Iran cryptocurrency mining and energy consumption

The Iranian Parliament has moved to address the impact of illegal cryptocurrency mining on the nation’s energy resources. In early September, lawmakers approved an urgent bill to amend the Islamic Penal Code to combat the illegal use of electricity for mining. Alireza Salimi, a member of the Parliament’s presiding board, reported that illegal mining causes approximately $2.5 billion in annual losses and consumes 3,750 megawatts of electricity, an amount equivalent to the consumption of four provinces.

Subsequent reports from the Majlis Research Center provided more specific data regarding the strain on the power grid. The center estimated that cryptocurrency mining consumes between 930 and 1,200 megawatts, representing roughly 14% of the electricity deficit during peak summer demand. To sustain these operations, Iran would require an estimated 8.46 billion kilowatt-hours of electricity and 2.1 billion cubic meters of gas-equivalent fuel annually, creating a fuel burden of approximately $1.5 billion based on diesel-import costs.

While the Majlis Research Center noted that mining is not the primary cause of the power deficit, Tavanir, the state utility, provided higher estimates, suggesting consumption could reach 2,000 megawatts and account for up to 20% of the current deficit. The situation is further complicated by heavily subsidized electricity rates that lower mining costs in Iran relative to global averages.