Laos faces power shortages due to crypto mining and erratic rainfall

Somboun Sangxayarath, an adviser to state-owned Electricity of Laos (EDL), said increased electricity demand in Laos due to cryptocurrency mining and erratic rainfall has led to power shortages, suggesting challenges to the country's prospects as a hydropower exporter in Southeast Asia. Laos, known as the "battery" of Southeast Asia for its hydropower export potential, provides the cheapest and most stable clean energy, which is crucial to decarbonizing the region as it works to scale up solar and wind power. A policy push to build data centers in 2021 has led to a boom in cryptocurrency mining, which now accounts for more than a third of Laos' electricity demand, while reduced rainfall has curbed hydropower output, leading to blackouts, Sangxayarath said. Hydropower has accounted for 80% of Laos' electricity generation over the past decade, most of which is sold by independent power producers through cross-border deals with Thailand and Vietnam. In the domestic market, where EDL is a power supplier, it has become a net importer since 2021, requiring up to 600 megawatts (MW) of additional capacity during peak demand hours, more than doubling the company's costs, Sangxayarath added. Laos said last year it would not supply electricity to cryptocurrency projects that had not yet begun operations. Sangxayarath said that while the order remains in effect, it is still actively considering new investment proposals and seeking to increase electricity supply. [Reuters]