Topic: No Electric Supply to Bitcoin Mining Operations in Laos (Read 400 times)

Laos has stopped providing electricity to cryptocurrency miners because they consume a lot of electricity, which means there is not enough electricity for everyone. It is also not good for the environment, especially when the country depends on hydroelectricity. If  it doesn't rain enough, the situation could be even worse. Above all, you have to think about money and rules. even though cryptocurrency mining can make money, it must be controlled so that not to cause trouble for other important things.

China crack down on Bitcoin mining caused a Great Hashrate Migration to other nations like USA, Iran, Kazhakstan, ... and the network as well as Bitcoin price are all fine years after that migration which is bigger than any migration of Bitcoin miners from Laos.

Surely what is happening in Laos won't have big impacts.

Hashrate recovers after Great Migration

When there is no sufficient amount of electricity for the common people, and the government stopping the supply for mining operations is right decision. As Laos is a small nation and the contribution through its mining to the network is really small. For this reason bitcoin market isn't affected.

If these countries had got big mining operations, price might've varied big. Whenever something similar (like ban of mining) happens, the mining operation in those countries used to get shifted to the nearby country. This time such move haven't taken place.

      -  At that point, they can't do anything because that is the jurisdiction and authority of the government in Laos. And I think the government has the right to do that. Anyone who is no longer able to pay correctly for electricity will have their supply cut off unless they pay on time.

Then we know that when it comes to Bitcoin mining farms, you can really expect that the number one high cost is electricity. And you should always be ready to maintain the payment there every month. But if that's not the reason and there is just a lack of sources to produce energy, there are other ways, like solar energy or solar panels.

Hydropower is considered renewable and thus eco-friendly. It's great that Laos relies on a good source of energy, and it's also nice that miners are trying to use it rather than burn coal, so it's sad to hear that they will no longer be allowed to use it. The reasoning for halting electricity supply makes perfect sense, though, as hydropower relies on water, which makes droughts a big problem. There's also a claim on unpaid debts by mining companies, and if that's the main reason to choose to cut them off, it makes sense to me even without the drought.
But if it's a small thing, are there any other businesses that are being cut off? Surely there are other similarly non-essential enterprises, and they all should be treated equally if they consume similarly high amounts of energy?

Laos belong to Mekong delta nations with China and in China mainland, we know they usually have big changes in rain, flood seasons. I agree with your opinion on likely impacts of drought on power supply especially hydroelectric supply in those nations. Laos is at nearly the end of Mekong delta so it has more impacts from drought than China.

Bitcoin and cryptocurrency mining is not what governments care most for their national economy and related industries that need electricity supply. When their nations' electricity supply has problems, they have reasons to temporarily cut supply to Bitcoin and cryptocurrency mining farms.

Bitcoin mining difficulty posts biggest drop since ASIC era

What is the way out of this sad situation? Well, it can't be all that sad. There are alternative sources besides the use of solar panels. You can take them into account. Of course, I am not very familiar with this state, but there are no hopeless situations.
Yes, the main production of electricity is hydropower. One of the most productive in the country, but which does not meet current needs. This country should consider all options. In fact, I didn’t even think that everything was so bad in this process. This is the engine of economic indicators, and here it is.

If there's a severe drought in Laos and the country can't import electricity at affordable prices, then reducing the electricity supply to crypto miners is justified. I don't believe that the authorities in Laos are using the drought as an excuse to shut down the electricity supply to the crypto miners. If the situation continues I don't think that there will be problem for the crypto miners to just move to another country.
I don't have any data about the capacity of crypto mining facilities in Laos, but I can assume that the mining power is insignificant.

Here is the energy tab from the CIA factbook (amazing resource)

https://www.cia.gov/the-world-factbook/countries/laos/#energy

It seems they have coal but have zero production of petroleum and natural gas, but some google-fu points they just don't have any. They have pipelines to import NG but is seems the burn their own coal (I get it)

https://www.iea.org/countries/laos

They don't have any wind or solar power to speak of but those could augment the grid and lower the demand on hydro preserving more of the capacity. But never expect a commie country to do smart things. Mining bitcoin with scarce resources is not a wise idea.

