Bitcoin Mining, Stranded Energy, and Rural Electrification in Kenya

Summary

The December 08, 2025 episode of What Bitcoin Did features Erik Hersman, Phillip Walton, Eric Yakes, and Mark Kamau examining how Bitcoin mining can finance off-grid energy in northern Kenya. The discussion uses a planned Gridless project in the remote village of Saru to show how a large solar-and-storage site anchored by miners can deliver affordable power to households, clinics, schools, and local businesses. The episode also highlights emerging Bitcoin circular economies in Nairobi, the integration of Bitcoin with mobile money, and the broader shift of global mining toward stranded energy sites.

Take-Home Messages

1. Bitcoin-backed mini-grids: Using miners as an anchor customer allows large solar-and-storage projects in remote areas to become financially viable before local demand matures.
2. Conventional electrification has passed Saru by: High transmission-line costs and low population density mean villages in northern Kenya are absent from national grid plans, creating a structural access gap.
3. Community capital and co-op governance are pivotal: Elders in Saru consider selling camels to fund transformers and distribution, illustrating how traditional assets and local decision-making shape who benefits from new power.
4. Productive uses of electricity multiply the impact: Reliable energy enables welding, refrigeration, exam printing, and cold chains for camel milk, turning electricity from a welfare good into a driver of local enterprise.
5. Urban Bitcoin ecosystems support rural innovation: Circular economies in Nairobi’s Kibera and Bitcoin–mobile money bridges like Tanda and Mimmo show how payment rails and user habits developed in cities can extend to newly electrified villages.

Overview

Hersman and Walton open the conversation by recounting a four-day drive along the Trans-African Highway to Saru, a village near the Ethiopia border that does not appear on Kenya’s electrification map. They explain that extending transmission lines hundreds of kilometers to serve roughly 5,000 people would never meet state utility return thresholds, leaving the region effectively written off. This stark context frames Saru as a test case for whether new financing models can deliver reliable power where the grid will never go.

To address this gap, Gridless plans a 1 MW solar array with 5 MWh of storage in Saru, with Bitcoin miners acting as the initial anchor load that buys most of the power around the clock. Yakes argues that, under plausible assumptions, mining revenue alone can produce strong returns even before households and businesses consume much electricity. The group contrasts this approach with Dukana, where a donor-funded solar project deteriorated and ended up charging extremely high tariffs to some of the poorest users in the region.

Local social structures and capital play a central role in the Saru plan, with elders discussing how selling camels could finance transformers, poles, and community distribution infrastructure. Walton describes how the current energy deficit constrains clinics, schools, and enterprises, from vaccine refrigeration and nighttime births to exam printing, welding services, and food storage. Kamau emphasizes that the ambition is not minimal lighting but abundant power that can support a community-owned energy co-op and a diverse set of productive uses.

The episode then shifts toward Nairobi, where Kamau describes a Bitcoin circular economy in Kibera that includes dozens of merchants and a waste-collection business paying workers in Bitcoin via Blink. Hersman notes that tools such as Tanda and Mimmo effectively integrate Bitcoin into Kenya’s dominant mobile money system, allowing users in the capital to pay bills and move value while keeping savings in Bitcoin. Yakes concludes that as global mining competition intensifies, operators with the ability to deploy at stranded African energy sites like Saru will control some of the world’s cheapest power, shaping both hash-rate geography and local development trajectories.

Stakeholder Perspectives

1. Rural communities in northern Kenya: Seeking affordable, dependable electricity that improves health, education, and livelihoods while maintaining local control over assets and siting decisions.
2. Kenyan energy policymakers and regulators: Weighing how to encourage innovative, Bitcoin-backed off-grid models without undermining consumer protection, tariff fairness, or broader national electrification strategies.
3. Off-grid energy developers and Bitcoin miners: Looking to validate that mining-anchored mini-grids can deliver consistent returns, scale productive-use energy, and outperform past aid-driven solar projects.
4. Humanitarian and development organizations: Reassessing legacy solar programs and considering whether market-based, Bitcoin-linked infrastructure can complement or replace traditional donation-funded schemes.
5. Mobile money and fintech providers: Evaluating how Bitcoin and Lightning integrations with existing rails could deepen customer engagement, expand payment options, and open new utility and connectivity markets.

Implications and Future Outlook

The Saru case suggests that Bitcoin mining may become a standard tool in the project-finance toolkit for off-grid energy infrastructure in the coming decade. If early deployments prove that miners can reliably shoulder initial capital costs while retail tariffs remain affordable, more developers and investors are likely to pursue similar projects across remote regions in Africa and beyond. Over time, this could shift rural electrification strategies away from small donor-funded systems and toward larger, commercially grounded mini-grids that treat computing revenue as a core design variable.

