Vice Prime Minister cites grid strain from unregulated operations
Georgia will install electricity meters across Mestia villages to identify and shut down illegal cryptocurrency mining operations blamed for crippling the region’s power grid, Vice Prime Minister Mamuka Mdinaradze announced Monday.
Mestia consumed 133 million kilowatt-hours of electricity in 2025, roughly 13 times the average for comparable municipalities in Georgia. The region typically uses 10 million kilowatt-hours annually. Mdinaradze attributed the spike to large-scale unregulated mining activity.
“Large-scale illegal mining operations have led to deteriorating energy supply and grid overload, resulting in numerous outages in the region, affecting both residents and tourists,” Mdinaradze said.
The meter rollout targets villages in Mestia, a district in the Svaneti region of northwestern Georgia. Law enforcement agencies have been tasked with using the meters to locate illegal operations. Georgia does not specify which settlements will receive meters or when installation will complete.
Georgia has emerged as a major Bitcoin mining hub due to cheap hydropower from the Caucasus Mountains and favorable tax treatment, including free industrial zones and value-added tax exemptions on certain crypto-related activities. Bitfury, one of the first major mining companies to establish operations in the country, built a 20-megawatt data center in Gori in 2014.
Officials estimate illegal mining causes 20 to 25 million lari (approximately $9.4 million) in annual financial damages. The crackdown does not yet specify what penalties will apply to operators caught running unregulated facilities or whether a licensing pathway exists for miners to legitimize operations.
Under new arrangements, electricity in Svaneti will remain free for consumers up to a predetermined quantity, shielding residents from the costs of grid strain.
