11.08.2025 20:47
Ethiopia's electric power authority, the Ethiopian Electric Power (EEP), has implemented a moratorium on new cryptocurrency mining permits. This decisive action aims to alleviate strain on the nation's power grid and prioritize domestic energy needs over the expansion of foreign-owned cryptocurrency mining operations.
Driven by concerns regarding the country's energy sustainability and the escalating pressure on its electricity infrastructure, the EEP acted swiftly to curtail further growth in the sector. The decision follows reports indicating that cryptocurrency mining currently accounts for a staggering 27% of Ethiopia's total electricity consumption. This significant energy demand stems from the availability of cheap hydropower, largely generated by projects like the Grand Ethiopian Renaissance Dam (GERD), a factor that initially attracted numerous cryptocurrency mining firms.
Prior to the moratorium, approximately 25 cryptocurrency mining companies had established operations within Ethiopia, with nearly 20 more awaiting permits. The EEP's initial strategy involved selling surplus, or "stranded," electricity to these companies in foreign currency to bolster national revenue. However, the substantial energy consumption has sparked criticism, highlighting the inequity of prioritizing foreign firms' profits over the unmet energy needs of millions of Ethiopians, particularly those in rural areas lacking consistent access to electricity.
This situation underscores a broader challenge facing several African nations with abundant renewable energy resources. While Ethiopia's hydropower capacity is growing, meeting domestic electricity demand remains a persistent struggle, especially during peak hours and drier seasons. The EEP's statement emphasizes the considerable difficulty of ensuring a reliable and affordable electricity supply for all citizens using renewable sources. This moratorium reflects a difficult balancing act: harnessing the economic potential of renewable energy while simultaneously ensuring its equitable distribution among the population. Similar challenges are likely to be faced by other African countries, such as Kenya and Ghana, where cryptocurrency mining is also developing.
