The European Commission, the bloc's executive body responsible for introducing the new law, said EU members should prepare to ban cryptocurrency mining as the region prepares for an uncertain winter.
The European Union is also developing an energy efficiency label for blockchain as gas cuts from Russia raise concerns about rising electricity prices, outages and power shortages.
"If load reduction on the electricity system is required, [European Union] member states should also prepare to ban the mining of crypto assets," the Commission said in a document published on Tuesday. Load shedding occurs when a power company deliberately cuts off supply to a specific group of users to avoid a complete grid failure.
The Commission added: "In the coming months and years, the Commission intends to take various measures to improve digital energy services by ensuring energy efficiency in the ICT (information and communication technology) sector, including ... efficiency indicators of energy for the blocks."
In the long term, "it is also important to end the tax cuts and other financial measures that benefit crypto miners that are currently in place in some member states," the committee said.
The commission said that crypto's energy consumption had grown by 900% in five years, accounting for about 0.4% of global electricity use, and promised another report on the matter by 2025, which could recommend further steps to reduce the use of crypto-energy. He added that Europe accounts for 10% of active mining in the world.
Officials are particularly concerned about the energy consumption of proof-of-work technology, which transfers computing power to new bitcoins. European Union lawmakers are close to changing crypto laws in what some have called a ban on bitcoin, while the US White House has called for new industry standards.
Read also: The EU Parliamentary Committee rejected the proposal for the limitation of work
Update (October 18, 14:45 UTC): Added numbers for the European segment of international mining.