Bitcoin Mining Helps Sustain Zambia’s Energy Grid, Supporting 15,000 Residents

• A mining company is reported to be tapping into an excess hydroelectric power in a remote region of Zambia to mine Bitcoin.
• The company is working in partnership with a local hydropower plant, which was established to provide power to 15,000 people. 

One of the strangest Bitcoin mining operations has been uncovered in a remote northwest region in Zambia, around its border with the Democratic Republic of Congo, tapping the hydroelectric power generated from the Zambezi River to produce new blocks. According to the entrepreneur behind this initiative, Phillip Walton, the “thundering roar” of the river is “the sound of money.”

Walton is reported to operate in a shipping container made up of 120 computers. The facility has also partnered with a local power company, Zengamina Hydro-power, with which they directly share revenue. Explaining why they chose to set up in a remote part of the country, Walton disclosed that this would enable them to capitalize on a cheaper power.

The Zengamina hydro-power was reported to have been built in the early 2000s from a $3m donation. The site is said to be run by a British-Zambian, Daniel Rea, who led the establishment of the project to power a local hospital. Currently, it provides power to around 15,000 people. However, the “slow take-up from the community” has affected the full utilization of the generated power.

Speaking on the collaboration with the Bitcoiners, Daniel explained that the power company used to waste about half of its energy, implying that it was unable to make enough earnings to meet its operating expenses. According to him, the recent collaboration with the mining facility has been a game changer.

The company being run by Walton is called Gridless. Our research shows that it has successfully set up six similar sites in three African countries, underscoring its ability to effectively utilize surplus power.

More About the Bitcoin Mining Operations of Gridless

The Bitcoin mining facility is said to generate 30% of the plant’s revenue, contributing to the significant reduction in prices for the local town. Currently, each mining unit is reported to generate around $5. However, this is adjustable based on Bitcoin’s market value.

While this operation has significantly benefited both parties, things are expected to change in the future as the Zengamina plant prepares a grid connection expansion. Technically, this would reduce the reliance on Bitcoin mining. However, Gridless could also make use of its experience to set up self-sustaining hydro facilities.

Commenting on this, co-founder of Gridless Janet Maingi highlighted that its innovative approach outlines the potential for generating economic growth.

They’re focusing on so-called run-of-river hydroelectric models like at Zengamina and the continent has an abundance of untapped hydro potential. We believe in creating a consumer-driven energy model that ensures affordable, sustainable energy access for African communities.

Gridless is also disclosed to have faced challenges from authorities and companies who strictly oppose Bitcoin mining for its high energy consumption. Meanwhile, the World Economic Forum believes that Bitcoin mining in African National Park could be a catalyst for green energy and sustainable job creation, as outlined in our previous blog post.

As reviewed in our recent publication, other countries, including Pakistan, are exploring similar initiatives to reduce excess electricity. In a previous article, we also discussed the decision of El Salvador to fully utilize the country’s volcanic geothermal energy to mine Bitcoin instead of transporting them to other cities or losing them to oversupply.

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