Laos is a very small country and lack of natural resources, they don't have coal, natural gas, or oil, they rely on hydropower plant as their main source for electricity which is very not effective when the dry season come and adding the current heatwave situation they are really in bad condition. I bet it's even difficult for Laos to keep the supply for a less power demanding business, let a lone crypto-mining which required much power. I think if anyone want to create a crypto mining business, the should consider choosing a country that has more natural resources that can be converted into electrcity.

Forecasting the weather these days is becoming difficult because of global warming and other environmental problems. Maybe it is the first time they are experiencing such drought. My country has never been experiencing flooding but recently flood is now a major problem. But I think the government should give these miners more time to secure other means of getting power. But I will advise these miners to pay the bills they owe instead of seeking other means of getting power because they are more expensive.

How would that even work in practice?
If miners would pay more than the other countries then what stops miners from going to Thailand now and paying there more than in Laos as Thailand will still get electricity cheaper than what miners pay in Laos?

Second, there si real data with clear numbers and this is for 2021 before electricity hit sky-high prices, so 2021 Laos exported:
24,399 GWh and received $1.96B, which goes to a relative price of 8.2 cents/kwh. Do you honestly think miners would pay more than that?
And those are 2021 numbers, not 2022 when everything went everywhere at least 20%-30%  more expensive!
Wealth...common!

Miners pay more than neighbor countries, and less electricity is wasted in transmission lines. This is clearly rejecting wealth in exchange of some political favor.

If the government of Laos don't want to provide electricity to these companies, then they have to look for other means to provide electricity to facilitate there Bitcoin mining activities. This is as a result of natural disaster which have inflicted serious decline in the production of electricity through hydro electric means. The government would have made proper preparation since they get there tax from this means so prevent a big loses to these companies since they will no longer be able to mine Bitcoin and do other activities that would have keep  contributing to the use of Bitcoin.

If this is indeed the case, then it wouldn't be fair to blame the government. Electricity is undeniably very important and if they're unable to allocate additional electricity for mining then it is how it is.

There are priorities to consider, and bitcoin mining might not be at the top of the list. Generating electricity is far from cost free; it depends on a nation's resources and various other factors. However, I believe that if you were to establish your personal power plant relying on renewable energies, solo mining might become viable. Yet, it's worth noting that this would necessitate a huge investment, as far as I know.

I think this makes sense, since one of the foundations of the economy in Laos is based on the strategy of generating electricity from rivers and selling the energy to its neighbors. This means that hydropower is an important source for the national economy and since cryptocurrency mining projects in the country harness a large amount of the electrical energy that is obtained From hydroelectric power stations, it is therefore logical for the government to stop providing electrical power to these projects in the season of water scarcity.

The fault is mainly the fault of the mining companies that do not provide suitable alternatives for electric power in the season of water scarcity or in any other cases in which the electric power suddenly stops.

Denial of Service, for whatever reason, is why any serious participant in the Bitcoin Network should operate in nomad-friendly manner, independent of centralized systems and according to Bitcoin ideals. Being nomad friendly means you are light/mobile as possible, ready to move to another location when necessary, to survive in dangerous/uncertain world with many adversaries who could try to harm or capture you & make you their slave.
Having large hard-to-move cryptocurrency hardware concentrated on a single spot, and worst still, depending on centralized system isn't a good idea. Small mining business should be hard to spot. The large ones could be securely outsourced to multiple people in different locations.

Yeah but there is also other thing like they are not paying the bills on time. So I am pretty sure they why the government has taken the steps to do this. Miners should have been very careful about this while they were avoiding their bills to pay. There are so many countries that are already banning the mining operations and not allowing even on the individual levels. Unfortunately we are hearing the news where miners themselves trying to kill their own approvals with their own deeds.

Either they should rely on the green energies or may be they should build alongside business of solar farming to have it. Either way it’s gonna cost them same.

There is no mystery and everyone knows it!
Without a grid and a plan for the government where you feed excess energy and get back electricity at night with whose credits it's impossible to mine efficiency with just solar. Batteries are expensive, you will destroy them with 1 full cycle per night, you need way more than your 24 consumption because you might have two consecutive days without sun.
Trying to shut down every day once the sun if out is again a pain in the ass, you're going to extend the time your ROI to twice or thrice that, meaning you're gear will be older and older, less efficient compared to the others so they might even break before that.

