The economic implications are staggering – and the opportunity still exists. From Moneyweb.
If you had mentioned bitcoin mining to a power utility five years ago, you would have been laughed out of the boardroom. There’s not much to laugh about now.
Carel de Jager, CEO of Silver Sixpence and a former Eskom engineer, ran some simulations to quantify what impact bitcoin mining would’ve had on Eskom’s balance sheet. The figures are staggering.
Starting on 1 April 2020 and running three million bitcoin mining machines until the end of December 2024, Eskom would have cranked out more than 406 000 bitcoin (BTC) – sufficient to pay off a new 2 000MW power plant costing $1.7 billion in 279 days, and leave it debt-free.
This is somewhat less than the 506 137 BTC owned by MicroStrategy, or the 574 083 owned by BlackRock’s newly formed exchange-traded fund, but would still make Eskom one of the largest single producers and owners of BTC in the world.
Not that Eskom would have to build a new power plant to go into bitcoin mining. Speaking at the Adopting Bitcoin Conference earlier this year, De Jager assumes bitcoin mining would only take place on surplus power produced from Eskom’s 15 coal-fired plants, avoiding load shedding and periods when gas turbines are required to stabilise the grid – and then only 72% of the time.
Assuming half the bitcoin mined was sold in real time and half was placed in reserve, Eskom would have been able to pay off its current debt of about R422 billion.
This would also have reduced, then eliminated, its interest bill, which ran to R33 billion in 2023.
The total revenue from selling BTC in real time comes to $12.2 billion (R224 billion), bearing in mind these would be sold at bitcoin prices ranging from $6 415 (April 2020) to around $93 460 (31 December 2024).
That would have freed up capital for maintenance and new power plant construction.
More importantly, it would likely propel SA’s economic growth into double-digit figures, says De Jager.
This is not fanciful speculation. Logistics consultancy The Gain Group estimated in 2023 that rail and port failures cost South Africa R1 billion a day in economic output, equating to R353 billion annually or 4.9% of GDP.
In 2023, the Council for Scientific and Industrial Research (CSIR) estimated that load shedding has resulted in economic losses of R2.9 trillion since 2007, with 2023 losses alone coming in at R481 billion – equivalent to nearly 7% of GDP.
Listen/read: Crypto heists, blockchain sleuths, and turning surplus power into bitcoin [Mar 2025]
Fixing the Eskom balance sheet would have given it the firepower to address critical maintenance backlogs and juice up the economy.
Why it would work, and is working elsewhere
Bitcoin mining is particularly suited to power utilities with surplus power during off-peak times.
Coal-fired turbines cannot be turned off when demand decreases, but they can be throttled to about 50% of capacity so that supply is always matched to demand.
When supply is too low, we end up with load shedding, when it is too high, energy generation is scaled back.
Eskom maintains an emergency reserve capacity of about 2 000MW, even during load shedding, in case a turbine fails.
“The wonderful thing is that this bitcoin network pays you in real time. Having bitcoin miners as clients is much more reliable than having municipalities as clients, which owe Eskom close to R110 billion,” says De Jager.
“Bitcoin is the perfect client if you are a power utility. It takes surplus power from the grid when you have it, and you can shut it down in a millisecond when you need that power elsewhere,” he adds.
“That helps stabilise the grid and means you can earn extra revenue during off-peak periods so long as the bitcoin miners are producing. There are no long-term supply contracts and no penalties – as is the case with many energy-intensive mining companies and industrial plants – when you suddenly shut off power.”
Eskom would not be the only power utility in the world to enter bitcoin mining:
- Canada’s state-owned utility Hydro-Québec, which produces about 46 000MW of mostly hydro-electric power, has attracted several bitcoin miners by offering cheap, renewable energy at rates as low as $0.03/kWh;
- Greenidge Generation in Texas powers a bitcoin mining operation with 120MW capacity. Bitcoin miner Riot Platforms has teamed up with another Texas power utility, Ercot, by consuming surplus power during off-peak hours, and shuts down its miners when peak household demand kicks in – this also provides grid stability to Ercot; and
- Russia’s top bitcoin miner Bitriver uses power generated from otherwise wasted flare gas from power utility Gazprom Neft.
Ethiopia signs MoU
Closer to home, Ethiopia last year signed a memorandum of understanding with Hong Kong-based West Data Group’s Center Service plc to commence mining bitcoin using hydroelectric power.
This could grow the Ethiopian economy by $2-4 billion.
“The best time for Eskom to have started mining was 2020, but the second-best time is now,” says De Jager.
