Ephrata OKs yearlong ban on new cryptocurrency mining

EPHRATA — Ephrata joined the ranks of Grant County cities temporarily banning cryptocurrency development after the city council voted Wednesday to block new cryptocurrency operations for the next 12 months.

“A moratorium means taking a break,” said council member Kathleen Allstot. “This is a one year break... We wait to see what’s going, make sure this fits in Ephrata and the Grant County (Public Utility District) has figured out how to get power to it.”

The vote for the moratorium was 6-1, with council member Matt Moore voting against. Mayor Bruce Reim did not attend Wednesday’s council meeting.

“The noise was like an ocean,” Donna Huesties, whose Nob Hill Drive home overlooks one of the city’s cryptocurrency operations, told the city council. “And I tried to pretend it was the ocean, but that gets old, 24/7, 24/7, 24/7.”

Huesties’ husband Gary said the couple was simply not able to enjoy their backyard in the summer once the cryptocurrency miners turned on all their industrial air conditioners.

However, Moore was concerned that banning, even temporarily, a single industry from the city was outside the city’s expertise. Especially since the factors that determine the viability of cryptocurrency operations are beyond the city’s control.

“Economics will be the deciding factor,” Moore said. “If this is an economical business, and this is one of the ideal places to situate it, I don’t want to surrender any economic opportunity big or small.”

The moratorium will only block new cryptocurrency operations from locating in Ephrata, and has no effect on the four currently located in the city.

Cryptocurrency operations, which use computing power to crunch complex algorithms and “mine” digital currency units that are authenticated by blockchains (which attests to the currency unit’s legitimacy as well as currency holders and transactions over time), are attracted to the Columbia Basin because of the region’s abundant and inexpensive electricity.

However, cryptocurrency miners are criticized for using large amounts of power without providing significant numbers of jobs. A number of Grant Cities have imposed temporary bans on new cryptocurrency developments, and the Grant County PUD has created a new — and significantly higher — electricity rate for cryptocurrency firms.

The new rate is set to come into effect in April, 2019.

However, council member Justin Kooy said that even when the new utility rates come into effect, Ephrata will still need regulations for cryptocurrency miners.

“Even with rising rates, they’re still better than the national average, and this is still an ideal location,” Kooy said.

City Attorney Anna Franz said the moratorium resolution includes a call for a revision of the city code to govern cryptocurrency operations.

Ephrata City Administrator Wes Crago said there are four crypto currency operations in Ephrata — two at the Port of Ephrata, one in a city-zoned industrial area, and one in a residential area that is currently being relocated.

Charles H. Featherstone can be reached via email at countygvt@columbiabasinherald.com.