Kenyan energy company entices Bitcoin miners with geothermal power

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Kenyan energy company KenGen is calling on bitcoin miners to move nearby and buy its excess renewable energy capacity.

KenGen claims that 86% of its energy is generated from renewable sources, mostly geothermal from pockets of ground source heat in the Great Rift Valley. Local news outlet The Standard reported that KenGen has space in its new industrial park in Olkaria, near its major geothermal power station, that can be rented out to bitcoin (BTC) miners.

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The acting director of geothermal development at KenGen Peketsa Mwangi said that his company was keen and eager to bring miners to Kenya home.

“We’ll keep them here because we have the space and the power is near, which helps with stability.”

Despite their enthusiasm, there have yet to be any reports of miners wanting to move to Kenya.

Cambridge’s Bitcoin Electricity Consumption Index (CBECI) shows that the East African country currently has no known bitcoin mining operations, but appears to be ideal for miners due to the region’s estimated 10,000 megawatts (MW) of geothermal energy potential. it happens.

KenGen is currently operating at a maximum generation capacity of 863 MW after setting up another geothermal power plant in April, according to Kenyan financial news outlet Capital FM.

By inviting miners into the country, KenGen may be able to accomplish multiple goals at once. This could enhance the environmental sustainability of miners, which has come under much scrutiny around the world. According to CBECI, mining consumes 119.5 terawatt hours (TWh) per year, more than the entire country of the Netherlands. Only 31 countries consume more energy.

It could also drive demand for more development in KenGen’s power grid to increase aggregate supply and reduce costs. Kenya currently has the 12th most expensive electricity in the world, according to Statista, with a kilowatt hour (KWh) costing around $0.22.

The high cost of electricity in the country may be due to its electrification rate. According to the World Bank, by 2020, only 70% of the population had access to a centralized grid. Energy grid tracker Energypedia states that Kenya’s high cost to connect to the grid is a “major impediment” to its expansion.

The Kenyan government could also enjoy more revenue from miners through fees and even taxes. For example, the government of Kazakhstan is set to generate more than $1.5 billion in revenue from miners over the next five years (although this only increased to $1.5 million in Q1 2022).

related: Bitcoin Daily Mining Revenue Falls to Eleven Month Low in May

Kenya enjoys a particularly high rate of crypto adoption by peer-to-peer transaction volume.

The Central Bank of Kenya (CBK) has been exploring its options with the central bank digital currency since last year. CBK in February cited lower fees and faster transfer rates as benefits of using a CBDC.