. It has been in existence since 2006, and since October 2019, the number of participants has reached 1,820 enterprises. Thanks to this market, firms managed to reduce their electricity costs by 30.01 billion yuan.

For mining farms that have access to the regional market, the tariff is $0.02-$0.03 per kWh. For those who drop out, the price for electricity consumption can reach $0.47 per kWh, an increase of about 30%.

Inner Mongolia is one of the largest mining centers, along with Sichuan province, which accounts for more than 50% of the global hashrate of the Bitcoin network.

Previously, the regulatory authorities of Inner Mongolia planned to restrict the activities of all mining companies, considering that the production of cryptocurrencies does not bring real benefits to the economy. Last fall, regulators announced that they would conduct more frequent inspections of mining companies and strengthen control over them.

Recall that last week, due to flooding in the Chinese province of Sichuan, the average three-day hashrate of the Bitcoin network fell to 123 eh/s, and the average daily hashrate-to 110 eh/s.