The report concluded that Bitcoin’s insatiable appetite for energy is driving up pollution and costs for Americans

Bitcoin miners in the United States have had a massive impact on power grids, a The New York Times investigation reveal. Mines—giant data farms—use far more electricity than the surrounding communities, leading to increased pollution from coal and gas power plants. Cryptocurrency miners also make electricity bills more expensive for their neighbors, even as companies profit from incentives offered by grid operators to prevent blackouts during an energy crisis.

This is the most comprehensive analysis to date of Bitcoin’s impact on the environment and the energy system in the United States. It comes as Democratic lawmakers pressure federal agencies to require crypto companies to disclose information about their operations. the times She has staggering numbers for individual cryptocurrency miners and the industry as a whole, which she obtained by poring over financial records, satellite images, and commissioned studies from outside research groups.

The newspaper identified 34 of the largest cryptocurrency mines in the United States, each operating at 40 megawatts or higher. Each of them, on their own, uses at least 30,000 times as much electricity as the average home in America. In Rockdale, Texas, the largest and most energy-hungry bitcoin mining facility in the country burns as much electricity as the nearest 300,000 homes combined.

In Rockdale, Texas, the largest and most energy-hungry bitcoin mining facility in the country is burning as much electricity as the nearest 300,000 homes combined.

The expansion of industry in the United States has been rapid, which is another stressor for American power grids. The United States has just become the largest in the world center of bitcoin miners after they were kicked out by China in 2021 times He compares the new energy demand coming from US cryptocurrency miners to the sudden addition of “other residences in New York City.”

See also  The Fed's Barr sees a "need" for stronger regulation of regional banks after the SVB

Bitcoin is a blockchain that intentionally requires energy. To validate transactions and generate new tokens, bitcoin “miners” use specialized hardware to solve mathematical puzzles. The amount of energy required to solve these puzzles should dissuade bad actors from messing with the ledger. The puzzles get more and more complex over time as more people try to solve them, requiring more complex programs that consume more electricity in the process.

To meet this increased demand, power grids may have to run back-up generators, usually gas or coal-fired. Two cryptocurrency mining companies have revived closed fossil fuel power plants to mine bitcoin. This has made bitcoin mining attractive to states like Texas and North Dakota that produce a lot of fossil fuels, while angering environmentalists and Democratic lawmakers trying to meet the Biden administration’s climate goals.

Pollution from the additional energy demand of bitcoin mines is on the order of the annual emissions of 3.5 million new gas guzzling cars, times reports. Industry promises that bitcoin mines will spur renewable energy growth have not materialized. Coal and gas plants meet about 85 percent of the demand that bitcoin mining adds to power grids, according to an analysis times Commissioned by the non-profit Watttime.

On top of making pollution worse, crypto-mines also affect America’s energy bills. A skyrocketing demand drives up electricity prices and forces neighboring households to compete for limited supply. Energy consumption has increased electricity bills for other customers by nearly 5 percent in Texas, according to a Wood Mackenzie analysis commissioned by times. That amounts to $1.8 billion a year in soaring electricity costs for consumers across Texas, which is home to about a third of the cryptocurrency miners examined.

See also  Investor says it's too early to buy dip, assigning 8 stocks to buy when the time is right

While they pay other people’s bills, crypto companies have been able to manipulate power systems in their favour. The operator of a Bitcoin mine in Rockdale, Texas, paid just 2.96 cents per kilowatt-hour last year, it reported to investors. This compares to the 13.5 cents residential customers typically paid that year.

How does a cryptocurrency miner get electricity so cheap? In Texas, it could benefit from a program that pays industrial companies to cut power when the grid is under too much stress. This happened in February 2021 when a severe cold snap disrupted the power supply – leaving millions of residents without electricity and eventually killing hundreds of people. During the disaster, the state power grid operator paid one crypto-mining company an average of $175,000 an hour to turn off their computers. In 2020, five mines made at least $60 million from this energy savings program, the times reports.

It’s worth checking out The whole story from timeswhich includes maps and useful data on each of the 34 crypto-mines it investigated.

Leave a Reply

Your email address will not be published. Required fields are marked *