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Norway has comparatively cheaper electricity for cryptocurrency mining centres due to the tax deduction on electricity used for mining, but now it will end here.
The cryptocurrency mining industry in Norway was encouraged in 2016 by providing cheap electricity. However, mining centres got involved in the over-exploitation of electricity instead of producing renewable energy. On the other hand, the demand for energy for other sectors is increasing in Norway, resulting in a shortage of electricity in the country.
No Extra Burden
A proposal by the left-wing Red Party in May this year to increase the electricity tax to discourage and ban energy-intensive mining of proof-of-work cryptocurrencies was rejected in parliament. Now the government has decided to eliminate the only tax deduction.
With the end of the tax exemption, electricity rates for mining centres will become similar to rates applicable to other service industries. That is, it does not put pressure on the crypto industry in any way, but equilibrates it in front of other industries.
Thoughts
If the crypto industry continues to consume available energy rather than producing renewable energy, its very existence will be called into question in the future.
