Future

2026

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<p>Russian mining company Algorithm has urged the Ministry of Energy to reject the “take-or-pay” electricity pricing model for crypto mining. The proposal is under discussion in 2026 and could take effect in 2027. The change may significantly impact mining economics in Russia.</p>
<h2 class="wp-block-heading" id="algorithm-sent-a-proposal-to-the-ministry-of-energy">Algorithm sent a proposal to the Ministry of Energy</h2>
<p>Algorithm sent a formal letter to the Ministry of Energy on March 18, 2026. The company criticized a proposed pricing model for electricity consumption.</p>
<p>The draft regulation targets consumers with capacity above 670 kW.</p>
<p>Under the proposal:</p>
<ul>
 <li>users would pay for 90% of contracted capacity;</li>
 <li>billing would not depend on actual consumption.</li>
</ul>
<p>For example, a 100 MW contract would be billed as 90 MW monthly.</p>
<p>Algorithm argues that this model is unsuitable for mining operations. The company has not yet received a response from the ministry.</p>
<h2 class="wp-block-heading" id="the-model-does-not-reflect-mining-consumption-patterns">The model does not reflect mining consumption patterns</h2>
<p>The proposal follows an initiative by Deputy Prime Minister Alexander Novak. The goal is to reduce strain on the power grid and control tariff growth.</p>
<p>Authorities view mining as a variable load. Therefore, they aim to ensure stable revenue for energy providers.</p>
<p>However, Algorithm argues that:</p>
<ul>
 <li>mining demand is flexible, not constant;</li>
 <li>actual consumption is lower than contracted capacity;</li>
 <li>electricity tariffs in Russia are rising faster than global benchmarks.</li>
</ul>
<p>The company also suggests that miners can act as “load-balancing consumers,” increasing usage during low-demand periods.</p>
<h2 class="wp-block-heading" id="miners-may-relocate-to-other-regions">Miners may relocate to other regions</h2>
<p>If implemented, the “take-or-pay” model could raise operating costs for miners. This would affect large-scale facilities the most.</p>
<p>Potential outcomes include:</p>
<ul>
 <li>higher production costs for Bitcoin mining;</li>
 <li>reduced profitability;</li>
 <li>relocation of mining operations to other regions.</li>
</ul>
<p>The policy may also slow new infrastructure development in Russia.</p>
<h2 class="wp-block-heading" id="regulation-of-the-sector-is-increasing">Regulation of the sector is increasing</h2>
<p>Algorithm предложила alternative regulatory measures:</p>
<ul>
 <li>classify miners as balancing consumers;</li>
 <li>allow direct connection to power generation;</li>
 <li>replace mechanical shutdown systems with software controls.</li>
</ul>
<p>The company argues that regulation must reflect the specifics of mining.</p>
<p>The situation highlights a broader trend. Governments are tightening control over energy-intensive industries.</p>
<p>At the same time, mining is becoming part of national energy strategy. Future growth will depend on balancing regulation and infrastructure development.</p>
<p>Read also: <a href="https://ultramining.com/news/en/russia-may-introduce-take-or-pay-rule-for-mining/" rel="noopener noreferrer nofollow">Russia may introduce “take-or-pay” rule for mining</a></p>

Russian miners oppose “take-or-pay” energy model

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