New York Seeks to Tax Bitcoin Miners Heavily Amid Rising Power Costs

In a move that’s drawing sharp debate, Democratic lawmakers in New York have introduced a bill targeting Bitcoin miners with a tiered excise tax based on electricity usage. Under the proposal, miners consuming 2.25 to 5 million kilowatt-hours would pay 2 cents per kWh, while those using 20 million or more could face a rate of 5 cents per kWh. Supporters argue that crypto mining operations contribute to rising utility costs for ordinary households and small businesses, and that the tax would help redistribute costs more fairly.

Proponents also built in a carve-out: operations using sustainable or renewable energy could be exempt from the tax, signaling a desire to encourage greener mining practices. The lawmakers behind the bill say it balances enforcement with incentives, targeting high consumption while promoting innovation in energy efficiency and clean tech. The funds raised are intended to support New York’s energy assistance programs—helping low to moderate income residents who struggle with high electricity bills.

But critics warn of unintended consequences. Heavy taxation could push miners to relocate to more favorable jurisdictions, reducing local jobs and energy demand. There’s also complexity: verifying power usage, accounting for off-grid or co-generation setups, and establishing fair enforcement will be challenging. Further, many in the crypto sector argue that the energy concerns are overstated and that bitcoin mining contributes to grid stability by absorbing surplus power. Whether the bill becomes law—and if so, how it’s implemented—will test how states balance energy equity, climate goals, and the evolving pressures of the crypto industry.