GeoBitmine on Wednesday asked the Idaho Public Utilities Commission to reverse its decision approving a new Idaho Power rate for cryptocurrency facilities that the company contends could kill its pending project in the state.
The rate approved June 15 by the Idaho PUC is discriminatory and includes provisions that are unworkable for GeoBitmine, including the possibility of having power cut off 225 hours a year and the utility’s “unfettered and unsupervised discretion” on what facilities must take the rate, according to the company.
Idaho Power is reviewing GeoBitmine’s request and didn’t have any comment, Jordan Rodriguez, utility spokesman, said Wednesday, noting the company will file a response with the Idaho PUC.
The issue centers on GeoBitmine’s plan to build a cryptocurrency mining facility that would provide waste heat for a high-capacity indoor farming operation at an idled potato processing plant in Aberdeen, Idaho, according to the company’s request for reconsideration at the Idaho PUC.
Idaho Power recently told GeoBitmine it would sell electricity to the project under the utility’s new “Schedule 20,” which is designed for cryptocurrency operations, GeoBitmine said, noting its facility would have an estimated 6 MW of load.
Idaho Power developed the rate after it received inquiries from potential cryptocurrency mining customers with almost 2,000 MW of potential load, according to the PUC’s decision approving the rate. The utility, which had its highest-ever peak load a year ago of 3,751 MW, told the PUC that serving cryptocurrency mining customers threatens Idaho Power’s ability to serve its customers when electric demand is highest.
“The company explained that attributes of cryptocurrency mining operations were: (1) high energy use and load factor; (2) the ability to relocate and disaggregate equipment to obtain favorable rates; (3) volatile load growth and load reduction; (4) sensitivity to short-term economic signals or volatility; and (5) lack of demonstrated financial viability,” the PUC said in its decision.
In its decision, the PUC encouraged Idaho Power to continue evaluating its assumptions on the risks and need for mandatory interruptible service, the need for non-interruptible service through special contracts or other options for customers with loads below 10 MW, and the need for marginal cost-based rates.
GeoBitmine said its project, which would include a University of Idaho seed research initiative, requires a year-round, reliable source of electricity that is available and priced like that sold to Idaho Power’s other large customers.
Indoor farming and the planned seed research program need around-the-clock power, according to GeoBitmine. The threat of power interruptions makes it impossible to finance the project, the company said.
Also, being charged marginal energy rates “exposes GeoBitmine and its waste heat off-taker business partners' operations to the vagaries of the volatile and typically very expensive unregulated spot markets for electricity,” the company said, adding that none of ldaho Power's other rate schedules are based on marginal energy prices.
Further, the project doesn’t meet the criteria for Schedule 20, which is for facilities that could relocate quickly, because the planned facility is effectively a co-generation project tying cryptomining activity to the expected indoor farming and research operations, GeoBitmine said.
The rate for cryptocurrency operations is discriminatory, according to GeoBitmine.
“It is black letter utility law that the commission may not approve, and utilities may not charge, rates that treat customers preferentially or to disadvantage some customers to the benefit of other, similarly situated, customers,” the company said.
Last year, the U.S. Court of Appeals for the Ninth Circuit upheld a special rate for cryptocurrency mining operations that was put in place by the Public Utility District No. 2 of Grant County, Washington, after its load jumped when cryptocurrency companies set up operations in its service territory.