Electricité du Laos (EDL), the state electricity distribution company, has cut off power for crypto mining operations in the country, citing a shortage of electrical energy due to ongoing drought conditions. The first half of 2023 has been marked by extreme heat, causing a surge in electricity demand and hindering the performance of hydroelectric power plants, which generate 95% of the country’s electricity supply. As the country’s reservoirs dry up, its ability to support energy-intensive industries like crypto mining is also diminishing.
Striking a Balance: The Dilemma Between Domestic Needs and Export Goals
The drought has not only affected electricity supply at the national level but has also put a dent in Laos’ future export ambitions. The announcement by EDL comes at a critical moment as the company had plans to export large quantities of electricity to Thailand by 2024. Adding further pressure to an already strained system, an EDL employee cited another factor affecting the decision:
Many crypto mining companies have failed to settle their outstanding balances.
This reversal throws a wrench into Laos’ recent foray into crypto mining, which was launched in 2021 as a public-private initiative to attract businesses relocating from China due to regulatory crackdowns.
