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Sweden Hopes to Benefit from Norwegian Mining Exodus

Swedish media have reported that the country is expecting a wave of interest from crypto mining companies currently conducting business in Norway, due to the Norwegian government cutting tax subsidies from January 2019.

Norway’s government is putting more pressure on cryptocurrency mining by following through with the threat that it was considering removing electricity tax subsidies on Bitcoin mining. Currently, Norwegian Bitcoin data centers are discounted in the same ways as other industries with high energy costs paying NOK 0.48 (USD 0.056) per kilowatt. This will now rise to NOK 16.58 (USD 1.94) per kilowatt from January 2019.

The effect of this could be a shift to the nearest Scandinavian location with a similar climate and Sweden would be the obvious choice. With Swedish data centers paying significantly less in power costs than the new tariffs being imposed next year in Norway, Sweden is preparing for an exodus of crypto mining outfits.

The Swedish municipality of Boden in Norrbotten County, the northernmost county or län, has a mining community of about ten companies at present. Erik Svenson, director of the Boden Business Agency, maintains that these numbers are now sure to swell, and suggested that companies in Norway were already contacting his agency regarding mining in the area. He said:

“It is clear we’re becoming more attractive… This about big money… and its definitely going to make it cheaper here.”

Svenson said that they had already started building a business park in Boden in anticipation of the growing interest in cryptocurrency mining and other business and hundreds of jobs were likely to be created. Currently, there are a few hundred people employed in crypto mining.

The Norwegian government has lost one of its biggest players in the market due to its punitive tariffs. Bitmain has announced that it will be moving to Sweden or Denmark as a result of the 2019 change in electricity tariffs. Julie Hvideburg, head of Bitmain’s Norwegian operations, commented:

“Government policy is pushing the industry in pushing the industry out of Norway. We are a global company and can move to Sweden or Denmark, but our Norwegian partner loses a big contract.”

 

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