New York is tightening its stance on crypto mining. State Senator Liz Krueger has introduced new legislation that would impose a tiered tax on energy used by mining companies. The goal is to reflect the enormous electricity consumption associated with mining – especially Bitcoin.

Energy-based tax: the more you use, the higher you pay

The proposed energy excise tax would depend on the annual electricity usage of miners:

• Up to 2.25 million kWh per year: no tax

• 2.26–5 million kWh: $0.02 per kWh

• 5–10 million kWh: $0.03 per kWh

• 10–20 million kWh: $0.04 per kWh

• Over 20 million kWh: $0.05 per kWh

Companies using 100% renewable energy would be exempt. These firms were also allowed to continue operating during New York’s two-year moratorium on crypto mining (2022–2024), while fossil-fuel-based mining was heavily restricted.

New tax could decide who survives

Crypto mining is a highly competitive business where even small cost differences matter. Electricity prices are a key factor for survival. A few extra cents per kilowatt-hour can make smaller companies unprofitable.

Large players with access to renewable energy sources have an advantage—they can build their own infrastructure and avoid volatile grid prices. Smaller firms reliant on retail rates, however, may be forced out of the market.

Bitcoin mining costs are surging

According to TheMinerMag, the average cost of mining one Bitcoin exceeded $70,000 in Q2 2025—a historic high. The main reasons are increased mining difficulty and higher computational power across the Bitcoin network.

New York could lose miners

If the bill passes, some mining companies may leave New York. Regions with lower energy costs and no additional taxation could become more attractive. For New York, this might mean a loss of investment and jobs—but for environmental policy, it represents another tool to regulate an energy-intensive sector.

Sources:

https://www.nysenate.gov/legislation/bills/2025/S8518

https://www.nysenate.gov/legislation/bills/2021/S6486

https://theminermag.com/research/2025-06-16/bitcoin-mining-research-june

https://cointelegraph.com/news/new-york-senator-introduces-crypto-mining-tax