5 ms·
Those bargain rates are possible largely because the Basin’s five dams generate around six times what the region can use locally. Much of the surplus is exporte
by Semirhage 8y ago
Those bargain rates are possible largely because the Basin’s five dams generate around six times what the region can use locally. Much of the surplus is exported, at premium prices, to outside buyers such as Puget Sound Energy, and those outside sales subsidize local rates.
But if the utilities are selling more of their power to local Bitcoin miners, they’re exporting less power at those premium prices, which makes it harder to keep local rates low. Further, because much of the surplus is currently committed in long-term contracts, supplying miners with all the megawatts they want might require the utilities do something virtually unprecedented: buy power on the open market, at prices far above what locals have come to expect.
Solution: pass a law to charge miners export prices. It’s not as though Bitcoin mining helps the local economy, so you either return revenues to pre-mining levels, or drive the leeches out. Either outcome is equivalent.
- tradedash 8y agoWhy is the solution to everything "pass a law"? there is an ocean of possible solutions to this problem yet people somehow always jump to "pass more laws" before other options are considered. I find that rather weird.
- matte_black 8y agoAgreed, they should just straight up cut off power to miners if they want them to go away.
- iovrthoughtthis 8y agoEverything looks like a nail when you've a hammer in your hand.
- bnegreve 8y agoWhat are the other solutions?
- trophycase 8y agoBecause when you live in a "civilised" society such as ours, an individual has no power outside of asking those with power to do things for us.
- wpietri 8y agoThese are public utilities, so changing their rate structures so significantly could well require legal changes. And if the solution is outside the utility, then it definitely requires legal changes, as then we're in to the realm of business regulation, and American business regulation is generally of the style of "everything is allowed except for these specifically forbidden things that have proven to be bad". Of course, if you'd like to propose some less intrusive solution I'm sure both we and the people of Central Washington would be all ears.
- deleted 8y ago[deleted]
- seunosewa 8y agoAlso, unless there is a law compelling them to charge miners the same prices, a new law is not needed. The utility can just implement it as a price policy.
- skybrian 8y agoThis is like asking why the solution to bad software is to commit more code. It's because the way to fix a bad law is to pass another law. Otherwise you're saying we should keep the bad laws we have and work around it some other way. Sometimes fixing the symptoms actually is better, but it's not surprising when people suggest changing the code.
- abecedarius 8y agoPatches on top of patches are not the only way to maintain software.
- MBCook 8y agoThere are externalities that they want to control for some people but not others or through a means other than a price hike on everyone.
- Faaak 8y agoSolution 2: don't subsidize prices. Problem solved.
- MichaelApproved 8y agoPrices aren't being outright subsidized. The other states who don't have the foresight of creating enough power for their own citizens have to pay premium prices to the states that properly planned infrastructure. The situation is being taken advantage of by miners who can exploit low rates that couldn't realistically be planned for when power production infrastructure was being created.
- UncleEntity 8y agoThe other states did plan ahead by getting long-term contracts for power, probably makes more sense to buy excess hydro-power than building a coal fired plant locally. Now they find they can't supply export power and local power because their crystal ball didn't predict there would be a power hungry technology moving in.
- DenisM 8y agoThere might be a challenge in wording the law properly. Miners might claim they are “content creators” or “scientific labs” to avoid the law, leading to protracted litigation. But yeah, raise the prices I say.
- tomhallett 8y agoI was just wondering about this - are the miners being charged taxes on the revenues generated?
- d0ugie 8y agoAccording to this Q&A from the IRS, yes, miners are on the hook: https://www.irs.gov/pub/irs-drop/n-14-21.pdf https://www.irs.gov/pub/irs-drop/n-14-21.pdf: A-8: Yes, when a taxpayer successfully “mines” virtual currency, the fair market value of the virtual currency as of the date of receipt is includible in gross income. (...) A-9: If a taxpayer’s “mining” of virtual currency constitutes a trade or business, and the “mining” activity is not undertaken by the taxpayer as an employee, the net earnings from self-employment (generally, gross income derived from carrying on a trade or business less allowable deductions) resulting from those activities constitute self-employment income and are subject to the self-employment tax.
- BrandonM 8y agoThat's only federal tax. I don't think Washington has state income tax. And generally only large cities have local income tax.
- dahdum 8y agoIf you are going to forego energy neutrality, why stop with the bitcoin miners? Could they charge controversial businesses like adult entertainment more as well? Since they sell excess above local prices, all local usage drives up local prices.
- mark_edward 8y agoEnergy neutrality? Every utility has differential industrial and residential and commercial pricing, and energy discounts are super common for localities to lure development. China is the extreme end, where some places actually get free power, but even here there's all kinds of discounts our special rates. What do you think Amazon is trying to get cities to grovel for? Special tax discounts, energy rates, whatever they can get.
- dahdum 8y agoAs far as I know differential pricing is based on classes like industrial vs commercial and applied fairly. Incentives for development are super common of course, and controversial in themselves. This would be different though, targeting a business to pay more than other commercial enterprises. That's a targeted disincentive, and if not structured generically and applied fairly it's bad policy. Seems hardly different than Comcast deliberately slowing Netflix down, not to extract revenue, but to put them out of business.
- mark_edward 8y agoIt's just the opposite of targeting a business to pay less than other enterprises, which happens all the times as development incentives. I don't think it's any worse policy than that, it's just the flipside. In this case, due to the fact that by taking the town's total usage up, they raise the costs for everyone in the town, you could also just see as internalizing an externality.