Curtailment occurs most frequently in summer months when customers turn on their Air Conditioners which causes a sudden increase in electricity demand on the grid. If the grid cannot supply or produce enough electricity to meet this demand, the grid may experience power outages known as brown outs.
Alternatively, the grid can reduce demand elsewhere by incentivizing businesses to reduce power consumption during these high demand periods. This is curtailment - Simply put, Curtailment involves temporarily reducing and/or shutting down electricity use to balance supply and demand to ensure the stability of a local power grid. Curtailment is an essential strategy used primarily during the summer months when the demand for electricity spikes because of higher temperatures.
Due to the industry's large flexible power load, Bitcoin miners are prime candidates for curtailment programs. By opting into these curtailment programs and reducing power demand in times of need, miners can secure cheaper electricity rates for their operations. In regions where essential services like hospitals and military bases rely on uninterrupted power for critical operations, such as running life support machines, participation in curtailment programs is vital.
Understanding and adapting to curtailment practices is paramount to maintain operational stability and manage costs in energy-intensive industries like Bitcoin mining.
For the industry, curtailment is all about balancing the need to continue operations with the broader requirement of keeping the power grid stable and functional for all users.
At Compass, we participate in curtailment programs to ensure our customers receive competitive hosting rates. As Bitcoin Miners, we support curtailment programs to do our part to strengthen local grids when they need it most.
What is Curtailment?
Curtailment occurs most frequently in summer months when customers turn on their Air Conditioners which causes a sudden increase in electricity demand on the grid.