Texas Mandates Registration for Cryptocurrency Miners to Ensure Grid Reliability

Texas has enacted a rule requiring cryptocurrency mining facilities above 75 megawatts to register with ERCOT, disclose location and power demands. This aims to improve grid reliability amid rising electricity consumption. Existing operations must register by February 1, with penalties up to $25,000 for noncompliance. ERCOT predicts electricity demand could double by 2030 due to increasing mining and industrial activity.

The Texas Public Utility Commission has implemented a significant new regulation requiring cryptocurrency mining facilities connected to the state’s primary electric grid to register with the Electric Reliability Council of Texas (ERCOT). This mandate arises from a 2023 legislation and targets installations consuming over 75 megawatts of power, necessitating them to disclose their location, ownership, and anticipated electricity demand.

The burgeoning crypto mining sector has substantially increased electricity consumption in Texas, raising concerns over grid reliability. The newly instituted rule aims to facilitate monitoring of electricity usage, ultimately aimed at safeguarding the power grid’s stability. PUC Chairman Thomas Gleeson emphasised the importance of adapting to the evolving industrial landscape to ensure dependable and affordable power for Texans.

Existing mining operations are required to complete their registration by February 1, with an obligation to renew annually. Facilities must provide expected peak power requirements for the next five years alongside their actual electricity use from the previous year. Noncompliance may incur penalties of up to $25,000 per day for each violation.

Classified as “large flexible loads,” these crypto operations possess the capability to rapidly modify their energy consumption, enabling them to switch off computing equipment during peak grid strain. As of July, ERCOT reported estimates indicating that these facilities could consume around 2,600 megawatts of electricity, mirroring the usage of Austin. New facilities expected to set up shop in Texas could contribute another 2,600 megawatts.

This escalating electricity demand, coupled with interests from data centres and other industries in the Permian Basin, has led ERCOT to project a potential doubling of electricity demand in Texas over the next six years. The power grid reached a peak demand record of 85 gigawatts last year and is forecasted to escalate to approximately 150 gigawatts by 2030.