Why so few mining farms in NORWAY

[Larson311]

Hi everyone,

I was wondering why there's so few mining farms over Norway while this country has 95% "Green" hydro energy + very cheap kWh (around 3,5 to 4 cts€/kWh).

So far the only mining farm running there is this shady one => https://new-mining.co (with very few information of who is running the project / no page with a brief description of the team / no linkedin profiles etc).

Do you guys have an idea why so few mining farm project is this country despite the very competitive kWh cost? Extra taxes maybes?

Thanks for your feedbacks.

Larson311

 

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[NotATether]

This is because Norway taxes you on your cryptocurrency: https://www.skatteetaten.no/en/business-and-organisation/reporting-and-industries/industries-special-regulations/internet/tax-and-vat-on-virtual-currencies/ , so people making an organization to mine there will have to include their mining revenue in their tax returns and since mining rewards tend to be large, that will eat a significant chunk of profits, which are already on a thin margin in the first place.

Isn't this typical of most countries?

Right. I forgot to mention that they had a tax subsidiary on electricity that was slashed for bitcoin miners 3 years ago. Profit impacts still apply though.

[kano]

This is because Norway taxes you on your cryptocurrency: https://www.skatteetaten.no/en/business-and-organisation/reporting-and-industries/industries-special-regulations/internet/tax-and-vat-on-virtual-currencies/ , so people making an organization to mine there will have to include their mining revenue in their tax returns and since mining rewards tend to be large, that will eat a significant chunk of profits, which are already on a thin margin in the first place.

Isn't this typical of most countries?

[Larson311]

but even with the end of this tax incentive, kWh price for business is around 5,5cts€ / kWh which is pretty competitive for a country in EU.

[joniboini]

Another possibility is that anyone running mining farms in Norway doesn't create a website or publish their business details. Just chilling on their own.

Or, maybe there are no miners living there.

[Larson311]

Another possibility is that anyone running mining farms in Norway doesn't create a website or publish their business details. Just chilling on their own.

Or, maybe there are no miners living there.

ah ah maybe

But you guys agree that 5 cts€ / kWh is a pretty good price for a mining at home activity, right?

[NotFuzzyWarm]

But you guys agree that 5 cts€ / kWh is a pretty good price for a mining at home activity, right?

Yes it would be.
Only problem is that price is only for the large commercial/industrial-level operations that would be pulling a megawatt or more.

[roosbit]

Something interesting I found online https://www.business-standard.com/article/markets/nordic-region-bitcoin-s-green-haven-is-running-out-of-surplus-electricity-121041700536_1.html outlines some of the reasons being tied to growing concerns of carbon emissions.

And according to article above the Nordic region does have mining activities going on, guess they aren't just public about it...

[Larson311]

Something interesting I found online https://www.business-standard.com/article/markets/nordic-region-bitcoin-s-green-haven-is-running-out-of-surplus-electricity-121041700536_1.html outlines some of the reasons being tied to growing concerns of carbon emissions.

And according to article above the Nordic region does have mining activities going on, guess they aren't just public about it...

Very interesting, thanks!

[NotATether]

Something interesting I found online https://www.business-standard.com/article/markets/nordic-region-bitcoin-s-green-haven-is-running-out-of-surplus-electricity-121041700536_1.html outlines some of the reasons being tied to growing concerns of carbon emissions.

It's not really that, what I gleaned from the article is it's mainly about the surplus energy supply running out which caused power plants to significantly raise prices for their electricity for clients (such as bitcoin miners).

[numberslacey]

I agree this could be due to high taxes that are charged by the government on mining which could take a hefty amount of your profits .

[stompix]

but even with the end of this tax incentive, kWh price for business is around 5,5cts€ / kWh which is pretty competitive for a country in EU.

For Eu yeah, definitely.
For the rest of the world the advantage starts to fade, the only thing keeping it up is the cold climate and relative free of natural disasters.
Marathon pays 2.8 cents/kWh in Montana and under 5 cents (5.5€c are $6.5cents) in Texas so there goes the competivity.

But the most important thing is that prices go up and down, depending on the amount they generate, because of the differences in rain it's not out of the ordinary to have spikes in imports, in 2019 imports went up by 50% while exports down by 30%, when things like this happen the increase is directly sent to the consumer. Plus, they have less and less maneuvering space, as NotATether said when you're not having a constant net surplus that allows you t pump tons of water in the pump storage t balance the grid when there are shortfalls you have no option but to raise prices.

As for taxes, what I dislike about Norway is that you're taxed on the value at the moment of receiving coins, so if you mined and got 100BTC at 60k but didn't sell till now it really sucks as you're taxed at $60k not $32k!!