During the DC Blockchain Summit, executives from the industry stated that cryptocurrency mining creates a need for renewable energy by purchasing excess power.
A blockchain-related policy gathering in Washington presented an argument for cryptocurrency mining focused on its positive environmental impact. This “green” perspective did not refer to US dollars but sustainability.
Bitcoin mining has gained a negative reputation due to its high energy consumption, with mining companies even reopening coal-based power plants to fuel their operations. However, the speakers at the DC Blockchain Summit organized by the Chamber of Digital Commerce argued in favor of responsible and sustainable mining practices that utilize renewable energy sources.
Texas is among the states in the US with a significant proportion of renewable energy production, with wind, Solar, and hydroelectricity accounting for forty percent of the state’s total energy output. However, gas remains the largest contributor at forty-one.
Riot, a company based in Texas, did not respond to a question about the types of energy it uses in its facilities in the state. In a letter to House Energy and Commerce Committee members in September of 2022, the company explained that it has no control over the energy sources available on the Texas power grid.
Crypto Mining Companies’ Reaction
Morgensten highlighted that Riot could swiftly shut down its mining equipment in response to sudden increases in demand. He stated they could power down their mining equipment within a very short period.
The company based in Colorado has a financial motivation to act accordingly: The Electric Reliability Council of Texas, which oversees the Texas power grid, provides rebates to industrial customers who reduce their energy consumption. In July last year, Riot earned more revenue from these rebates than from mining BTC.
The speakers echoed similar sentiments during a different discussion panel, which included representatives from three other mining companies. Matthew Schultz, the executive chair of CleanSpark, commented that the demand created by cryptocurrency mining incentivizes utility companies to develop more renewable energy capacity.
He explained that Bitcoin is well-suited for this purpose, as surplus renewable energy can be sold to mining companies. CleanSpark, a company headquartered in Henderson, Nevada, has announced that in their fiscal year 2022, ninety-four percent of their energy was carbon-free.
Eleni Stylianou, a spokesperson for the company, clarified that this percentage accounts for the renewable energy credits acquired via Georgia Power’s Simple Solar program. Hive Blockchain Technologies’ general counsel, Gabriel Ibghy, stated that their company offers demand response as a service, which entails the automatic shutdown of mining rigs during periods of high demand.
According to Ibghy, the company is fully integrated with the grid operator, ensuring that the process is entirely automated, and they receive compensation for it.
More about Hive
Hive, headquartered in Vancouver, has established its facilities in Canada, Iceland, and Sweden, as it can access one hundred percent renewable energy in each location. According to Ibghy, the company also purchases off-peak power that would otherwise go unused and, in doing so, generates revenue for utilities by monetizing an underutilized resource.
Hive has discovered a use for the heat generated as a byproduct of its mining facilities. In Sweden, for instance, one such facility will heat a neighboring greenhouse, reducing its carbon footprint by decreasing its reliance on food imports. This situation means there will be less need to transport cucumbers and tomatoes from Spain to northern Sweden.