The largest US cryptomining companies have the capacity to use as much electricity as nearly every home in Houston, Texas; energy use that is contributing to rising utility bills, according to an investigation by Democratic lawmakers.
Cryptomining is a highly energy intensive process involving the use of specialized computers running constantly to solve complex math problems in order to create new virtual coins.
Energy use in the industry is greater than that of entire countries. The US has become the center of cryptomining after it was banned in China. More than a third of the global computing power dedicated to mining bitcoin, the largest cryptocurrency, comes from the US, Senator Elizabeth Warren and five other Democrats reported in a letter to the Environmental Protection Agency.
“The results of our investigation … are disturbing … revealing that cryptominers are large energy users that account for a significant – and rapidly growing – amount of carbon emissions,” the letter states. “It is imperative that your agencies work together to address the lack of information about cryptomining’s energy use and environmental impacts.”
The congressional Democrats have asked the EPA and the Department of Energy to require cryptominers to disclose emissions and energy use, noting that regulators know little about the full environmental impact of the industry.
The lawmakers solicited information from seven of the largest US cryptomining companies, including Stronghold, Greenidge, Bit Digital, Bitfury, Riot, BitDeer and Marathon, about their energy sources and consumption and the climate impacts of their operations. The data revealed that the industry is using a substantial amount of electricity, ramping up production and creating significant carbon emissions at a time when the US needs to drastically reduce emissions to combat the climate crisis.
Emissions data from three companies, Bit Digital, Greenidge and Stronghold, indicated their operations create 1.6m tons of CO2 annually, an amount produced by nearly 360,000 cars. Their environmental impact is significant despite industry claims about clean energy use and climate commitments, the lawmakers wrote.
“Bitcoin miners are using huge quantities of electricity that could be used for other priority end uses that contribute to our electrification and climate goals, such as replacing home furnaces with heat pumps,” the letter states.
“The current energy use of cryptomining is resulting in large amounts of carbon emissions and other adverse air quality impacts, as well as impacts to the electric grid.”
The power demands of the industry are also coming at a cost to consumers, the letter states, citing a study that found cryptomining operations in upstate New York led to a rise in electric bills by roughly $165m for small businesses and $79m for individuals.
In Texas, which has become a cryptomining hub, the industry is expected to continue to expand significantly in the coming years, increasing the amount of electrical load to nearly a third of the grid’s current maximum capacity over the next four years and straining the system, according to a report from the Verge.
“The more crypto mining that comes into the state, the higher the residents should expect the electricity prices to become,” Eric Hittinger, a professor at Rochester Institute of Technology, told the outlet.
The cryptocurrency market has crashed in recent months, dropping in value from more than $3tn in November 2021 to less than $1tn.
July 16, 2022 at 04:09PM Dani Anguiano in Los Angeles