Also, the capital needed, you need to sink a ton of money on top of the mining gear and other costs, with cheap grid energy you can throw more money at gear, be fast to ROI and think from then, with solar, you might even buy those panels for nothing, you might end up not mining at all as the returns are minimal and you will have nothing to do with the produced electricity, so you're going to take another hit selling used solar panels.

It is high time for mining companies to consider self-sufficiency in electricity supply. Why has this issue not been resolved yet? There is also an option to at least partially satisfy the demand for this resource through solar panels. Every year this technology becomes less expensive and even a small enterprise is able to afford it. Why hasn't it been done yet? For me it remains a mystery. Provided that this problem is so acute and well known about it.
Will this resource come out cheaper and will it be beneficial for the company? This can only be obtained from employees. Nevertheless, this method or other sources of alternative energy should be taken into account.

There are actually nothing wrong with this, because the government allowed Bitcoin mining operations to use excess electricity that was generated in the rainy days and now the weather have changed and there are no extra energy that can be used for Bitcoin mining.

The government's first priority are to provide electricity for domestic and industrial use and we all know Bitcoin mining takes a lot of electricity, so it is just a good decision to stop it. 

It is not stated what caused the mining company to fail to pay debts, maybe they are affected by the crypto price which has not improved this year.
The Lao government cannot be blamed for this, because indeed the impact of weather changes is not only happening in that country but throughout the country, so many things must be adjusted, and securing electricity for the people and also maintaining exports will certainly be a top priority, even though they previously gave permission these companies to operate but the changes that are happening in the world make them have to make adjustments and default on debt is another cause of this supply cessation.

If this is really the case, then for sure the government will really halt it, meaning there are tons of reasons why it is probably not profitable for those companies to mine Bitcoin, and also for sure they've got problems with power outages that make them lose more. Though right now they are wanting to preserve or have more energy on electricity as we know that they are in shortage, which is also one of the reasons why they close it down.

The last time this map was updated was in January 2022. We can't really use it anymore, data are totally outdated.

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Otherwise, to answer to OP, I don't think it's a problem, these kinds of events happen all the time. So it's not surprising that it happens there, if it's true that big mining companies don't pay their monthly electricity bills. And even if they are paying, the current drought would justify this too. The same thing happens from time to time elsewhere too, when conditions don't allow much electricity production, the miners are shut down for a while.

Every time this happens the hashrate relocates somewhere else, and so on. Nothing to worry about in my opinion.

And when I am a government I will stop the electricity when there is debt waiting to be repaid for long period and also I will tax them so it could benefit the country


Yes I agree with you since the country not contributing much and still has debt to repay from the mining companies i think no electric supply is best way and power can goes to priority line like school and hospital

Well, they're in a position to choose their priorities given the circumstances that they're in. They can't cater everybody anymore. I think it's fair enough to let go of the cryptocurrency mining business rather than compromise the needs of its own people.

Also, this is probably temporary. When the drought is over or, if it's true, if the companies have already payed their debts, they could probably resume their operation.

In the face of competing demands and limited supply, Bitcoin mining might not come as a priority in any country. It's understandable. There's nothing wrong with it. Even the Texas miners will have to shut down their operation at times when there's high grid demand.

They should already have a primary solution by using other renewable energy sources such as solar, wind, and biomass systems.
The Lao government has already thought about this and ensured energy security to overcome the power shortage due to the long dry season.

Laos currently has 90 energy plants across the country, with a combined installed capacity of nearly 11,000 megawatts.
This also includes 77 hydropower plants, 8 solar power plants, 4 biomass schemes, and 1 coal-fired power plant.

So the bitcoin industry is not an important industry, so there is no electricity supply for Bitcoin mining in Laos.

Yes, that also seems to be the problem that made the electricity supply stopped.

“Another reason we must suspend supplying electricity to cryptocurrency mining businesses in Laos is that they are unable to pay their outstanding electricity bills,” an EDL employee told Laotian Times.

Source: https://laotiantimes.com/2023/08/25/laos-suspends-power-supply-to-cryptocurrency-mining-businesses/

Governments shutting down mining when it starts to threaten the stability of the energy grid is nothing new, it happened many times before in other countries.


This has nothing to do with communism, there are few if any countries on this planet that would allow a private business to take electric power for themselves at the expense of the population. People hate blackouts and they would easily overthrow a government, even an authoritarian one, if it can't guarantee them the most basic living conditions.

