Bitcoin miners revived a dying coal plant – then CO2 emissions soared | Cryptocurrencies
EMontana environmentalists called it the “death watch.” After years of financial losses, one of the few remaining coal-fired power plants in the state seemed doomed, its likely fate delivering a small but remarkable victory in the effort to avert disastrous climate change. But then a bitcoin mining company stepped in to resurrect it.
The Hardin Generating Station, a 115-megawatt coal-fired power plant located a dozen miles from the historic site of the famous Battle of the Little Big Horn in southern Montana, was scheduled to close in 2018 due to a lack of customers just to limp, run in just 46 days in 2020. “We were just waiting for this thing to die,” said Anne Hedges, co-director of the Montana Environmental Information Center. “They were struggling and looking to shut down. It was on the edge of the abyss. And then this cryptocurrency company came along.
In a deal struck in late 2020, Marathon, a bitcoin “mining” company, became the sole recipient of power from the plant. He has established an elongated data center on 20 acres of land next to the facility which contains more than 30,000 Antminer S19 units, a specialized computer that mines bitcoin. Such a thirst for energy is common in crypto – globally, bitcoin mining consumes more electricity than Norway, a country of 5.3 million people.
When the bitcoin miners moved in last year, Hardin came alive. In the first nine months of 2021 alone, the plant’s boilers fired on 236 different days. Global warming emissions from the burning of Hardin’s coal have also soared, with 187,000 tonnes of carbon dioxide emitted in the second quarter of last year, more than 5,000% more than what was reported. was expelled during the same period in 2020.
In the third quarter, an additional 206,000 tons of CO2 were emitted, an increase of 905% compared to 2020, according to data from the Environmental Protection Agency (EPA). Hardin was operating “nearly at capacity,” Marathon said in a December update, with the data center producing about 34 bitcoins on December 1.
“I was horrified to see all of this happen, it was a terrible turn of events,” said Hedges, who began touring the factory and photographing the new data center as it unfolded. was taking shape, fans perched on its roof to help cool the humming computer. Equipment. “It’s not helping old ladies freeze to death, it’s to enrich a few people while destroying our climate for all of us. If you’re concerned about climate change, you should have nothing to do with cryptocurrency, it’s a disaster for the climate.
Hardin is part of a wave of US “zombie” fossil fuel mills that have been brought back from the dead by cryptocurrency companies seeking to meet the insatiable energy demands of their mining operations. China, formerly the epicenter of the bitcoin industry, effectively banned around half of the world’s currency miners last year and the resulting search for cheap energy has seen companies take an interest in US power plants in trouble.
In 2020, a mothballed coal-fired power plant in upstate New York was converted to run on gas and power a large-scale bitcoin mining operation, a move that owner Greenidge Generation says “brings part of the world’s digital future” to the state. Eric Adams, New York’s new mayor who has said he will accept his first bitcoin paycheck, last week criticized the environmental impact of crypto mining.
Meanwhile, in western Pennsylvania, thousands of bitcoin mining computers have been packed into shipping containers next to the Scrubgrass plant, which burns coal waste and was set to close before to switch to bitcoin. And in Kentucky, a new bitcoin facility is being built next to the Big Rivers Electric Corporation, which owns and operates four coal-fired power plants.
This tactic, according to crypto firms, generates local jobs – Kentucky aimed to attract currency miners by passing a law that exempts them from an electricity sales tax – and uses excess electricity without overloading the network for homes and businesses. But critics point out that the huge electricity consumption needed to support virtual currency is fueling the climate crisis and now threatening a partial coal resurrection in the United States.
“Coal and natural gas-fired power plants used to mine cryptocurrencies that would otherwise be on the way out as we decarbonize are adding even more carbon to the atmosphere at a time when we should be reducing those emissions” , said Benjamin Jones, a specialist in natural resource economics at the University of New Mexico. “Crypto’s continued or increasing use of electricity from fossil fuels imposes significant environmental economic costs on society.”
Jones said it’s “disturbing” to see bitcoin’s already enormous energy consumption growing and most of it coming from fossil fuels, despite some efforts by mining companies to increase the amount of clean energy they use. use – Marathon, the company that draws power from Hardin, has a separate deal in Texas to take power from a wind farm.
Even some of bitcoin’s early champions balked at its power consumption, with Elon Musk halting Tesla’s use of the cryptocurrency last year because, he said, the electric vehicle company is “concerned about the increasing use of fossil fuels for bitcoin mining and transactions.” especially coal, which has the worst emissions of all fuels.” Uber, the ride-sharing service, said it will not accept crypto payments until climate impacts are reduced.
Just over a decade ago, it was possible to mine bitcoin with a single home computer, using a negligible amount of electricity. The ultimate supply of bitcoins was limited, and new bitcoins were awarded to those who could help validate transactions – miners.
The validation process is basically playing a giant guessing game that gets harder as miners participate. As interest in bitcoin has skyrocketed, fast and powerful warehouse-packed computers now have a better chance of winning the guessing game and being rewarded with multiple bitcoins, which are currently worth around 42,000. $ each.
This race for bitcoin wealth is gobbling up a huge amount of electricity – around 0.5% of total global consumption. The energy used to mine bitcoin every 60 seconds would be enough to power the average American household for 17 years, while the annual electricity consumption for mining would be enough to power all the kettles used to boil water. water for tea in the UK for 28 years.
Although this usage has been criticized by climate activists, bitcoin miners argue that it should be placed in a different context. Fred Thiel, CEO of Marathon, said moving physical goods around the world, and even using washing machines in the United States, consumes more energy than bitcoin. “I understand some people’s desire to point to bitcoin mining as the big bad boy, but compared to all the other industries, it’s insignificant,” he said in an interview.
Thiel compares bitcoin mining to transactions processed in data centers by companies such as Amazon and Google and claimed the industry is rapidly moving towards renewable energy – Marathon plans to phase out its use of coal l next year – after finding his options were limited when the miners had to quickly leave China.
“Step back to 2020, renewable energy companies weren’t offering power to bitcoin miners,” Thiel said. “Very few people even wanted to deal with bitcoin miners in the energy world. And so bitcoin miners spent time looking for locked assets. And so the only way for us to mine was to find stranded energy, which we did by finding the Hardin factory.
It remains to be seen whether bitcoin will move significantly away from fossil fuels, but in the meantime it will likely come under increasing scrutiny due to its appetite for fuel-powered electricity. fossils. “We just don’t know what emissions from bitcoin mining will look like in five to 10 years,” said Jones, a professor at the University of New Mexico. “It seems likely, however, that it will continue to be a big energy consumer in the future.”