Ethiopia’s Crypto Mining Boom Strains Power Grid
Ethiopia’s growing cryptocurrency mining industry might be bringing in foreign investment, but it’s also putting serious pressure on the country’s already stretched electricity supply. According to a recent government report, crypto-related data centers could use up nearly a third of Ethiopia’s total power by next year—raising tough questions about who gets access to energy, and who doesn’t.
The numbers are hard to ignore. The *Ethiopian Energy Outlook 2025* predicts these facilities will consume over eight terawatt-hours in 2025. That’s roughly 30% of national demand. For a country where half the population still lacks reliable electricity, that’s a big deal. The report, put together by state energy agencies, doesn’t outright condemn crypto mining, but it does hint at unease. Is this really the best use of limited power?
Electrification Lags Behind Crypto Growth
On paper, Ethiopia’s made progress. About 2.2 million homes were connected to the grid in the past five years under the National Electrification Program. But here’s the catch: only 22% of the population has legal, metered electricity. Nearly 50% still rely on patchy or nonexistent power. In rural areas like Afar and Somali, electrification rates sit below 12%, while Addis Ababa enjoys 93% coverage.
The report points out that slow grid expansion is holding back economic growth. Diesel generators remain common for farmers pumping water, and clinics often go without steady power. Meanwhile, crypto miners—many benefiting from subsidized electricity rates—are soaking up energy that could otherwise go toward households or agriculture.
Trade-Offs and Tough Choices
Critics aren’t saying crypto mining has no value. It brings in foreign currency and taps into Ethiopia’s mostly renewable energy mix (about 98% hydropower). But timing matters. With 15 million households still waiting for grid connections, some argue the government’s priorities might be skewed.
There’s also the question of pricing. A proposed tariff hike—potentially up to 400% by 2028—could make mining less profitable. Right now, miners pay below-market rates, but that might not last. The report suggests “cost-reflective” pricing could free up funds for grid expansion, especially since 68% of Ethiopians live within five kilometers of existing infrastructure.
The irony? Ethiopia only warmed up to Bitcoin mining *after* its central bank banned crypto trading in 2022. Mining firms were quietly registered through the cybersecurity agency INSA, signaling a push to monetize digital assets.
But for critics, the math is simple: when clinics and farms lack power, maybe energy policy needs a rethink. Not everyone’s convinced crypto’s benefits outweigh the costs—at least, not yet.
