Ethiopia Cuts Power to Bitcoin Miners Amidst Drought-Stricken Hydroelectric Dams
Ethiopia has drastically reduced power supply to its bitcoin-mining industry due to drought caused by El Niño, affecting hydroelectric dams. The country's state-owned electricity company, Ethiopian Electric Power Corp (EEP), has cut the supply by three-quarters from July onwards. This move is aimed at supporting manufacturing and households as the nation grapples with reduced water inflows into its reservoirs.
The bitcoin-mining industry accounted for 35% of EEP's revenue in the past financial year, consuming almost a third of Ethiopia's total power production of 9,730MW. Despite cryptocurrency trading being illegal in Ethiopia, Chinese miners have been lured by low electricity costs. The companies have signed power-purchase agreements with EEP, committing to deliver at least 98% of contracted power.
EEP has already reduced the supply from 75% to 50%, and now down to 23%. CEO Ashebir Balcha stated that they will reassess the situation by October and may lower the supply further. The company has also trimmed its export-revenue forecast for this fiscal year by 40% due to drought, revising it to $279 million.