New York Democratic Senator Liz Krueger and Assemblymember Anna Kelles introduced Senate Bill S8518 on Wednesday, aiming to impose an excise tax on proof-of-work cryptocurrency mining operations due to concerns over excessive electricity use. The bill argues that mining drives up electricity costs for residents, citing research that estimates an additional $79 million annually for individuals and $165 million for small businesses statewide.
The proposed tax is tiered based on energy consumption: miners using 2.26 million to 5 million kilowatt-hours (kWh) per year would pay 2 cents per kWh, those consuming 5-10 million kWh face 3 cents per kWh, 10-20 million kWh are taxed at 4 cents per kWh, and operations over 20 million kWh would pay 5 cents per kWh. Miners using 2.25 million kWh or less are exempt, as are those relying entirely on renewable energy, to promote sustainability.
Senator Krueger stated, "The bill ensures that the companies driving up New Yorkers' electricity rates pay their fair share, while providing direct relief to families struggling with rising utility costs." Revenue would fund the state's Energy Affordability Programs for low-income households. This move aligns with New York's history of stringent crypto regulations, which have previously prompted miner relocations. With mining profitability already squeezed—median Bitcoin mining costs exceeded $70,000 in Q2 2025—the tax could further erode margins and push grid-dependent miners out of the state.
