North Bay bitcoin operation shut down over power bill dispute

North Bay bitcoin operation shut down over power bill dispute

North Bay bitcoin operation shut down over power bill dispute

Hut 8 did not respond if the facility is completely closed or inactive but maintained

Bitcoin mining operations at a North Bay data center are suspended due to a dispute between a cryptocurrency company and its energy supplier.

Hut 8 Mining reported that operations at the facility have been shut down this winter due to a disagreement Validus Power in their energy supply contract.

The dispute between the two companies has been brewing for a long time, according to a news release from Hut 8 since November.

Hut 8 and Validus signed a power purchase agreement (PPA) in 2021 to bring a hidden power plant to life on Highway 11, north of the city.

See: The Bitcoin ‘Power to Data’ project was inaugurated at the idle North Bay power station

Now Hut 8 accuses Validus of “breaching certain obligations” under the terms of that energy contract. Both companies have exchanged failure notices.

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Two months ago, Hut 8 reported that it was issuing a notice of default event to Validus, saying that Validus had “failed to achieve certain key operational milestones” under the terms of the power agreement.

These Bitcoin data centers consume large amounts of electricity to run and cool banks of high-powered computers. Over the past year, cryptocurrencies like Hut 8 have grumbled about fluctuating power prices that have cut off bitcoin production.

In Hut 8’s third-quarter results published in early November, the company said Validus had “demanded the company (Hut 8) make power delivery payments in excess of those negotiated under the terms of the PPA,” and blamed Validus. “Failure to fulfill its contractual obligations under the PPA.”

Hut 8 said Validus stopped supplying power to the North Bay facility and issued a default notice on its own, alleging that Hut 8 failed to make certain payments related to the supply of energy, a charge Hut 8 said it categorically denies.

Hut 8 said it is going the mediation route with Validus to reach a resolution.

Hut 8 did not respond if the facility is fully closed or remains in an idle but maintained state.

The company also did not say how many jobs are affected. through A opening ceremony in October 2021company officials said up to 30 senior technicians may be employed.

In a recent online interview with Compass Mining, Sue Ennis, Hut’s vice president of corporate development, said they plan to reach a settlement with Validus. “We hope for a positive outcome.”

But at the same time, Hut 8 has indicated that its backup plan is to secure an alternative electricity supplier, possibly through the merger and acquisition route.

In an emailed response, Jesse Nickel, Validus’ vice president of business development, said the two sides are “actively engaged and collectively seeking a resolution.”

“We are hopeful that we will reach a mutually successful outcome, either before or during mediation. Hut has a strong vision and deep industry experience and is an excellent partner for Validus Power. We are optimistic and anticipate a return to business as usual in due course.”

Meanwhile, Validus maintains large cryptomining plans of its own.

The company has two data centers under development in Kingston and Iroquois Falls, the latter of which involves the use of a 120 megawatt natural gas generating facility not far from the planned data center. Validus previously announced that it was Building a data center in Kapuskasingsupplied by a local power plant.

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