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Russian Church Docked $15,000 for Illegal Bitcoin Mining

A local utility company in Russia ordered a church to pay higher electricity rates, in line with Russia’s existing legislation.

Church Forced to Pay Higher Electricity Tariff

An Evangelical Church in Irkutsk, Russia, which carried out illegal Bitcoin mining, has been asked to pay a one million rubles fine, equivalent to $15,000. According to Today, local authorities visited the rented building used by the church and found mining equipment.

The local utility company, Irkutskenergo, which visited the building observed that the energy consumed adversely affected the local neighborhood. The utility company also noted an increase in power consumption in May 2017, reaching 2 million kWh by August.

Further investigation showed that the church took advantage of the low electricity tariffs offered to private cryptocurrency mining companies. Following Russia’s existing legislation on cryptocurrency mining, however, the church was ordered to pay higher electricity rates.

The protestant church previously paid the requested high rates between May and August 2017, but later felt overcharged and decided to contest in court. The religious body asked a refund of 1.1 million rubles ($16,600), claiming that the local utility company unduly surcharged it.

Furthermore, the local church said that the high electricity consumption was because of the central heating system and its printing office equipment. However, the Irkutsk Regional Arbitration Court ruled against the church, saying that the higher rates charged were rational.

Electricity Premiums for Bitcoin Miners

Bitcoin miners continue to flock into countries with cheap electricity rates. However, some jurisdictions think such an influx is detrimental to their energy economy. Hence, it isn’t unusual to see utility companies forcing cryptocurrency miners to pay higher tariffs.

A research conducted by Alex de Vries showed that Bitcoin mining consumes at least, 2.55 gigawatts of electricity. According to de Vries, this figure could grow up to 7.67 gigawatts, making it proportional to Ireland and Austria.

The city of New York gave its municipalities the right to increase electricity tariffs for virtual currency miners. According to the Public Service Commission (PSC), three virtual currency companies involved in mining use one-third of their local municipality’s load.

One of Canada’s provinces, Quebec, also decided to make electricity expensive for digital currency miners. According to Hydro-Quebec, it was looking for a way to deal with the influx of miners in the province.

Notwithstanding, it was reported in July that New York State regulators were willing to make electricity cheap to attract cryptocurrency miners. State regulators approved a motion that would enable virtual currency miners to negotiate power rates.

Image courtesy of CNBC.

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For quite by chance, I discovered Bitcoin in 2010 and I have been an ardent enthusiast ever since. I enjoy cryptography, mathematics, and theoretical physics. If I am not writing about cryptocurrency, I am attempting to beat my scrabble high score.