You could, instead, ration the amount of electricity that you can consume for an industrial facility (at least at "normal" or long-term negotiated rates). Every additional KwH needs to be purchased at spot rates.
That will protect the conscientious consumers of electricity, and punish the profligate wasters (or encourage them to create their own sources of energy, preferably renewable).
Conscientious consumers of electricity are fundamentally protected because people have to pay for electricity. If you use a lot you have to spend a lot, if you use a little you don't.
What gives someone the right to tell someone else what they must use the electricity they've bought for? The only right I can think of would be an indirect one - i.e. if their use of the electricity directly broke a law (e.g. they electrocuted someone)
> What gives someone the right to tell someone else what they must use the electricity they've bought for?
Well, at its base, the law and force of government give people that right, just like any law we make gives anyone the right to tell someone else they can or can't do something.
Electricity is a common resource. Spinning up new power plants is not cheap and has environmental impact. Overtaxing a grid not prepared for the added load causes all sorts of problems for residents. We write laws all the time to encourage behavior we want and discourage behavior we don't want. There's not reason why electricity use around Bitcoin mining should be exempt from that.
This would affect not only crypto mining but also all datacenters, aluminum smelting, likely any modern or climate-neutral method of steel production, and manufacturing.
That will protect the conscientious consumers of electricity, and punish the profligate wasters (or encourage them to create their own sources of energy, preferably renewable).