30 Nov 2021 · 2 min read

Russian Governor Who Slated Miners in October Now Plans to Welcome Them

Source: AdobeStock / Ekaterina Shvaygert

The Governor of a Russian province who just weeks ago was blasting crypto miners has now offered to help them set up shop in the region and provide support for people mining tokens.

As reported in October, the Irkutsk Region Governor Igor Kobzev called on the Russian Deputy Prime Minister and key power sector policymaker Alexander Novak to help him fight an “avalanche-like spike in energy consumption” in Irkutsk, which is quickly becoming a mining hotspot.

In October, Kobzev stated that underground mining had already increased tenfold compared to 2019 figures, and warned that networks in Irkutsk were struggling to cope with increased load. He squarely blamed underground crypto miners for power outages in suburban areas, where he claimed many were secretly operating.

The Russian government has responded by indicating that it will seek to create legal definitions for mining-related terms and order miners to pay slightly higher electricity rates than ordinary residents. And this appears to have satisfied the Governor – who now seems to have become positively pro-mining.

Interfax quoted Kobzev as stating that mining should be classified as “entrepreneurial activity.” He spoke about providing them with designated sites for their “industrial activity.”

The news agency quoted him as stating:

“As you know, I turned to the Deputy Prime Minister of the Russian Federation. And [I] consider [mining] to be an entrepreneurial activity. The government has its own opinion on this matter. It looked at [our complaints] and supported us.”

In fact, it seems that as long as miners are happy to work in conjunction with the authorities, they will have Kobzev’s blessing.

As winter gets started in Russia, networks could face big challenges: most residents in the Irkutsk region use electricity to heat their houses, with electricity deriving from sources such as thermal power and hydroelectric energy.

But Kobzev stated that if miners work directly with the power companies they could actively reduce the load on the distribution networks of urban areas.

He said:

“We are ready to provide miners with platforms for industrial mining. For example, in Ust-Ilimsk. But this must be done in an orderly way, so that they make use of separate lines that will not cause a strain on [town and city] networks.”

The town of Ust-Ilimsk is home to the Soviet Union-era 3,840 MW Ust-Ilimsk Hydroelectric Power Station, as well as a thermal power plant.

The River Angara runs through the province, and also powers two other major hydroelectric plants: the 4,515 MW Bratsk Hydroelectric Power Station and the 687.1 MW Irkutsk Hydroelectric Power Station.

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