- Texas now requires crypto mining facilities to register, aiming to safeguard grid reliability and manage energy demand.
- PUCT’s new rule enforces location, ownership, and power data sharing by Bitcoin miners connected to the ERCOT grid.
- Non-compliance with Texas’ crypto mining rule may lead to daily fines of up to $25,000 for unregistered facilities.
The Texas Public Utilities Commission (PUCT) has approved a new rule designed to regulate cryptocurrency mining throughout the state. The decision follows growing concerns about the toll the facilities put on the state’s power grid.
Effective November 21, the rule mandates that all virtual currency mining facilities connected to the Energy Reliability Council of Texas (ERCOT) grid register with the commission. Moreover, once facilities have connected to the grid, they must provide information about their location, owner, and electricity demand within one business day. Registration renewal is required annually by March 1.
Rising Energy Concerns Prompt Regulation
Texas has become a hub for cryptocurrency mining after China banned the practice in 2021. Miners migrated to Texas, drawn by regulatory flexibility and ample energy resources. However, the industry’s energy-intensive operations have caused noise complaints and concerns about grid reliability. Residents near mining facilities report disruptions and health issues due to constant noise and power fluctuations.
Currently, Texas is home to five of the ten largest Bitcoin mines in the United States. Combined, these operations consume over 1,200 megawatts. During times of peak energy use, the ERCOT-managed grid is stretched, and their high energy demands often occur at these times.
PUCT Aims for Energy Stability
PUCT Chairman Thomas Gleeson emphasized the importance of the new rule. Moreover, he stated that tracking mining facilities’ locations and energy requirements would ensure ERCOT maintains reliable power for all Texans. He noted that this step reflects the commission’s efforts to adapt to evolving industrial demands.
Those who fail to comply with the registration rule will be subjected to penalties. In addition, class A violations can result in up to $25,000 per day for violators.
Crypto Mining’s Broader Implications in Texas
The move comes as Texas lawmakers continue to debate cryptocurrency’s role in the state’s economy and energy landscape. Advocates, including Senator Ted Cruz, see Texas as a potential hub for digital currency innovation. Cruz has pledged to support a favorable regulatory environment to attract investment and job creation in the cryptocurrency sector.
The new registration requirement highlights the state’s balancing act between fostering innovation and ensuring grid reliability for its residents.
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