Earthjustice says Hearings on Cryptomining in Lawrence County set, lots of threats to public power bills

Hi, Mark.

I hope this finds you well. I’m reaching out on behalf of Earthjustice. There are two hearings coming up this month as part of investigations launched by the Public Service Commission into controversial proposals from Kentucky Power that would give two crypto mining companies massive energy price discounts for facilities in eastern Kentucky, based on questionable claims that they will provide economic benefits to local communities. These types of operations are extremely energy-intensive and environmentally harmful and have the potential to leave ratepayers with higher energy bills.

The two hearings are:

July 20: Hearing on proposed discounted rate contract between Kentucky Power and the proposed Ebon International facility in Louisa (more info below).

July 25:  Hearing about a similar proposed contract between Kentucky Power and the Cyber Innovation Group’s Rockhouse facility in Pike County.

At some point before the hearing, would you like to talk with Thom Cmar of Earthjustice, who is one of the attorneys representing the public interest groups who asked the Kentucky Public Service Commission to launch the investigation? You could also or instead speak to one of their clients Josh Bills with the Mountain Association, an economic development and energy advocacy group based in Berea, KY.

There is little economic benefit to the two communities while putting the other utility customers, including families, at risk of footing the bill for lost revenue and adding capacity to the grid.

Here’s some more information about the deal with Ebon International. The company is based overseas and plans to spend nearly $250 million to build a cryptomining facility on the same property as a Kentucky Power gas plant in Eastern Kentucky. It will buy a staggering 250 megawatts of power annually from Kentucky Power, which is almost the entire production capacity of the gas plant. Big Sandy, the polluting fossil fuel plant, was supposed to retire by 2031 but Kentucky Power is now planning to extend its life until at least 2041.

The intervenors represented by Earthjustice in the Ebon case are Mountain Association, Kentuckians for the Commonwealth, Appalachian Citizens’ Law Center, Sierra Club and Kentucky Resources Council. The Kentucky Attorney General and a group of industrial electric customers also oppose the deal. The proposed contract would allow Ebon to use massive amounts of electricity at a lower rate than other customers, creates risks that other customers will see their bills go up due to the cost of supplying additional capacity to the facility, and would allow Ebon to avoid property taxes under the terms of its lease with Kentucky Power.

This month’s hearings follow a hearing that the PSC held on May 31 involving a similar proposal from a different utility, Kentucky Utilities, which is seeking to provide an affiliate of Alliance Coal over $4 million in subsidies for a cryptomining facility in west Kentucky that projected it would have no more than 5 employees.

The hearings will be broadcast online and will include testimony and cross examination of the Kentucky Power witnesses and expert witnesses for the other parties.

I can also send you a fact sheet on cryptocurrency mining in Kentucky if this email address is the best one to use?

Thanks much,
Valerie

More background

Bitcoin mining companies have already set their sights on Kentucky as a place to extract cheap electricity from fossil fuels, with more cryptocurrency mining capacity than any other state besides Texas. Kentucky produces more carbon dioxide pollution from cryptocurrency mining than any other state. Kentucky passed a law last year that waives taxes on energy purchases by cryptocurrency mining companies,

The intervenors argue that there is no evidence the crypto companies need the giveaways to attract them to set up shop in Kentucky. In essence “you had me at hello” because the non-discounted rate is lower than most other states and there are retiring coal and gas plants that are appealing targets for cryptominers to swoop in, get their life extended so they can gobble up the energy for years.

Earthjustice released this white paper on the impacts of crypto mining nationwide:

https://earthjustice.org/press/2022/earthjustice-and-sierra-club-release-comprehensive-guide-to-environmental-impacts-of-cryptomining