Australian Bitcoin Company Looks Towards Northern Norwegian Energy

Hydrokraft AS i Glomfjord
Hydrokraft AS is established in Meløy municipality in Northern Norway and started operations in 2021. The company and its associated subsidiaries have been bought by Australian Arkon Energy. 

Arkon Energy has bought the cryptocurrency mining company Hydrokraft in Glomfjord, Northern Norway. The facility will use large amounts of energy to produce bitcoin. It is important to discuss how we use this energy in the future, the mayor states.

Discussing how Northern Norwegian energy will be used in the future is important, especially in connection with jobs and ripple effects, says Meløy Mayor Sigurd Stormo (Labor) to High North News.

Stormø is the mayor of the municipality where the cryptocurrency facility and company Hydrokraft AS is located. The Glomfjord-based company has recently been acquired by the Australian data center infrastructure company Arkon Energy, which bases its mining of bitcoin on renewable energy. Avisa Nordland was the first to write about the acquisition. 

In a press release, the Australian company highlights how Hydrokraft runs its cryptocurrency mining facility based on low-cost hydroelectric power.

Power questions

What are your thoughts on using hydropower for this type of industry, such as bitcoin mining?

"When we have excess and spare power, using it is not necessarily unreasonable. However, we must discuss which type of industries are granted access to energy, with utility and future jobs in mind. I believe that we need government guidelines to regulate this type of industry. Also considering data storage which, unlike bitcoin, can be considered as a useful product that we all depend on in a digitalized society," writes Mayor Stormo in an e-mail.

Mining the digital currency bitcoin requires as known large amounts of energy. The cryptocurrency is mined with the help of computer software which uses computing powers around the clock to solve tasks.

Power and access to power will be decisive factors in the green shift. Therefore, it is important to discuss how we use this power in the future, especially with regard to jobs and ripple effects. I am initially skeptical of this type of industry. However, if Hydrokraft switches its operations to data storage, I believe that would change," he points out.

Stormo adds that data center storage will be important to have in Norway in the future, especially from a security and vulnerability perspective.

Ripple effects

"In essence, we welcome anyone who wants to operate or invest in commercial activity in the municipality," says the Meløy mayor.

"The establishment of industry generally creates positive ripple effects through investments in infrastructure, jobs, and work for service industries. As far as my knowledge of this type of industry [bitcoin mining, journ.note] extends, it provides fewer ripple effects and jobs than battery or solar cell production, for example," he specifies.

Hydrokraft has pointed to the fact that there is limited power in Glomfjord. What is Meløy municipality's strategy in regard to securing enough power for the industry in the region?

"We are working with Glomfjord Industripark to ensure more power access, but in regard to solar cell production, hydrogen and ammonia production.

A very good opportunity to take advantage of our unique profitability and access to growth capital.
CEO and co-founder Josh Payne

Australian bitcoin company

Arkon Energy was established in 2019. Josh Payne is the CEO and co-founder of the company.

Ahead of this company's acquisition of Hydrokraft in Glomfjord, it completed a round of financing of 28 million dollars.

"The current market climate, with low prices for bitcoin and mining equipment, offers a compelling opportunity to take advantage of our unique profitability and access to growth capital. We are excited to have completed this transaction and we look forward to executing on several additional growth opportunities in the near future," says Payne.

According to a press release, the company plans to immediately begin work to build out incremental infrastructure to utilize the facility’s full capacity.

Hydrokraft AS has a current operating capacity of 30 MW, with a maximum power capacity of 60 MW.

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This article was originally published in Norwegian and has been translated by Birgitte Annie Molid Martinussen.