Ethiopia Cuts Bitcoin Miners' Power Amid Hydropower Shortages

Ethiopia has drastically reduced electricity deliveries to Bitcoin miners due to hydropower shortages. According to Bloomberg, El Niño intensified dry conditions in the east African country, reducing water inflows into its reservoirs by 20%. As a result, Ethiopian Electric Power (EEP) CEO Ashebir Balcha said the company cut power to miners to prioritize households and manufacturers.

The reduction was initially set at 75% of contracted levels, then eased to 50%, before being lowered again to 23%. EEP will reassess conditions in October and may impose further reductions or even restrict electricity exports to neighboring countries. Bitcoin miners reportedly accounted for 35% of EEP's revenue last fiscal year and consume almost one-third of Ethiopia's electricity output.

The country's inexpensive hydropower has attracted international miners, including Phoenix Group, which expanded its Ethiopian mining capacity to 132 megawatts in April 2025. Economist Saifedean Ammous also warned that global Bitcoin mining electricity consumption and capital expenditure may have peaked in 2024-2025.

Ammous stated that Bitcoin's price would need to rise more than 18.92% a year just to keep the dollar value of newly mined coins growing, even before accounting for dollar depreciation. He also cited competition from artificial intelligence data centers as an alternative way for miners to monetize their electricity connections and infrastructure.