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Kenyan energy company entices Bitcoin miners with geothermal power

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Kenyan energy company KenGen has put out a call to Bitcoin miners to move nearby and buy its excess renewable power capacity.

KenGen claims 86% of its energy is generated from renewable sources, mostly geothermal from pockets of ground source heat in the Great Rift Valley. Local news outlet The Standard reported that KenGen has space at its new industrial park in Olkaria, near its flagship geothermal power station, which could be rented to Bitcoin (BTC) miners.

The Acting Director of geothermal development at KenGen Peketsa Mwangi said that his company was willing and eager to have the miners call Kenya home.

“We’ll have them here because we have the space and the power is near, which helps with stability.”

Despite his enthusiasm, there have not yet been any reports of miners looking to go to Kenya.

Cambridge’s Bitcoin Electricity Consumption Index (CBECI) suggest that the eastern African nation currently houses no known Bitcoin mining operations, but it appears to be ideal for miners due to the region’s estimated potential 10,000 MegaWatt (MW) of geothermal energy capacity.

KenGen is currently running at a maximum generating capacity of 863 MW after installing another geothermal power plant in April according to Kenyan financial news outlet Capital FM.

By inviting miners to the country, KenGen may be able to accomplish several goals at once. It can increase miners’ environmental sustainability, which has come under great scrutiny around the globe. Mining consumes 119.5 TerraWatt hours (TWh) per year, more than the entire country of the Netherlands, according to CBECI. Only 31 countries consume more energy.

It may also drive demand for more development in KenGen’s power grid to increase total supply and reduce cost. Kenya currently has the 12th most expensive electricity in the world where one kilowatt hour (KWh) costs about $0.22 according to Statista.

The high cost of electricity in the country may be due to its electrification rate. By 2020, only around 70% of the population had access to the centralized grid according to the WorldBank. Energy grid tracker Energypedia states that Kenya’s high cost to connect to the grid poses a “major obstacle” to its expansion.

The Kenyan government could also enjoy greater revenue through fees from miners and even taxes. The Kazakhstan government, for example, is poised to earn as much as $1.5 billion in revenue from miners over the next five years (although it only raked in $1.5 million in Q1 2022).

Related: Bitcoin daily mining revenue slumped in May to eleven-month low

Kenya enjoys an especially high rate of crypto adoption from its volume of peer-to-peer transactions.

The Central Bank of Kenya (CBK) has been exploring its options with a central bank digital currency since last year. CBK stated lower fees and faster transfer rates as benefits of utilizing a CBDC in February.