Ethiopian Electricity Regulator Announces Plans to Crowd Out Cryptocurrency Miners
The state-owned Ethiopian Electric Power (EEP) has announced its intention to halt all cryptocurrency mining operations in the country. According to the organization, amid growing concerns, it plans to phase out all cryptocurrency mining activities.
Ethiopian Electric Power stressed that the move was necessary due to growing public pressure over the increasing strain on energy resources caused by these crypto hubs, which has caused public concern and provoked discontent among the population.
Last year, cryptocurrency mining companies began setting up operations in Ethiopia due to low electricity prices. While the government is also looking to attract foreign investment, fears over increased energy needs have forced EEP management to reconsider its plans.
Ethiopian Electric Power to Gradually Halt Cryptocurrency Mining Operations
The recently released Ethiopian Energy Outlook 2025 report found that cryptocurrency mining is likely to consume about one-third of all electricity generated in Ethiopia this year. The report stressed that such consumption could threaten vital sectors, especially regions that continue to suffer from power outages and reliance on diesel generators.
Data centres are expected to consume eight terawatt hours (TWh) of electricity this year, raising questions about the viability of such use, according to a report prepared by government agencies and the country's Petroleum and Energy Authority.
While cryptocurrency mining was seen as a way to exchange currency, the report discussed the debate caused by energy consumption, noting that Ethiopia has a shortage of efficient electricity sources.
“Because the balance between supply and demand is tight, the question remains whether electricity could be used more efficiently for export, general electrification, or other productive purposes such as pumping water in the water and agricultural sectors, where diesel generators are widely used,” the report said.
However, the EEP has made a decision that will benefit the majority of the country's population.
EEP gradually suspends contracts with data processing companies
The energy regulator will no longer sign new contracts in the field of data mining, according to Asheb Balcha, CEO of EEP. “There will be no new contracts in the field of data mining, and we are not interested in continuing the existing ones,” Balcha said during the annual review of activities on Friday, August 7. However, he added that the sector was never part of the EEP’s long-term strategy.
The EEP’s decision also reflects a growing focus on equitable distribution of electricity. While cryptocurrency miners pay around 3.14 cents per kilowatt-hour, millions of Ethiopians still lack access to reliable power. In a statement, Esheber said, “Domestic consumers and strategic industries always remain our priority.”
Esheber also said that 50% of EEP’s current revenues are allocated to the Koisha hydroelectric project, which is the country’s second largest after the Ethiopian Renaissance Dam (GERD). The CEO added that the project’s implementation has been slowed by funding constraints. However, Ethiopia has received a special loan waiver of US$950 million to complete Koisha under the IMF’s Extended Credit Facility (ECF) program.
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Source: cryptonews.net
