Exclusive: Inner Mongolia suddenly suspended 21 mining farms from participating in multilateral electricity trading, and electricity charges may increase by 1/3

Wu Blockchain exclusively learned that on the 24th, the Inner Mongolia Industry and Information Technology Department issued a "Notice on Mining Enterprises' Participation in the Inner Mongolia Electricity Multilateral Trading Market" to the Inner Mongolia Electric Power (Group) Co., Ltd.

The notice stated that at the end of 2019, an on-site inspection was carried out on 30 big data and cloud computing companies in seven leagues and cities, and 21 mining companies were found. They were required to suspend their qualifications to participate in the listing and trading of characteristic industries, and the companies that no longer engaged in mining would be restored after verification.

The notice stated that in accordance with the requirements of the state and the autonomous region to guide enterprises to withdraw from the "mining" business, in order to effectively support the sustainable and healthy development of the cloud computing and big data industries in our region and further standardize electricity market transactions, please make the list of enterprises public.

The 21 companies include most of the large mining farms known to the industry, and the rest are mainly normal IDC companies. However, some mining companies are not on the list. The requirements of this notice are relatively detailed, and industry insiders are worried that it will not be hastily implemented, unlike in the past.

In 2006, the Inner Mongolia Power Trading Center was established. In May 2010, the Inner Mongolia Power Multilateral Trading Market was officially launched, becoming the first officially operated provincial power market in my country. As of October 2019, the number of members of the power market has reached 1,820, and the cumulative reduction of corporate electricity costs is 30.01 billion yuan. The multilateral trading market allows the relevant power generation, power supply and power users to determine electricity prices in a more flexible way, which is different from the national unified pricing.

For mining farms, the electricity fee is 0.2-0.3 yuan per kWh after participating in multilateral transactions (the mainstream is 0.26 yuan). If they cannot participate in multilateral transactions, some people speculate that the normal electricity fee is 0.3847 yuan, and some speculate that the large industrial electricity fee is 0.47 yuan. This means that the electricity fee of mining farms in Inner Mongolia may increase by 1/3.

In July, Inner Mongolia concluded a two-and-a-half-month on-site inspection by a coal-related corruption inspection team. Inner Mongolia Electric Power (Group) Co., Ltd. was also a company subject to regular inspections. The inspection team concluded that “the relevant departments were urged to recover 6.732 billion yuan in taxes and fees and 4.836 billion yuan in mining rights income.”

At present, we have no idea why the verification information at the end of 2019 suddenly occurred on August 24, nor can we judge whether this is a short-term behavior or will continue to be strictly enforced. Since the mining industry is in a policy gray area, changes in wind direction occur from time to time.

On November 11 last year, the Department of Industry and Information Technology of the Inner Mongolia Autonomous Region issued a "Notice on the Joint Inspection of Virtual Currency "Mining" Enterprises", requiring the inspection to focus on virtual currency "mining" enterprises that have nothing to do with the real economy, evade supervision, consume a lot of energy, and use "big data industry" as a package to enjoy local electricity prices, land and taxation preferential policies. The list of companies published this time is suspected to be the result of this round of inspections in November last year.

The inspection in November last year was a follow-up to the "Notice on the Inspection, Cleanup and Rectification of Virtual Currency "Mining" Enterprises" issued on August 30, 2018. The notice emphasized the implementation of the "National Financial Work Conference and the National Internet Financial Risk Special Rectification Working Group Symposium and the relevant instructions of the autonomous region leaders", requiring the cleanup and orderly exit of virtual currency "mining" enterprises in the region.

There are some policy changes for the mining industry this year. Sichuan is advocating the use of mining demonstration areas, but at the same time, it and Yunnan are cracking down on traditional direct power supply. Inner Mongolia's crackdown has caused concerns about the upcoming dry season, especially whether Xinjiang will be affected and follow suit in policy. At present, the power load of mining farms in Inner Mongolia is lower than that in Sichuan, Xinjiang and other places.

At the central policy level, on January 2, 2018, the Leading Group of the Internet Financial Risk Special Rectification Office issued an internal document requiring local governments to guide enterprises under their jurisdiction to orderly withdraw from the "mining" business and regularly report on their work progress. The document pointed out that the mining industry wastes resources and encourages virtual currency speculation. The draft of the 2019 National Development and Reform Commission's industrial structure adjustment guidance catalogue for soliciting opinions once listed cryptocurrency mining as an eliminated industry, but the main text was deleted on November 6. The Energy Bureau is under the jurisdiction of the National Development and Reform Commission, and it is reported that insiders have studied the use of mining to absorb abandoned water and electricity.

On April 29 this year, the Office of the Sichuan Provincial Financial Work Leading Group issued the "Notice on Guiding Enterprises to Orderly Withdraw from Virtual Currency "Mining" Activities", emphasizing that the policy orientations of various ministries and commissions on virtual currency "mining" activities are highly consistent, and the work requirements for guiding withdrawal have not changed.

But in general, there are some trends in the compliance of the cryptocurrency industry. Sun Guofeng, director of the Monetary Policy Department of the People's Bank of China, revealed that the issue of regulating ICO regulations was discussed in the last revision of the Securities Law. The Supreme People's Court and the National Development and Reform Commission also reiterated that "the operating value of corporate assets should be maintained to the greatest extent possible. Strengthen the protection of new rights and interests such as digital currency, network virtual property, and data." Industry insiders generally expect that the crypto mining industry will also be able to make progress in compliance.