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Comment by FartyMcFarter | Hacker News Reader

Maybe it would make more sense to you, but not to most people I think. Electricity has much better uses than cryptocurrency.

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Of course it does. It also has better uses than say gaming, so if that is the logic maybe that should be banned, too.

Gaming isn’t a major contributing cause to a country’s energy crisis.

Does it have better uses than a regular Kazakh citizen being able to use the light bulb in their apartment? Or their fridge?

There is a difference between the two. That's like comparing the fuel use or exhaust of a Fiat 500 to that of a cargo ship.

Under your analogy we shouldn't regulate car exhausts before we regulate cargo ships. At any rate, article says 250k mining devices there so the electricity usage is likely more from mining but not orders of magnitude more, and even if it was it would suggest they are not banned because of how useful it is (arguably gaming is even less useful) but because of size. But sure compare to gaming + TVs then.

Analogies are meant to be used once. You shouldn't take them and use them for another purpose.

All big scale BTC mines buy at industrial prices.

You cannot run a mine bigger than what your wiring can support in your apartment.

None of them is using the subsidised residential rate.

Residential rates are not typically subsidized, they are regulated and billed at cost plus. The only thing that can be called a subsidy is a delay in raising costs. When local utilities are required to supply at a fixed price and that fixed price is less then cost + fixed profit margin, then they are losing money. The remedy for this is to ask their regulators to change the fixed price to account for both the higher expected base rate and their losses during prior periods. The utility commissions which regulate them almost always grant such requests. In extreme cases, CA power crisis, this can bankrupt utilities but in simple shifts of the demand curve most utilities have great credit ratings and can borrow to cover opex during the shortfalls.

This is true in the US generally as well as some countries with already very low energy generation costs. For developing nations residential electricity is normally subsidized.

It is https://www.globalpetrolprices.com/Kazakhstan/electricity_pr...

There being a price difference between business and residential does not imply a subsidy. It can simply cost more to distribute electricity to businesses, the time power is supplied may be different, and the nature of what is supplied may also be different. Commonly (in the US) businesses have larger supplies, three phase power, and lines and transformers may be buried or harder to access. Midday electricity is also more expensive typically and businesses use more electricity midday (which is why it is more expensive). Further, businesses may be charged real time rates while residential rates lag spikes in price or are averaged over time.

That said, Kazakhstan may subsidize their power, I don’t know.

Kazakhstan's residential utility subsidies are 3% of country's GDP.

Are industrial prices not subsidized?

Certainly not, industrial use subsidises the residential. And businesses have to pay for their grid connection to the premises.

If only we had an open, decentralised mechanism to figure out what's a better use of a limited resource is.

Oh wait. That's exactly what "cost" is.

Yup, I'm sure that every time we've let the market do its thing, nobody suffered. I don't really want to get into too much of what's very gross territory, but let's say that a long time ago a certain nation controlling another nation decided that the food from said controlled nation was economically most useful being sold somewhere else.

The locals couldn't afford the "cost".

I'll let you put 2 and 2 together for the rest.

> a certain nation controlling another nation decided that the food from said controlled nation was economically most useful being sold somewhere else.

> The locals couldn't afford the "cost".

That sounds like one of the many soviet famines, which happened exactly because there wasn't an open and free market for said food.

Ireland. It was Ireland.

Yeah, "cost" is one of the fundamental terms of economics. So is "externality".

What's the externality of using electricity?

Depends on the situation. If there's a shortage (or near-shortage) of supply, the externality could be causing a partial or total blackout.

Pollution (most electricity production is still coal-based), raising electricity prices for everybody else, contributing to an ongoing energy crisis (electricity is going to start being rationed in Kazakhstan).

Electricity is a finite resource.

Except that mechanism optimizes for profitability, not for social good.

In this example it prioritizes made-up computer money for already rich people over a Kazakh citizen having heating or being able to refrigerate food.

It's a terrible mechanism for most things.

Put down your Ayn Rand novel for a second and gain some empathy. A few rich crypto miners pricing many people out of electricity is inhumane.

Easy, just require an pricy mining permit that can be used to build renewable infrastructure.

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