Because of Norway's recent budget change, which will discontinue the discounted electricity tax rate of 0.48 øre for cryptocurrency mining companies starting January 2019, multiple Norwegian mining outfits are faced with challenges. Sweden, Norway's Scandinavian neighbor, may offer a solution.
Erik Svensson, CEO of the Swedish data center company Boden Business Agency, has confirmed crypto businesses' interest in setting up shop in Sweden. "They know where we are," he said.
Svensson added that interested companies frequently visit Boden, the municipality where Svensson's agency is located. Boden currently houses about 10 businesses involved with crypto mining. Also, the country's tax for data centers, such as mining operations, is around 0.5 øre per kilowatt-hour, close to the subsidized rate in Norway.
One of the companies reconsidering its options after Norway's forthcoming tax change includes Troll Housing, which was slated to establish a data center in Fræna, Norway, in mid-December. However, the company lost a hefty contract with a foreign operator two days after the 2019 budget was agreed upon.
Another company, Bitmain – a major player in the mining space – received a recommendation from its Norwegian partners that its mining operations in the country be discontinued. The company is looking at potentially relocating its Norwegian office. "We are a global company and can move to Sweden or Denmark, but our Norwegian partner loses a big contract," said Julie Hvideberg, international sales manager at Bitmain, according to local news outlet E24.
She further noted that because of the tax shift, it would be difficult to stay and expand Bitmain's Norwegian location. Sweden, she believes, is an attractive alternative.
Although the anticipated increase in electricity tax payments is projected to provide Norway with 10 million kroner ($1,160,500 as of press) in extra income, folks like Svensson argue that data centers, including mining operations, have positive effects on the economy.
"As a result of revenue and activity in the [Boden] municipality, we have started building Boden Business Park, where we will create hundreds of jobs," he said.
Whether crypto mining businesses decide to remain in Norway or relocate to a neighboring country, there appear to be various options in the Nordic region. Besides Sweden, Iceland also boasts low electricity rates. According to data compiled by EliteFixtures.com, the cost to mine 1 bitcoin was about $4,746 in Iceland as of January 2018, as opposed to over $10,000 in some countries.
Translations by Google.