Ethiopia has stopped issuing new permits for electric power supply to data mining companies, effectively halting the expansion of cryptocurrency mining in the country.

The decision comes as the state-owned Ethiopian Electric Power (EEP) says it has reached its limit in meeting new demand.

Key quote

EEP CEO Ashebir Balcha announced:

“From our current assessment, access appears to be at capacity.”

Quick facts

  • The freeze follows a surge in interest from mining companies. Twenty-five firms already operate Bitcoin mining facilities in Ethiopia, attracted by low-cost tariffs and abundant hydropower. Nearly 20 more are on a waiting list.
  • EEP began selling power to crypto-miners in foreign currency to generate additional revenue, marketing it as a way to monetize “stranded power” — surplus electricity generated during off-peak hours.
  • In the past fiscal year, EEP exported nearly 7% of Ethiopia’s generated power, earning $338 million in foreign currency. Crypto-mining companies were among the largest contributors.
  • Power exports to Kenya and Djibouti are also growing, with Kenya requesting an additional 100 megawatts on top of the 200 megawatts it currently receives.

Key background

  • Ethiopia generated $55 million from Bitcoin mining over a 10-month period in 2024, primarily through agreements with 25 mining companies.
  • These firms rely on the country’s low-cost hydroelectric power, much of it from the Grand Ethiopian Renaissance Dam (GERD). The dam’s surplus output exceeds local industrial demand, and Bitcoin mining has provided a market for this excess.
  • However, the practice has drawn criticism for its high energy use and potential to strain local supply.

Why it matters

  • The suspension highlights the tension between Ethiopia’s efforts to monetize excess power and the limits of its current infrastructure.
  • EEP currently operates 20 power stations with a combined capacity exceeding 7,900 megawatts.
  • The Grand Ethiopian Renaissance Dam, scheduled for full commissioning within two months, will add more than 5,000 megawatts to the national grid.
  • Despite that, only half of Ethiopia’s population currently has access to electricity, despite national grid coverage spanning over 20,000 kilometers.