Ethiopia has reduced power supply to Bitcoin mining operations by 23% after El Niño exacerbated drought conditions.

Ethiopia has reduced its power supply to Bitcoin mining operations to 23% after water flow into dams dropped by 20%, even though the industry uses nearly a third of the country's electricity and generates 35% of the nation's revenue.

On September 15, 2026, at 12:50 PM, Bloomberg News reported that Ethiopia had drastically reduced its electricity supply to the Bitcoin mining industry to only 23% of the previously allocated amount. This was due to the El Niño phenomenon exacerbating the drought, resulting in reduced water inflow into hydropower reservoirs and impacting the country's power generation capacity.

Bitcoin mining is a significant source of revenue for Ethiopian Electric Power Corp. (EEP), accounting for 35% of EEP's total revenue in the past fiscal year. At the same time, Bitcoin mining consumes nearly one-third of the country's total electricity production of 9,730 megawatts.

The El Niño phenomenon has exacerbated drought in Ethiopia, resulting in a 20% reduction in water inflow into hydroelectric reservoirs. This has forced the Epidemic Intelligence Agency (EEP) to limit power supply to energy-intensive cryptocurrency mining operations in order to conserve electricity for manufacturing and household use.

Ashebir Balcha, CEO of EEP, stated that when signs of a dry season approached, the organization reduced power supply to Bitcoin mining businesses to 75%, before further reducing it to 50% when the situation worsened, and most recently to just 23%.

Although cryptocurrency trading remains illegal in Ethiopia, the East African country is open to Bitcoin mining operators from China, who invest because Ethiopia has one of the lowest electricity costs in the world.

Ethiopia currently has power purchase agreements (EEP) with 39 Bitcoin mining companies, 31 of which are already operational. Under these agreements, EEP has pledged to deliver at least 98% of the contracted electricity volume.

However, EEP plans to reassess the situation in October, and if the drought does not improve, it may be necessary to further reduce power supply to Bitcoin mining businesses, as well as restrict electricity exports to neighboring countries.

The impact of the drought has also led EEP to revise down its forecast for electricity export revenue in the current fiscal year by 40% to $279 million, reflecting the pressure that water scarcity is putting on Ethiopia's energy sector.

Reference: www.bloomberg.com

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