At the same time, the experience in Dukana underscores how poor technical design, weak governance, and opaque pricing can leave communities paying some of the world’s highest tariffs for unreliable power. Future Bitcoin-backed mini-grids will need clear co-op structures, transparent tariff-setting mechanisms, and robust maintenance plans to avoid repeating those outcomes under a different financial wrapper. Policymakers and regulators will face increasing pressure to create frameworks that recognize mining as a legitimate industrial customer while still protecting rural users from exploitation and system failure.

Urban Bitcoin circular economies in Nairobi, combined with mobile money integrations like Tanda and Mimmo, point toward a future in which rural users can pay for power, connectivity, and goods using the same digital money they save in. As Starlink-type connectivity spreads and local wallets are optimized for low-cost smartphones, the distinction between “off-grid” communities and the global digital economy may blur considerably. In that environment, the design choices made in early experiments like Saru will influence not only who gains access to electricity, but also how people in remote regions participate in broader financial and information networks.

Some Key Information Gaps

1. How robust are the projected 30% returns and payback timelines for Bitcoin-anchored solar and storage projects in remote African communities under different price and difficulty scenarios? Credible modeling of revenue variability is essential for investors and policymakers deciding whether to back large off-grid deployments.
2. How have past NGO-led solar deployments in East Africa affected local trust, tariff expectations, and willingness to participate in new market-based energy projects? Understanding these legacy effects will help developers and regulators design Bitcoin-linked initiatives that communities perceive as fair and durable rather than as another short-lived experiment.
3. How should community co-ops in pastoralist regions structure camel-backed capital contributions and revenue sharing to ensure fair access to newly built electricity networks? Well-designed governance and financing rules are needed to prevent new power infrastructure from deepening local inequalities.
4. How does rapid transition from extreme energy scarcity to abundant electricity affect social cohesion, time use, and perceptions of well-being in communities like Saru over five to ten years? Longitudinal evidence on social outcomes will help development planners balance infrastructure ambitions with support for community resilience and cultural continuity.
5. What technical and business models work best for Lightning-based electricity meters and Starlink internet access in remote African villages where cash flows are small and irregular? Practical field testing of tariffs, hardware, and user interfaces is required to identify approaches that are both financially sustainable and accessible to low-income households.

[also see a Bitcoin mining information gap and research needs academic paper I led for more on this topic]

Broader Implications for Bitcoin

Bitcoin as an Infrastructure Financing Layer

Bitcoin mining attached to stranded or underutilized energy sources points toward a broader role for Bitcoin as a global infrastructure financing layer rather than merely a savings vehicle. By converting intermittent or remote generation into a portable revenue stream, Bitcoin can change which projects clear investment hurdles and which regions become attractive for new build-out. Over the next decade, this may influence how grids are planned, how investors evaluate risk in frontier markets, and how governments think about attracting capital for strategic energy assets.

Rethinking Development Models Beyond Aid

The contrast between Dukana’s failing donor-funded solar and Saru’s proposed mining-backed mini-grid highlights a wider challenge for traditional development models. If Bitcoin-linked projects consistently deliver more reliable services at lower tariffs than legacy aid schemes, policymakers and funders will face pressure to reconsider grant-heavy approaches in favor of co-investment and revenue-backed designs. This shift could gradually reposition Bitcoin from a niche financial instrument to a practical tool in mainstream development finance, with implications for how multilateral agencies, NGOs, and governments structure their programs.

Digital Monetary Rails and Financial Inclusion

Kenya’s integration of Bitcoin with mobile money demonstrates how Bitcoin can ride existing payments infrastructure rather than replace it outright. As similar bridges emerge in other countries, households may increasingly treat Bitcoin as a savings and settlement layer beneath familiar local interfaces, expanding financial inclusion without requiring users to abandon existing habits. In parallel, regulators will need to address new questions about consumer protection, cross-border flows, and data governance in systems where value moves seamlessly between national currencies and a global, permissionless asset.

Hash-Rate Geography and Energy Politics

Locating mining at remote African energy sites foreshadows a redistribution of global hash rate toward jurisdictions with abundant, cheap renewables or stranded resources. This trend could diversify network security away from a few industrialized regions, but it also introduces new geopolitical considerations about who effectively “hosts” critical infrastructure for the Bitcoin network. Over a three-to-five-year horizon, governments may increasingly view mining policy as a component of energy strategy, weighing local environmental impacts, revenue opportunities, and the diplomatic implications of becoming key nodes in a global monetary system.

Rural Connectivity and Socioeconomic Transformation

Projects that pair electrification with Bitcoin-enabled connectivity suggest a future in which rural communities leapfrog intermediate stages of development and plug directly into global markets and information flows. When power, internet, and digital money arrive together, local entrepreneurs can participate in broader supply chains, access remote work, and build services that were previously impossible. This convergence raises long-term questions about migration patterns, education priorities, and the balance between local economic autonomy and exposure to global shocks, all of which will shape Bitcoin’s role in rural transformation.