By ANDY GARDNER

MASSENA -- Massena Electric Department are studying their system to see if it's possible to accomodate cryptocurrency mining operations, given that they require large amounts of power.

MED board chairman James Shaw told the Town Council on Wednesday that they are in a learning process as more cryptocurrency miners approach them about setting up in the village.

Cryptocurrency mining involves using powerful computers running online 24 hours a day, seven days a week, to solve math problems that encrypt and unlock cryptocurrency on what's known as a blockchain. The unlocked and encrypted portions of the blockchain are then sold or traded as a commodity.

“We’ve been in a learning process. As we’ve been hearing from people, we’ve been concerned can the system meet these needs? And what happens to the rates if they come on board," he said.

Shaw said the operations would require so much power that it would drive up rates for everyone else. He said they are given an allotment through the New York Power Authority, and anything else must be bought on the market from the New York Municipal Power Agency, a statewide joint agency that sells power to municipalities.

“If we have somebody come in as large of a user as some of these (cryptocurrency mining operations) would be, we would have to buy a lot of power on the market," Shaw said. “Everybody’s rate would go up. We don’t want everybody’s rates to go up."

He said the Public Service Commission recently passed a tariff that allows agencies like MED to charge higher rates for groups like cryptocurrency miners, if they get an extra allotment from the power authority beforehand.

“If a person comes into the system and gets an allotment from NYPA, we can pass the rate directly to them without affecting anyone … [it] requires an allocation from the power authority," Shaw said. “We’re fortunate the Public Service Commission recognized the urgency of this matter and passed it on an emergency basis. They forgoed public comment periods, they forgoed publishing it in the newspapers."

He said they are monitoring their system for anything that looks like someone may be running a cryptocurrency mine.

“We do have computer programs that watch load in our customer’s base. If suddenly the power goes up or goes down, it’ll flag it … we’re watching and where we suspect things might be happening, we’re watching even closer," Shaw said.

The City of Plattsburgh recently passed an 18-month moratorium on cryptocurrency mining inside the city limits.

"But it can be lifted at any time if the city gets a handle on how much electricity cryptocurrency operations can use and how to alleviate burdens on other ratepayers," the Plattsburgh Press Republican reported on March 16 in a story at https://bit.ly/2ubFpB7.