Residents had been dealing with the noise from the mining cooling fans for a long time. But now that the operation's shut down, they’re looking at significantly higher electricity bills every year, like hundreds of dollars more.
So, folks in Norway had to put up with all that noise from bitcoin mining, and now they get to enjoy the lovely surprise of higher monthly bills instead.
The company is saying that bills could jump by as much as $300 a month.
"Compromise"
Is what I say when I hear such news. On one hand you have mining companies who are trying to make a living and on the other side you have local residents who have to bear the noise and have an unknown invisible cut on their bills.
Bad for the company to set up in a location where locals are living. I hope their permit is renewed quickly but they should think about changing their location if feasible.
A lot of factors might be at play here, we are only seeing one side of the story.
Was that declared on press or this forum? I did not find any such info in the OP's quoted article.
I guess being the mining guru of this forum does come with some cool info from time to time
Too bad because I feel they could have relocated to a new country with those ASICs and started afresh, but my knowledge is limited to what conditions they were actually going through, maybe that was not something possible.
I also have same question. I tried searching it, but only find news about different mining company auction their used S19 and mining on Europe isn't viable since late 2022[1]. The latter news also interview Kryptovault, where they claim they only turn on their mining on certain occasion. So it's surprising they didn't shutdown sooner.
[1] https://www.coindesk.com/business/2022/12/22/europes-last-bitcoin-mining-refuge-is-no-longer-viable/
I think that if there was a competitive price for electricity then the mayor of that city can make a new tender for a mining farm, but with specifications for water cooling. Now there are many ways where heat can be used and no noise will be heard.
I got an email for an auction from norway. 2880 s19 start bid of 288000 or 100 a piece.
my guess was that email and the timing of this thread match perfectly.
I get lots of auction emails for big lots of gear.
this was one of many emails I got this year.
Competitive electricity price does sound nice. But mining companies need more than the average household needs so they are bigger consumers and limited and hence the chances are small.
I am surprised to see that noise reduction measures were not taken or is that an exaggeration on the part of the authorities?
That might explain it to be the same group involved in this project. Guess we are not going to any of them return anytime soon.
Technically losing their biggest customer should increase the supply of power, which means a decrease in the electricity bill but since the electricity provider is a private entity they will look to compensate the loss from losing customers with existing customers thus leading to an increase in the electricity costs.
The article has misleading information that bitcoin mining will lead to decreased electricity bills which is not true though, miners will consume more power so in long run it's not gonna be help with reducing.
^^ Wrong.
Having customers that can provide a constant high base load decreases residential costs because the generating plants can run at near max output which is where they are most efficient. If there is no way to sell the excess power from losing those loads then costs to other customers go up because there is not a 1:1 ratio of plant operating cost vs output. The operations in Texas and their deals with ERCOT are a great example of that.
Now as far as mining reducing costs - that is another story. If there was little excess power available to begin with then I doubt residential users would see any reduction in their bill from mining operations starting up.
edit: as D5000 said, there is also the pretty much fixed cost of running/maintaining the power transmission infra. Losing a major customer means everyone else has to now pay more to makeup for that loss.
These asics are not very profitable, at 5 cents per kilowatt of electricity they will give 10000 dollars profit per month. But you will still have a lot of extra costs
https://www.asicminervalue.com/miners/bitmain/antminer-s19j-90th
2880x3250W=7410 kilowatts consumption per hour.
I think that the miners just closed unprofitable business or because of low profits did not want to negotiate with the residents of the town.
The article misses a bit of depth unfortunately, and the articles on other crypto media are mostly copy-and-paste from the Bitcoin Magazine (or vice versa). So there' no info about the source of the electricity, and if the local grid operator also operated the power plants.
But apparently the reason for the electricity cost increase was however the abrupt shutdown of the largest client. i.e. the revenue for the power company was reduced such that they needed more income to sustain the fixed costs and a price increase was the only way.
In addition the town seems to be located on an island in an archipielago quite far in the north, so it's likely the local grid is either isolated or has limited connections to the rest of the country's grid.
Thus, it could indeed be the case that the mining facility lowered the electricity cost during its operation, not so much because of the efficiency of the generation @NotFuzzyWarm mentioned (although this could also be a minor factor) but because the presence of a large customer helped to distribute the grid maintenance costs on more shoulders. Local grids in very sparsely populated areas like Northern Norway are quite expensive (in terms of cost per customer) to maintain if there are only few large customers like industries. So this has to do less with Bitcoin mining itself but more with the economic structure of the region.
I agree that the big mining companies are now building 50-100 megawatt data centres and want the ability to expand by several hundred megawatts additionally. Maybe these companies will not be interested in 7.5 megawatts, but for a small miner it is a good project.
Economics are rather complicated, it is not what you think, supply and demand are the the root of it, and then how they go together would determine the end result.
Say you have a vilage of 10 people, you buy 10 bottels of milk from the next vilage and sell it there, it costs you $1, you sell it for $2, what happens when 90 more people move to the same village, milk prices go up you would say -- but not always.
with 100 customers, you may now start thiking about buying a cow (not possible with only 10 customers), you now save on transportation and storage, your cost may drop to 90 cents and you can still sell it for $1.95, so overall 5 cents more profit for you and 5 cents less cost for the buyers.
The same logic applies with electricity, there do exist cases whereby the demand is low enough causing the production and transmission to be power more expensive.
The government launched a power bill support scheme which covers 80% of the portion of the electricity price that exceeds NOK 0.70 per kWh. From October to December of this year, that percentage will jump to 90%.
https://www.lifeinnorway.net/why-is-electricity-so-expensive-in-norway-right-now/
https://www.regjeringen.no/no/tema/energi/regjeringens-stromtiltak/id2900232/?expand=factbox2900261
They have an electricity price of 6.6 cents for households.
so it was all 3000 watt 90 th machines
so 24 x 3 = 72 kwatts a day at 5 cents 3.60 for power
and 90 th x 4 cents is 3.60
so the gear was break even
which means fuck it we do not want to buy all new s21 xp
which do 270 th at 3500 watts
they burn 84 kwatts or 4.20
and they earn 270 x 4 = 10.80
they could run 2000 making 6.60 on each one or 13200 a day
but 2000 s21xp cost about 14 million.
do i want to lay out 14 million to clear 13,200 a day
comes to 4.7 million a year which means more than 3 years to get back the 14 million
or sell all of it maybe 600,000 for the s19 gear and call it a day.
if the s19 were paid off the 600,000 is profit.
the way mining is going I rather take the small profit.
i guess it all depends but if your total net worth was 14 million then i'd say you're taking a huge risk if you did that. a dumb risk even. i'm not sure it's a good risk under any circumstances unless you have some type of insurance that guarantees you against a loss.
smart miner you are.
I looked up the cost of a used asic s19 90th in russia at retail. The price is $300 with bargaining.
It is difficult to sell wholesale 2280 used asics s19 for 263 dollars wholesale. And also need to factor in the cost of shipping and customs services.
do they come with power supplies or do you have to buy those separately? the logistics seems very messy. i don't think its feasible for shipping. the cost is too high and you will never recoup your investment. landfill time.