What Is the Concept of a “Breakeven” Electricity Rate for a Miner?

The "breakeven" electricity rate is the maximum price per kilowatt-hour (kWh) a miner can pay for electricity while still covering their operational costs. This calculation is critical for profitability analysis.

It considers the miner's hardware efficiency (hashes per watt), the current mining difficulty, the cryptocurrency's market price, and block rewards (including fees). If the actual electricity cost is below the breakeven rate, the mining operation is profitable.

If it is above, the miner is operating at a loss. This metric forces miners to be highly strategic about their geographic location and energy sources.