No to cryptocurrency mining and a separate statutory licensing regime: a wise decision by the Standing Committee on Energy and the Environment

The Standing Committee on Energy and the Environment of the Norwegian Parliament has considered a private member’s bill from the Socialist Left Party (SV) proposing the introduction of a separate statutory licensing regime for data centers and a ban on cryptocurrency mining. The proposal to prohibit cryptocurrency mining received broad support in the Committee, while the proposal to establish a dedicated statutory licensing regime for data centers did not obtain a majority.

– It is appropriate that Parliament does not proceed with a new and separate statutory licensing regime at this time. The industry is already subject to a comprehensive regulatory framework through the Planning and Building Act, the Energy Act, the Electronic Communications Act, the Security Act, project maturity requirements, and other applicable laws and regulations, says Reynir Johannesson, CEO of Norwegian Data Center Industry (NDI).

Norwegian Datacenter Industry (NDI) represents Norway’s data center sector, which constitutes a key part of the country’s digital infrastructure. Our 135 member companies include data center operators in Norway as well as more than 100 supplier companies. Together, they deliver services and infrastructure that support critical societal functions within electronic communications, finance, healthcare, emergency preparedness and defence, in addition to enabling the development and use of artificial intelligence.

– The primary challenge is to apply existing regulatory instruments more precisely in order to maximise societal benefit, rather than introducing parallel statutory licensing regimes that would increase complexity and extend administrative processing times, Johannesson says.

Government process concerning cryptocurrency mining

– Cryptocurrency mining differs materially from data centers that provide services to businesses and the public sector. A prohibition is a targeted measure that may contribute to ensuring that electricity and grid capacity are prioritised for activities with higher societal value, says Johannesson.

He adds:

– The Government has already announced that it is assessing a temporary prohibition of this type of crypto-related activity, citing high energy consumption and lower societal benefit compared to other forms of activity.

NDI supports the overall direction of the Committee majority’s recommendation, which emphasises that the establishment of data centers must be assessed based on their effects on employment, value creation, preparedness, security and other societal considerations. At the same time, new projects must be evaluated in light of their impact on the power system, Johannesson underlines.

Societal benefit must guide future industrial policy

– It is essential that policymakers emphasise societal benefit when shaping future industrial and business policy. For the data center industry to maintain long-term legitimacy, it must be transparent what values are created both locally and nationally, and how projects contribute to Norway’s digital infrastructure and security, Johannesson concludes.

For further information

Reynir Johannesson
CEO, Norwegian Data Center Industry
Mobile: +47 465 48 595
Email: reynir@datasenterindustrien.no