Actually rivers in Africa are anything but scarce. The Nile river is a famous example. Not enough rainfall though, is another thing.

Now I don't know if the Blue Nile even passes through Laos, but most of these countries are making use of hydropower for their electric loads, so they are just cutting power to non-essential industries if they can't generate enough to satisfy everyone, which seems fine to me.

And there is something about debts not being repaid either so that is also an additional factor to consider.

Is it always like this, or this is the first time they have experienced a drought in the dry season? If I'm not wrong, most countries in SEA have the same seasonal changes, so the earliest rain should be expected to come in around October. If they had this in mind, I believe they should have planned it earlier and told miners to use other sources of electricity as soon as the dry season hits.

My bad, the correct country is Thailand. Thank you.

The drought has already lasted for six months and export capacity is already decreasing. The statement from Electricite du Laos (EDL) is that it will no longer supply power to these mining facilities. Two things might make them change their mind which is if they experience an improvement in rainfall or if the miners prove their importance to the Laos economy by paying electric bills when due.

Laos is not located in Africa but in the Southeast Asia. It is bounded by Thailand, China, and Myanmar. The part of Africa that experiences drought is East Africa mainly the area called the Horn of Africa which includes countries like Kenya, Somalia, and Ethiopia. Some other parts have access to rivers and have hydropower dams for electricity. Mining in Africa will be difficult because of the high cost of electricity and unstable power supply.

I say that he is not sure that electricity will be cut, he said "if" and in any case Africa is a very hostile country to use hydroelectric power especially in areas where water is scarce and there are no rivers.

We hope the drought eases off very soon and things can return to some degree of normalcy. There are more important things than allowing a miner to take electricity that have been used to help the general public and the miner only get a reward from it.

I can hardly fault the decision of the government to prioritize necessities over mining. There are thousands of other miners around the world and the void will be filled easily

Doubt that, probably Thailand, not Taiwan!


And what do you think the citizens would want?
Keep powering the miners that with each machine burns around 72kwh per day while the average person uses 2kwh a day?
And for what, $7 a day in revenue, that will mostly go to a few businessmen while half of the population risks blackouts?
Get real, if it were a referendum anywhere in the world, including in Salvador in such a  case there will be a 90% vote to shut them down!

Rights, what rights? The right to have your power shut down while some miner is making money with dirt cheap energy?


Solar is the most expensive option for any miner, nobody can mine on solar cycles, batteries are expensive as hell and without a grid and subsidies you have no chance to break even.

The government of Laos are just trying to ensure that they have enough electricity for next year to maintain the signed memorandums of understanding that they have with countries around them, so that they be able to meet up with the demands of these country that they export this their hydro generated electricity to since they are one of the major hydroelectric generators in Asia. Electricity sale is one of the countries major export from which they generate capital from, and since the cryptocurrency mining operators have failed to meet up with debt that they owe the government, it is unprofitable for them to continue supplying them with electricity.

Cryptocurrency mining operators will face a major challenge with power when they are cut off.

The government took the right decision to halt the power supply. The country is going through a drought and their major source of power is hydro-powered plants. The government would have to give electricity to important sectors of the economy and one of them is to export power to Taiwan. The article confirmed that the mining plant is not paying its electric bills regularly. So the government prefers to supply power to areas that can generate income. Bitcoin mining farms should look for alternative sources of power if they still want to be in business or pay up their debts which might make the government see miners as an important source of revenue.

These types of events are what must be taken into account when you want to start mining Bitcoin, not only legal issues can prevent a good flow of these operations, a large part of the countries generate their electricity based on hydroelectric plants, located in rivers with large water capacities that allow supplying an entire country, and this despite being good since it is occurring naturally and sustainably, it can have its defects when climate changes become drastic and produce extreme droughts, reducing this process and causing electrical failures and therefore affecting mining......And of course other sectors considered more important such as hospitals.....

But even if this happens and the reduction of bitcoin mining in that country is not so compromising as to destabilize the general market, i believe that they can take other measures to be able to continue with their work and not harm the government's decisions as such, i believe that everything Anyone who wants to get involved with this work must be prepared with other alternatives or at least have another option to support this type of event.

