Experts criticise miner-focused amendments to Ukraine’s energy legislation

Members of the Verkhovna Rada of Ukraine рассматривают the possibility of lowering electricity costs for mining centers. However, the requirement for their minimum capacity at 100 MW makes the project unpromising, experts say.

Changes to the Law “On the Electricity Market” establish rules for entering into direct contracts for electricity supply at prices below market rates.

Про внесення змін до Закону України «Про ринок електричної енергії» by ForkLog on Scribd

According to the current version of the document, the total projected capacity of the data-centre electrical installations must be 100 MW or more. This corresponds to the consumption of roughly three large shopping centres or the capacity for about 50,000 ASIC miners, experts say.

The bill is primarily aimed at attracting investment, says Natalia Drik, head of the Blockchain Association of Ukraine (BAU).

“But for investments, security of the jurisdiction, ease of bringing in and withdrawing funds, the price of equipment, clear, unchanged rules and a legal environment understandable to investors — none of these points exist in Ukraine.”

Innovations in the energy sector are coupled with bureaucratic, complex procedures for approving projects and bringing them into operation, adds the head of BAU. Therefore, for the initiative’s success, the entry point must be very simple and flexible.

“The 100 MW threshold is a clear reluctance for the project to succeed. The maximum figure Ukraine should discuss is 10 MW. And if a real investor for larger capacities appears — that would be great,” notes Drik.

The Deputy Minister of Digital Transformation, Oleksandr Bornyakov, agrees that the bill needs to be refined.

“In terms of the minimum capacity, it would be ideal to cut this requirement in half — to 50 MW,” he told ForkLog.

The Ministry of Digital Transformation is ready to participate in the drafting of the document and believes it will positively affect the mining sector.

In May, the Ministry of Energy of Ukraine tasked state-owned Energoatom with studying the possibility of mining cryptocurrencies on the capacities of nuclear power plants.

The ministry later explained that mining would sustain guaranteed loads at the nuclear power plants and attract additional funds.

Experts at the time noted that due to government incompetence and the inability of the market to operate freely, the initiative was doomed to fail.

Subscribe to ForkLog news on Telegram: ForkLog Feed — all the news, ForkLog — the most important news and polls.