Texas starts requiring new large-scale cryptocurrency miners to seek permission to access its power grid, in anticipation of increasing demand for 2022 and 2023
Context & Ripple Effects
Texas spent late 2021 courting the industry it is now gating: after China's crackdown pushed miners abroad, the state rolled out incentives, cheap power, and light-touch regulation to recruit them despite running the most vulnerable grid in the US. This permission requirement is the first sign the welcome mat is being pulled back in anticipation of 2022-2023 demand.
First-order effects
- New large-scale mining operations can no longer simply plug into ERCOT — they must clear a permission process first, adding time and uncertainty to site launches while already-connected miners are grandfathered in.
Second-order effects
- Miners shopping for jurisdictions after leaving China now face a trade-off between Texas's power market and its new gatekeeping, pushing some toward states still offering unrestricted access; meanwhile the incentive-driven boom gives state officials a live case study of what unmanaged load growth does when energy prices spike.
Third-order effects
- If the pattern holds, large compute loads get treated as utility-siting decisions rather than ordinary customers — a template that extends beyond crypto as AI data centers pile onto the same overtaxed grids, and as rising local electricity costs around 34 US bitcoin mines harden public opposition to socializing grid expenses.
The trend: Jurisdictions that recruited energy-hungry computing with cheap power are pivoting from open-door recruitment to gatekeeping as those loads collide with grid limits.