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How Bitcoin mining increases electricity theft in Malaysia

07 Mar 2022 : 12:14
2 min read
  • Tenaga Nasional Bhd, the local utility regulator, has noted an increase in illegal cryptocurrency mining since 2018
  • Cases of theft increased from 610 in 2018 to 7,209 in 2021, Tenaga reports
  • The local utility regulator has made two proposals to curb the practice

Electricity theft in Malaysia by Bitcoin miners cost power companies hundreds of millions of dollars in 2021.

Sharp rise in illegal mining of cryptocurrencies

Tenaga Nasional Bhd, the local utility regulator, has noted an increase in illegal cryptocurrency mining since 2018. According to President and Chief Executive Officer Baharin Din, this trend is expected to continue. Mining is not illegal per se in Malaysia, but some miners steal electricity by altering the installation of a meter or bypassing the meter altogether to make an illegal connection.

Cases of theft increased from 610 in 2018 to 7,209 in 2021, Tenaga reports. Tenaga has been working with police, the Energy Commission, local municipalities, and the Malaysian anti-graft industry to apprehend electricity thieves, particularly among Bitcoin miners. So far, eighteen people have been arrested for stealing $550 million worth of electricity.

What is the solution?

The local utility regulator has made two proposals to curb the practice. The latest proposal calls for the introduction of a special tariff for Bitcoin mining operators to combat electricity theft. It also proposes that the energy regulator encourage Bitcoin miners to apply for a legal electricity supply license.

Technology can also be a solution to combat this theft. Smart metering, meter data management systems and digital power quality products allow for better monitoring, control and planning of the entire power system. This should also be able to reduce the incidence of theft. Automated monitoring of meters and supply and demand could have prompted authorities to intervene more quickly.


About Author

Stan Colenbrander

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Stan is the head of news and podcast host at Cryptonary. He was formerly a member of the Cryptonary Pro community. In early 2021, he decided to drop out of journalism school at university to pursue journalism in real life and make an impact in the crypto space. . His areas of interest include the NFT industry, decentralised finance, and crypto start-ups.

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