Very well, I am not saying that the Miners should not be facilitated with cheap electricity, I'm just commenting on the policy by the ELD as they're taking export capacity and their own utility into account rather than an unnecessary load, Bitcoin is still hanging between the LEgal and Illegal tender so for now in the government policies we'll count it in the private load, where if a good dinner is spending a lot of money on the machinery by just having a few difficulties he can arrange the self-generated electricity. I am not familiar with the geographical conditions of Laos, my comment is general for all.

Sticking to the topic if the government is not ready to supply electricity for Bitcoin I think it directly doesn't mean that they trying to discourage BTC mining because Minner can have enough capital to produce electricity from Solar or start a private power plan at least I'm taking 10,000 TH/s in general. If they are discouraging the self-produced power so the case is different until they've allowed you the self-power mining you can mine BTC freely.

Another offtopic view

As for here in our country we produce the world's most expensive electricity even though we have better environmental resources, we have better hydropower opportunities, Solar but as for now our maximum plants are on Fuel, The Government is generating 56RS per unit of electricity after subsidies, providing the electricity to the consumers around 32RS 34RS per Unit on average and not costing taxes to the over users unit costs same for the 1000 unit consumers and 300 unit consumers.

Haha well, still people are paying...

This has been happening over the past years in China. Mining in China has stopped several times due to the dry season, either because of high electricity prices or because the authorities have restricted electricity consumption. The mining farm can be seen from the activity of electricity consumption and the Internet, even those that include good insulation can be known.



https://asiatimes.com/2019/12/dry-season-offensive-against-china-bitcoin-miners/

Sometimes it may come to the closure of the farms and sometimes to fines, but soon the miners move to other places.
The article is dated 2019 and you can see the impact in the hash-rate here:

So the government has another reason why they wouldn't supply a electricity to the mining operation. It is also a common sense that the Laos government will prioritize important necessity in their country like schools, hospitals and government facilities, removing power sources from crypto miners who are basically a business that consume a lot of electricity would be the first option. Most of the government would probably do the same because the crypto mining business that they aren't supply isn't contributing much to the economy of their country.

Laos is a small nation that is located in the South Eastern part of Asia. The percentage bitcoin mining compared to the rest of the world is very minimal. Country that is much dependent on hydropower and unable to meet the necessity due to the shortage of water resources and limiting the supply to bitcoin mining operations is not a big issue and this doesn't affect the market.

Laos is a small nation and it follows communism so its government can do many things while their citizens have very power to ask for their rights.

Cambridge Bitcoin Electricity Consumption Index and Bitcoin Mining Map show that Laos is not a big nation in Bitcoin mining. In Bitcoin Mining and Energy Statistics does not have description about Laos in Bitcoin Mining.

It had Bitcoin mining but is small in hashrate and it won't impact the Bitcoin network a lot.

Well, if that's the actual case then we can't blame the government really! Electricity is a commodity which requires money to produce. So if the mining companies are failing to pay their bills, the government has taken the correct course of action.

Crypto mining operations across the world needs to be self-reliant when it comes to electricity. Otherwise it's a huge risk as we are seeing here.

"Lao authorities said that cryptocurrency mining operations have failed to repay mounting debts."

besides the problem of insufficient electricity, they also have unpaid debts until now, maybe this is an excuse for the government to cut off the electricity supply to their business. because a good and profitable company certainly has an electricity generator which they can use to support their business, even though turning it on is expensive but it shouldn't paralyze their business, unless this mining company has complex problems and is on the verge of bankruptcy.

Well if you don't have the water then something has to be done. I would consider mining a sub critical load. Nothing bad is going to happen if they stop mining. Power goes out to hospitals, schools, airport, business and such you have a much bigger problem. They do the same in Texas during extreme events.

EDL has declared a halt in providing power to cryptocurrency mining ventures in Laos. The majority of the country's electricity, sourced from hydropower plants, will no longer be supplied to these operations. In September 2021, the Laotian government granted permission to six companies for cryptocurrency trading and mining.

The Governor of EGAT said that if the drought in Laos becomes severe, hydropower plants in Laos will generate less electricity, reducing export capacity.

https://en.vietnamplus.vn/laos-stops-power-supply-to-cryptocurrency-mining-businesses/266967.vnp

What do you guys think about this?