Iran Power Generation, Distribution and Transmission Company (Tavanir) announced new restrictions on supplying electricity to cryptomining centers for three months.
In a letter to the miners, published on way2pay website, the major utility said it will provide mining farms power between 12 a.m. to 7 a.m. over the next three months, when summer power consumption reaches peak.
It notified miners that they must completely turn off their machines from July 6 to August 6, as they will not be supplied with power even during the night in the month as temperatures soar.
Cryptomining centers that use renewable power and those that have participated in Tavanir initiatives for renovating electronic devices are exempt from the restrictions and will operate normally.
First Vice President Mohammad Mokhber in November said new rules for crypto assets are in the making in addition to those approved in 2019.
As per the rules, cryptominers are obliged to receive special permits from the Ministry of Industries, Mining and Trade for importing equipment and the approval of the Iran Standard Organization for using them.
Later, the government outlined details about supplying power to mining centers. Licensed miners have been given options for using electricity, including the establishment of on-site renewable power plants, or using their own small generators.
Miners using electricity and natural gas pay their bills based on power export tariffs and are obliged to reduce operations by half in the summer.
Electricity prices for cryptomining are subject to currency rates at Nima – the currency platform where forex is purchased by importers from exporters.
New rules require the ministries of oil and energy to announce power rates on a quarterly basis and inform miners about peak season adjustments well in advance.
In past regulations, tax breaks were offered to miners who repatriated their earnings to the country. However, the government later ended the exemption and treats cryptominers like other exporters.
Cryptocurrency mining centers can be established in the free trade zones where local authorities are in charge of licensing instead of the Industries Ministry.
Among other things, the new regulations state that mining crypto assets by using power (natural gas or electricity) allocated for any other purpose is illegal and those in breach will be penalized.
Stringent Rules of the Past
Before imposing penalties in the past, Tavanir used to confiscate all illegal cryptomining equipment, cut electricity and oblige offenders to pay for damages inflicted on the national grid.
Tavanir has urged policymakers to tighten the rules targeting illegal miners and insists that “the existing regulations are not preventative enough.”
According to the utility company, more than 7,200 unauthorized cryptomining centers have been identified and shut since 2020, which used 3.84 trillion rials ($16.5 million) in subsidized electricity and inflicted 380 billion rials ($1.3 million) in damages on the national grid.
Observers, however, say the new rules do not go far enough in addressing loopholes and preventing losses. The Majlis Research Center, the powerful research wing of the parliament, has taken a stance on the negative impact of the government’s regulations on cryptomining and dismissed them as an exercise in futility.
Like previous regulations, the new rules only cover mining of cryptocurrencies and extends the ban on trading cryptos.
"Traders should take responsibility for using cryptos and beware that the risks will not be covered or compensated by the government and banks," it said.
The Central Bank of Iran is tasked with developing a platform through which licensed miners can sell their cryptos to pay for imports.
