Why You Should Care About Bitcoin if You Care About the Planet

Bitcoin, the first and most famous cryptocurrency, now burns as much energy and pumps out as much greenhouse gases as entire nations.

Current estimates put the electricity consumption of the currency on an equal footing with countries like the Netherlands. That is, we say not helpful at a time when humanity is racing to switch to clean energy before we cook the planet.

In fact, Bitcoin’s energy needs are so high that the people who get rich from manufacturing want to pull dirty power plants out of retirement to keep their operations running. Earthjustice is urging regulators not to allow this to happen.

Bitcoins are not physical coins, so you might be wondering why a virtual currency uses a lot of energy?

The appeal of Bitcoin to some people is that they cannot trust any person, bank, or government. Bitcoin is completely decentralized. But there has to be a system in place to prevent scammers from making copies of the coins and trying to spend them twice.

To solve this problem, the system provides an incentive for many people rather than a trustworthy entity to provide computing power for the validation of transactions. The system is competitive and only gives out new bitcoins to a “miner” who does the validation and other tasks first, leading to an arms race of faster and more powerful computer rigs. While other cryptocurrencies use much less energy, it turns out that Bitcoin’s special solution for security without trust is extremely energy-intensive.

This is what a modern Bitcoin mining operation looks like in New York State:

This monster needs a lot of energy to run the machines and keep them from overheating. The cooling system for this facility uses cold water from Lake Seneca and discharges it again at over 100 degrees, which kills trout and increases harmful algal blooms. For years, Bitcoin miners have been looking for places to settle, where electricity is cheap and the climate is cool, like Inner Mongolia in China or the water-rich Pacific Northwest.

But the mining operation pictured above took it to the next level. They own their own damn power plant:

The Greenidge generation powerhouse in New York.

US Department of Energy

Investors bought this plant in 2014. It was a fixer upper. Mothballed power plants for sale are typically dirty fossil fuel power plants.

The Greenidge Generation station in New York was built in the 1930s as a coal power plant. By 2011 there wasn’t enough demand for its expensive, dirty electricity and it closed. After several years of inactivity, the new owners switched their fuel to dirty gas and resumed operations using the facility’s old pollution permits.

The plant struggled to find demand for his stream, and operators turned their attention to mining Bitcoin instead. The pollution began to skyrocket. In just one year, greenhouse gas emissions have increased tenfold. The facility currently consumes 19 MW of electricity, enough to supply 14,500 households with electricity if it weren’t for mining Bitcoin. And it is planned to increase to 55 MW and the capacity to 106 MW. At full capacity, the facility would exceed its current pollution permit – but that permit must be renewed.

Earthjustice and the Sierra Club have sent a letter to regulators calling on them not to allow Greenidge Generation LLC company to expand the air permit and to be aware of the emerging trend of cryptocurrency miners taking over power plants and operating them 24 hours a day, 7 days a week, 365 days a year Year. At least one other plant in the region plans to jump into the game, and there are nearly 30 plants in New York state alone that have the potential to move to full-time bitcoin mining. A coal-fired power plant in Montana is also being restarted for mining cryptocurrencies.

“The aim of the letter to the New York Department of Conservation is to say that this is not a random or isolated matter. Cryptocurrency is real and growing in importance, and dirty power plants are coming back from the dead, ”said Mandy DeRoche, Earthjustice attorney. “Greenidge has just given other retired, retired, or emerging companies a roadmap on how to do it, how to recruit investors, how to get on NASDAQ.”

Earthjustice has fought for years on public utility commissions across the country to ensure that old, dirty power plants are being retired – and when backup power is needed, avoid dirty gas in favor of clean energy. Our goal is to speed up the day when everything runs on 100% clean energy.

New York state has a new climate law, and DeRoche says commitments made in that law will not be met if dirty power plants are revitalized and run 24/7. This should spur legislators and regulatory authorities to clarify the regulatory gray area that miners have exploited here by generating electricity that is not fed into the grid.

“There are many ways to address this problem and we are investigating them,” says DeRoche. “One solution could be to require renewable energy for mining cryptocurrencies, with an additional need for renewable generation so that mining does not prevent renewables from being fed directly into the grid. We need this clean electricity on the grid as soon as possible to mitigate the unequal and most damaging effects of climate change. “

The climate crisis is accelerating, and we have less than a decade to drastically cut our carbon emissions if we hope to save a planet worth living in. Tell your members of Congress that it is time to use the American Jobs Plan to build a sustainable and just future.

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