Hadsel residents now face $280/year in extra electricity costs after shutting down a local Bitcoin mine.
Bitcoin miners are struggling with rising energy costs and reduced rewards, pushing them to pivot towards AI and HPC sectors.
Core Scientific's $6.7B deal with CoreWeave showcases the growing synergy between AI and Bitcoin mining for future growth.
Residents of Hadsel, Norway, saw a sharp rise in electricity costs following the shutdown of a local Bitcoin mining center. This closure, prompted by complaints about noise from residents, has caused electricity bills to jump by an estimated $280 per household annually.
The mining facility contributed to 20% of the local power company's revenue, creating financial strain after its closure. Climate tech venture capitalist Daniel Batten criticized the decision, arguing that shutting down Bitcoin mining operations can negatively impact electricity costs for communities.
https://twitter.com/BullishTimes_/status/1835175015702012392 Mixed Reactions to Bitcoin Mining Operations
The Hadsel mine consumed approximately 80 gigawatt hours (GWh) annually, which equaled the energy consumption of around 3,200 households. Despite the short-term relief from noise pollution, residents are now dealing with the unintended consequence of higher energy costs. Mayor Kjell-Børge Freiberg acknowledged the situation, adding that the town is actively seeking alternative projects to offset the lost energy consumption and stabilize prices.
Besides Hadsel, other Norwegian towns, like Sortland, have experienced similar frustrations with Bitcoin mining centers. Noise complaints have frequently been reported, but some local experts argue that media coverage often exaggerates these concerns. Kjetil Hove Pettersen, CEO of KryptoVault, emphasized that only a small percentage of the population voices these grievances, which tend to dominate media narratives.
Bitcoin Mining Firms Explore New Avenues
Moreover, Bitcoin miners worldwide are facing increasing economic pressure. Besides the rising costs of energy, technological advancements are forcing miners to upgrade their systems while receiving lower rewards for the same amount of work.
The latest Bitcoin halving in April, which reduced new Bitcoin issuance by half, has triggered financial difficulties for major mining companies like Marathon Digital and Riot Platforms. Consequently, many mining firms are diversifying into sectors like artificial intelligence (AI) and high-performance computing (HPC) to stay afloat.
This pivot has been particularly successful for companies like Core Scientific, which, after emerging from bankruptcy, has secured a $6.7 billion deal with CoreWeave, an Nvidia-backed AI firm. Core Scientific's success highlights the increasing convergence of AI and Bitcoin mining.
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