Dive Brief:
- The U.S. Department of Energy and the Environmental Protection Agency should require crypto mining companies to report their energy use and associated carbon emissions, a group of six lawmakers led by Sen. Elizabeth Warren, D-Mass., said in a Friday letter to the agencies.
- Miners are using “disturbing” amounts of energy with little oversight, and significant growth is still anticipated. Six large operations have developed more than 1 GW of capacity for mining, according to the letter.
- Mining operations are increasingly moving to the United States, following a crackdown on energy consumption and pollution by China last year. Lawmakers warned DOE and EPA that the U.S. share of global Bitcoin mining increased from 4% in August 2019 to nearly 38% in January.
Dive Insight:
More than a third of the global computing power utilized by crypto miners is in the United States and this is “likely to be problematic for energy and emissions,” the group of lawmakers told the Biden administration.
The group sent letters to seven large crypto mining companies, requesting information on their energy use. The results of the investigation “are disturbing … revealing that crypto miners are large energy users that account for a significant – and rapidly growing – amount of carbon emissions,” the group said.
Six companies responded with specific energy use data: Greenidge, Riot, Bitdeer, Stronghold, Marathon and Bit Digital. Those miners have developed “nearly enough capacity to power all the residences in Houston,” lawmakers said, and loads are expected to grow. A seventh company, Bitfury, was asked for information but did not provide specific energy use data.
Some experts believe the electricity load used for crypto mining in the U.S. will reach almost 10,000 MW in the next five years. Texas alone could see 5,000 MW of new demand by 2023, according to crypto miners in the state.
In order to understand the crypto industry and its impacts, DOE and EPA should utilize their authorities under the Clean Air Act to require reporting of energy use and emissions from crypto miners, lawmakers said. Along with Warren, the letter was signed by Sens. Sheldon Whitehouse, D-R.I., Edward Markey, D-Mass., Jeff Merkley, D-Ore., and Reps. Jared Huffman, D-Calif., and Rashida Tlaib, D-Mich.
In particular, lawmakers are concerned about the two largest cryptocurrencies, Bitcoin and Ethereum: the global energy used to mine those coins last year resulted in almost 80 million tons of carbon dioxide emissions, they said. Total annual energy to mine those coins was estimated at 300 TWh , similar to the United Kingdom’s annual electricity use, according to the letter.
While mining companies often maintain their supplies are carbon-free or cleaner than grid-supplied electricity, the lawmakers argue 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.”
However, not all mining operations are powered by clean electricity. One respondent, Riot, said that a 51-MW facility in New York “utilizes nearly exclusively hydroelectricity.” The same company, however, has a 350-MW facility that uses power from the Texas grid, which lawmakers note relies heavily on natural gas and coal-fired generation.
Crypto miner Greenidge, located in New York, told lawmakers its facility is not generating any air emissions that are not already subject to the terms of its air permit and fully accounted for by the state’s federally approved Clean Air Act state implementation plan. In June, however, New York determined it would not extend the facility’s air permit because it would be “inconsistent with or would interfere with the attainment of the statewide greenhouse gas emission limits.”
