Norway has become a small Bitcoin mining hub that attracts companies focused on using renewable energy.
When we hear about Norway in the context of Bitcoin, it is usually to compare the electricity consumption of mining with that of some countries. For example, like the Forbes post where it put Norway as an example of one of the nations that consume less energy than Bitcoin.
However, a new report from Arcane Research reveals that Norway produces almost 1% of the hashrate world of the bitcoin miningAt first glance, 0,77% may seem like a small amount, but considering the size of the country, it is a more than considerable figure.
Who is mining Bitcoin in Norway?
Unlike other mining hubs, such as Texas or Alaska, where we find huge data centers managed by large mining groups, in Norway, the mining hash is distributed among small companies, which generate a total of 120 MW of mining power.
As you can see in the image above, most of the mining companies operating in Norway are local startups like Kryptovault and Arcane Green Data, although there are also some global companies like Northern Data, Bitdeer, COWA or Bitzero.
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Renewable energy and political stability
Why have these groups chosen to operate in Norway? Bitcoin mining is an industry with a intensive electricity consumption. This has caused that, in recent years, the focus of public opinion and legislators around the world has been centered on the high consumption energy, generating a negative view of the industry.
This has caused mining companies to seek to establish themselves in countries and areas where they can take advantage of alternative energy sources.
Norway, thanks to its mountainous geography and humid climate, has been using the hydroelectric power as the main source of electricity in the country. This way, Norwegians have a clean and cheap source of energy, which is ideal for Bitcoin mining.
In fact, except for 2% of the country's electricity, which is produced using natural gas, the rest is renewable energy: 88% is hydroelectric and 10% wind. This means that virtually 100% of the electricity produced in Norway comes from green sources.
On the other hand, Norway has one of the most stable governments in the world and is ranked number nine on the World Bank's list of “Best countries to do business".
Clean energy and affordable prices
One of the main advantages of hydropower is that it has a marginal production price, almost zero. In this sense, in the last five years, electricity prices in Norway have fluctuated between 0,03$ and 0,05$ kWh, except for a period of time in 2020 when the price of a kilowatt hour plummeted to $0,01 due to a season of heavy rains.
On the other hand, Norway has two price zones: north and south. The southern part of the country has slightly higher prices, due to being more connected to the energy markets in the rest of Europe. The northern area, on the other hand, has more affordable prices, due to its greater isolation.
Bitcoin mining and energy recycling
In addition to focusing on the use of renewable energy, Norwegian mining companies are also notable for recycling energy. In this regard, the mining industry is also a key player in the recycling of energy. Bitcoin It produces a lot of heat, something that in a cold country like Norway offers a wide variety of options.
For example, Kryptovault is using the heat produced at its Hønefoss mining operations to dry woodThe company channels the heat produced in its facilities and sends it to a nearby sawmill, where it is used to dry wood that is more than two years old.
Other companies are looking at how to reuse this heat to reduce heating costs in homes, facilitate the creation of heated swimming pools and spa centres, but also for use on farms or greenhouses.
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