European Union’s Action Plan on Digital Energy Might Affect Cryptocurrency Mining
Europe is facing one of its most challenging times with the escalation of the war between Russia and Ukraine, which has plunged the region into an energy crisis. In response, the European Union (EU) plans to wean itself off Russian oil and transform its energy industry.
EU Proposes Digital Energy System
Energy supplies to the EU bloc have been dominated by Russia for centuries, but things are about to change. Immediately after Russia invaded Ukraine, the EU and its allies imposed an economic embargo on it. Russia responded by cutting off its energy supply to the rest of Europe, causing the region’s worst energy crisis.
Due to high energy demand and low supply caused by rising prices, the Commission proposes digitalizing the energy sector. In this way, consumers can save more money on their energy bills.
Moreover, introducing intelligent buildings, smart meters, and internet of things (IoT) devices will allow users to monitor their energy consumption and increase the integration of renewable energy alongside other cost-saving measures.
In the meantime, the Commission pursues its commitment through legislative processes, investments, and collaborations with member states. The short-term goal is to ensure seamless communication between various parties through the use of digital technology. Domestic energy sources such as solar and wind turbines can also benefit consumers.
Will the Action Plan Impact Cryptocurrency?
Since crypto mining has made headlines over the past few years because of its energy consumption, the EU’s latest move will likely have an impact on the industry. In addition, the energy demand for cryptocurrency has increased by almost 900% in the past five years, representing 0.4% of global electricity consumption.
To highlight the environmental and climate impacts of emerging technologies like digital assets, the EU will develop a comprehensive report by 2025. Furthermore, the information will also include measures to mitigate the adverse effects of crypto mining on the environment.
The Commission has called on member countries to reduce the electricity consumption of crypto asset enterprises in line with the new council regulations on emergency interventions in light of the current energy crisis.
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