Illegally built power stations, tampered power meters and underground mining farms helped “black” miners steal almost $6.6 million (450 million Russian rubles) from local energy providers over the past three years, state-owned power grid company Rosseti said.
The company initially reported the figure in its official Telegram channel (in Russian) and later confirmed the number to CoinDesk. According to Rosseti, it has been looking for mining farms that don’t have any contracts with local power generating firms, but still plug into the electric grids and use generated electricity without paying for it.
It would usually happen on the premises of an already existing business, like a factory, where the owners want to earn “additional income,” a Rossetti spokesperson told CoinDesk. Other mining farm locations included garages, rented offices, a house in the woods and a former actual farm (for producing food, not bitcoin), where the ASICs were placed.
To steal electricity, the owners would pull an electric cord right to the nearest power line and build their own power transforming stations. In one such case, the owner hid the station literally underground, burying it in the soil in a public forest, according to Rosseti.
People would also tamper with the power meters to make it look like they consume less energy than a mining farm would need – which, in the case of the bitcoin mining, would be more than a kilowatt per hour for a single mining machine, multiplied by thousands of machines per farm.
Since 2017, Rossetti found 35 cases of illegal power consumption in 20 regions of Russia (Russia consists of 85 regions of various size and population density). Each of these cases has been reported to law enforcement officials, Rossetti said.
“We closely analyze the consumption patterns looking for anomalies, inspect the power lines and measure the workload of the stations. Sometimes it’s easy to notice a mining farm by visual signs, like when a building has powerful air conditioning devices and fans installed,” the company said.
Over the last year, people have been illegally mining crypto using computers in a nuclear research institute and through the website of a local utility provider. Rosseti, in turn, has been exploring the other side of the technology, looking for ways to use the distributed ledger to gather the power consumption data more effectively.
The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.