Assessing the Economic Feasibility of Merging Small-Scale CHP Power Plants with Cryptocurrency Mining Farms: Effects on Energy Supply Security and Passive Defense of Iran

Due to the lack of investment to enhance the electricity production capacity, Iran is facing electricity shortages and power cuts. Energy conversion agreements have been one of the solutions proposed by the government to attract investors to this industry. Ministry of Energy’s lack of financial resources, in addition to lower energy demand during off-peak seasons, has led to a reluctance towards increasing the attractiveness of energy conversion agreements for investors. On the other hand, the expansion of the cryptocurrency mining industry has increased the burden on the power grid, especially during the warmer seasons.
Drawing on financial modeling and Comfar software, this article demonstrates the attractiveness of combining decentralized power plants and cryptocurrency mining farms as an investment opportunity. Furthermore, the paper proposes limiting energy conversion contracts to four months of the year - when there exists a higher demand for electricity. Removing the requirement from power plants to supply solely to the government, by allowing them to supply the electricity they generate directly to cryptocurrency mining fields (or other customers), will decrease the burden on the financial resources of government, and furthermore, could lead to generating income by selling natural gas during the off-peak seasons. Furthermore, the government can increase the guaranteed basic price of agreements by drawing on the resulting financial resources, thus increasing the attractiveness of investment in the electricity production industry.