Bitcoin Mining Boosts Zambian Hydroelectric Plant, Transforms Local Economy

March 26, 2025
Bitcoin Mining Boosts Zambian Hydroelectric Plant, Transforms Local Economy
  • Local residents, such as barber Damian, have experienced significant lifestyle changes due to the introduction of electricity, enabling them to enhance their businesses and improve communication.

  • A bitcoin mining operation in northwestern Zambia is powered by the Zengamina hydroelectric plant, which was built in the early 2000s with $3 million in charity donations.

  • This partnership with Gridless has transformed the plant's revenue, with the bitcoin mine now accounting for about 30% of its income, allowing for lower electricity prices for the local community of around 15,000 residents.

  • Despite the benefits, the hydro plant has faced challenges with unused electricity due to a lack of demand, which was addressed by Gridless's introduction of a mobile bitcoin mining unit.

  • Looking ahead, Gridless plans to expand by building its own hydro plants to continue mining bitcoin and providing electricity to more rural areas, tapping into Africa's abundant hydro potential.

  • The success of this model has sparked interest in other regions, with projects in the Democratic Republic of Congo and Ethiopia exploring similar strategies to monetize excess energy.

  • However, as the Zengamina plant prepares to connect to the national grid, the economic viability of the electricity for Gridless may diminish, prompting the company to seek new sites with stranded energy.

  • Past incidents of bitcoin mining causing strain on public energy grids in other countries highlight the need for clear agreements to balance energy demands with mining activities.

  • This model of integrating bitcoin mining into energy projects is seen as a potential solution for the over 65% of small-scale energy systems in sub-Saharan Africa that are commercially unviable without external support.

  • While the approach holds promise, concerns exist regarding potential competition for electricity between local users and miners, especially during periods of high Bitcoin prices.

  • Despite facing criticism for its energy consumption, Gridless emphasizes its commitment to balancing local community needs with profitability.

  • Gridless envisions itself as a temporary player in the region, planning to withdraw once local energy demand increases and the hydro plant connects to Zambia’s national grid.

Summary based on 4 sources


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