How a Shipping Container and Bitcoin Saved a Struggling African Hydro Project

By Ankesh Jain
March 26, 2025

In the Ikelenge district of northwestern Zambia, a small hydroelectric power plant named Zengamina has found a novel solution to its ongoing struggles through an unexpected partner: Bitcoin. This combination of local renewable resources and cryptocurrency mining is transforming a once-diminishing energy source into an empowering economic opportunity for the surrounding community.

Zengamina’s Dimming Vision Finds a Spark

Constructed in the early 2010s with a charitable budget of $3 million, the 1-megawatt Zengamina facility was built to service the electricity needs of a rural hospital, homes, and local schools. However, for years, the plant’s output significantly exceeded local demand due to the community’s population of approximately 15,000 people and minimal commercial activity. As a result, much of the excess electricity was wasted, flowing back into the river instead of being utilized to improve the quality of life in the area.

By 2022, Zengamina’s situation had worsened. Revenue had dwindled to unsustainable levels, and future expansion plans were stalled. But then, a new partnership with a Nairobi-based startup called Gridless introduced a groundbreaking solution. They deployed a mobile Bitcoin mining unit to the site—essentially a shipping container filled with 120 application-specific integrated circuit (ASIC) mining machines.

This innovative setup was integrated into Zengamina’s local mini-grid, allowing it to consume the excess electricity that would otherwise go unused. By converting this “stranded” power into Bitcoin, Gridless created a new revenue stream for the hydro plant. At current market rates, each mining machine generates roughly $5 daily, significantly contributing to Zengamina’s income—now accounting for nearly a third of its total revenue.

The immediate impacts have been tangible: reduced electricity costs, the expansion of electrical service to new households, and increased capacity utilization of the facility, allowing it to serve the community more effectively.

Gridless Rigs Offer a Plug-and-Play Fix

Zengamina is not alone in its challenges; many small-scale energy providers in sub-Saharan Africa face a similar challenge: generating power that cannot find a local market. A significant majority of mini-grids operate below their potential not due to a lack of resources but because of the insufficient demand for energy in their regions.

According to the African Mini-grid Developers Association, more than 65% of these projects remain financially unviable, relying heavily on subsidies or philanthropic support. Gridless aims to change this dynamic by installing mobile Bitcoin mining units at various hydro sites across Kenya, Malawi, and Zambia, all chosen for their ability to produce clean energy in low-demand areas.

These mining rigs act as a financial buffer, continuously utilizing available power, which allows them to generate income right from the start. In Zengamina, the infusion of consistent revenues has led to improved access to electricity and practical economic growth within the community. Local businesses are now operating later hours, and overall connectivity has seen a significant boost.

Importantly, Gridless views its involvement as temporary. As Zengamina prepares to connect to Zambia’s national grid, which is anticipated soon, the reliance on mining will lessen and potentially phase out the Bitcoin operation in favor of traditional utility relationships.

The Fine Line Between Boost and Burden

Looking ahead, Gridless aims to seek further capital for developing its own small-scale hydro projects, particularly targeting run-of-river systems that don’t require dams and can thrive in off-grid conditions. Their strategy is to incorporate Bitcoin mining into the initial stages of their projects to help establish a viable economic structure during a community’s transition toward broader electrification.

Co-founder Janet Maingi describes this approach as a “consumer-driven, adaptive energy model.” By starting with mining, Gridless hopes to eventually pivot toward long-term energy solutions that benefit local populations.

However, the idea of integrating Bitcoin mining into rural electrification raises concerns that merit attention. Some experts point out the risks of competition for energy resources, should miners vie for low-cost electricity, which could lead to potential disruptions for local consumers—similar to challenges observed in other countries experiencing a surge in Bitcoin mining.

In 2021, Kazakhstan faced a significant crisis as demand for electricity spiked due to increased mining activity after China’s crypto ban, resulting in blackouts and government intervention. The same concerns have arisen in the United States, where regulatory bodies have begun to control mining activities during peak demand periods.

Despite these issues, Gridless asserts that its operations uniquely mitigate these risks by being entirely off-grid, powered by renewable resources with close coordination with local communities. They maintain that the needs of residential and commercial users are prioritized, with the intention to scale back mining operations as local demand grows.

Still, observers remain cautious as market incentives can shift rapidly. Significant rises in Bitcoin prices, as predicted by some analysts, may lead even off-grid operators to prefer crypto revenues over community needs, raising concerns about the sustainability of this model.

Can This Model Scale?

The success of the Zengamina project has garnered attention and interest beyond Zambia, as many off-grid renewable projects begin to consider Bitcoin mining as a stabilization mechanism in regions where electricity is plentiful yet underused.

In conclusion, while Zengamina illustrates the potential for Bitcoin to serve as a lifeline for struggling energy projects, the broader viability of this model hinges on future market conditions, community impact assessments, and the establishment of regulatory frameworks that balance the needs of local populations with emerging economic opportunities. As the world continues to navigate the evolving landscape of energy and cryptocurrency, experiences like that of Zengamina could play a pivotal role in shaping sustainable solutions for rural electrification.

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