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A cryptocurrency miner wanted 10 megawatts of power. Wait just a sec, Mason County PUD said

Mason County PUD No. 3 has approved a moratorium on applications for service from cryptocurrency data mining companies because it wants to better understand the industry and their large power needs.
Mason County PUD No. 3 has approved a moratorium on applications for service from cryptocurrency data mining companies because it wants to better understand the industry and their large power needs. Courtesy

Mason County is home to one cryptocurrency mining company — the best known cryptocurrency is bitcoin — and a marijuana grower that wants to expand into a similar business.

But when another Washington state business showed up, a cryptocurrency miner seeking 10 megawatts of power from the local utility, officials at Mason County PUD No. 3 decided to act.

On Tuesday, the PUD's three-member commission voted unanimously on a moratorium. It covers "computer or data processing loads related to virtual or cryptocurrency mining, bitcoin, Blockchain, or similar purposes," according to a news release.

In other words, the utility district won't be accepting applications for service from this type of business until it does its own due diligence.

With the moratorium in place, the utility plans to better understand the fledgling industry and will hire a consultant to undertake a "cost of service" study, identifying, for example, what they should charge the data miners and whether they should ask for money upfront in the form of a deposit.

"We have to be ready for it," said utility General Manager Annette Creekpaum about the industry. "We were not completely ready and then someone started moving before we were ready to go."

The prospective customer sought almost as much power as is used by Sierra Pacific's sprawling lumber mill on Oakland Bay in Shelton. Ten megawatts also represents a significant amount of power for Mason County PUD overall, which has an average power load of 80 megawatts, enough to serve 34,000 customers.

A power request of 10 megawatts also means that the Bonneville Power Administration in Portland has to be notified, Creekpaum said.

Bitcoinmining.com describes its industry in the following way: "Miners use special software to process complex data calculations and are issued the virtual currency bitcoin in return."

And processing that data requires a lot of power. Mason County PUD spokesman Joel Myer said data miners operate "computer server farms on steroids."

The miners have sought out public utility districts, particularly in North Central Washington, because the price per kilowatt hour is typically much lower than that offered by a private utility.

The virtual currency also has a trade value. One bitcoin currently is worth about $6,900.

Customer information is confidential, utility spokesman Joel Myer said, but he did say the power request came from a Washington state business.

After its 10 megawatt request, the business later lowered it to 3 megawatts, but never made it official before the moratorium took effect, Creekpaum said.

She expects the moratorium to be in effect for three to four months before the consultant's study is complete and it comes back before the commission for action.

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