Iran Power Generation, Transmission and Distribution Company, Tavanir, announced new severe measures to discourage unlicensed cryptomining.
According to the company spokesman, Mostafa Rajabi Mashhadi, fines have increased 400% in the new regulations, which means "unlicensed cryptominers must pay their electricity bills at rates four times higher than electricity export rates that already is 100 times higher than the subsidized rates for households."
"Access of first-time offenders to subsidized energy, including electricity, natural gas and liquid fuels, will be cut for three months," he said, adding that this will be cut off for one full year for repeat offenders, the Energy Ministry's website quoted him as saying.
In July 2019 the government said it would accept cryptomining as a legal industry. Miners were obliged to acquire license from the Ministry of Industries and pay their electricity bills based on export rates.
However, illegal farms have cropped up with increasing speed using subsidized electricity because they must pay much higher tariffs if they operate with a permit.
When power shortages increased last summer, Tavanir started shutting illegal cryptomining units.
Before implementation of the new penalties, the utility used to confiscate illegal cryptomining equipment and cut their electricity. Offenders were also required to pay for damages to the national grid.
Tavanir has urged policymakers to further tighten the rules targeting illegal miners and insists “they were not preventive enough.”
Last month the utility announced a new plan which calls for prison terms for illegal miners caught for the second time.
"Unauthorized consumption of electricity by crypto farms is not different from smuggling fuel from the country, as it has similar negative impacts on industries and public welfare," Rajabi Mashhadi said.
According to Tavanir, more than 7,200 unauthorized cryptomining centers have been found and shut since 2020. Earlier it said that illegal miners used 3.84 trillion rials ($16.5 million) in subsidized electricity and inflicted 380 billion rials ($1.3 million) in damages to the national grid.
According to Rajabi Mashhadi, if cryptomining is detected in places owned by state organizations or the public sector, those responsible will face the law and be suspended from government jobs.
Recently cryptomining in public premises has become a sensitive issue, especially after detection of hardware in the Tehran Stock Exchange building.
Last October local media published reports about cryptomining equipment found at the TSE premises. The Securities and Exchange Organization and Tavanir confirmed the reports which resulted in the ouster of some TSE officials.
Cryptomining hardware seized henceforth from unlicensed farms will be demolished, the utility spokesman said.
Last year, the prosecutor-general’s office banned the release of seized equipment of unauthorized cryptominers until the Majlis passes legislation on how to deal with the illegal miners.
The latest measures come after a recent report by the Majlis Research Center, the research wing of the parliament, over “the impact of failure of the government ban on cryptomining and closure of unauthorized mining centers.”
The report was published on the MRC website, in which the measures were dismissed as simply unsuccessful because it had no visible change in the total cryptomining business in Iran.
“Estimates about cryptocurrency mined in Iran between April 2021 and August 2021 shows that more than half the illegal miners were indifferent to the government’s decision to ban cryptomining,” the report noted.
