Ethiopia has reportedly reduced electricity delivered to Bitcoin miners to 23% of contracted levels as lower water inflows strain the country’s hydroelectric reservoirs.
On Tuesday, Bloomberg reported that El Niño intensified dry conditions in the east African country, reducing water inflows into its reservoirs by 20%. Ethiopian Electric Power (EEP) CEO Ashebir Balcha said the company cut power to miners to prioritize households and manufacturers.
Balcha said EEP initially reduced deliveries to 75% of contracted levels, easing to 50% and then 23%. The company will reassess conditions in October and could impose further reductions or even restrict electricity exports to neighboring countries, according to the report.
Bitcoin miners reportedly accounted for 35% of EEP’s revenue last fiscal year and consume almost one-third of Ethiopia’s electricity output. The country’s inexpensive hydropower has attracted international miners, including Phoenix Group, which expanded its Ethiopian mining capacity to 132 megawatts in April 2025.
Bitcoin mining power growth faces pressure from halvings and AI
Separately, economist and The Bitcoin Standard author Saifedean Ammous said in a Tuesday X post that global Bitcoin mining electricity consumption and capital expenditure may have peaked in 2024 to 2025.
Ammous said Bitcoin’s price would need to rise more than 18.92% a year just to keep the dollar value of newly mined coins growing, even before accounting for dollar depreciation. Under Bitcoin’s halving mechanism, the amount of Bitcoin awarded to miners is cut in half about every four years.
The price of the biggest crypto by market cap is down by more than 35% over the last 12 months, Yahoo Finance data shows.
“Given this decline in mining rewards, it would be expected that bitcoin mining would slow down, or even contract,” Ammous said. “Unless there is a major turnaround in this metric, this trend may continue indefinitely.”
Related: Bitcoin miner Phoenix Group adds 52 MW of mining capacity in Ethiopia
He also cited competition from artificial intelligence data centers, which gives miners an alternative way to monetize their electricity connections and infrastructure. Citing VanEck data, Miner Weekly estimated in June that public miners could require around $50 billion to develop their planned AI infrastructure as weaker mining economics encourage companies to redirect capacity.
Ammous said his conclusion as a testable hypothesis, acknowledging that substantially higher transaction fees or a sustained recovery above Bitcoin mining’s previous electricity-consumption peak could invalidate it.
Magazine: AI may already use more power than Bitcoin — and it threatens Bitcoin mining
