{"id":997570,"date":"2023-02-18T14:00:00","date_gmt":"2023-02-18T14:00:00","guid":{"rendered":"https:\/\/grist.org\/?p=602449"},"modified":"2023-02-18T14:00:00","modified_gmt":"2023-02-18T14:00:00","slug":"can-crypto-mining-go-green-critics-are-skeptical","status":"publish","type":"post","link":"https:\/\/radiofree.asia\/2023\/02\/18\/can-crypto-mining-go-green-critics-are-skeptical\/","title":{"rendered":"Can crypto mining go green? Critics are skeptical"},"content":{"rendered":"\n

This story was reported by <\/em>InvestigateWest<\/a><\/em>, an independent news nonprofit dedicated to investigative journalism in the Pacific Northwest. Visit invw.org\/newsletters<\/a> to sign up for weekly updates.<\/em><\/p>\n\n\n\n

The word \u201csustainable\u201d features prominently on the website for Merkle Standard\u2019s crypto mining operation in remote eastern Washington, which aims to be carbon neutral by year\u2019s end.<\/p>\n\n\n\n

In Idaho, budding company GeoBitmine plans to meet its \u201cenvironmental, social, and governance mandate\u201d by using heat waste from its computers to grow crops in a greenhouse. <\/p>\n\n\n\n

And in Texas, crypto miners trumpet their presence as eager customers of a growing portfolio of wind and solar power projects.<\/p>\n\n\n\n

Across the country, cryptocurrency miners are striving to remake the image of their industry in the public\u2019s and policymakers\u2019 minds: from flighty to reliable, from all about profit to altruistic, from energy guzzling and emissions heavy to climate conscious.<\/p>\n\n\n\n

\u201cWe want to be allies, not adversaries,\u201d said Jay Jorgensen, founder and CEO of GeoBitmine, the Idaho company. \u201cAllies of the earth, of energy, of energy production, of the community we\u2019re in.\u201d<\/p>\n\n\n\n

But environmental groups and researchers are skeptical. They point to the industry\u2019s track record of contributing to greenhouse gas emissions and e-waste, as documented by federal agencies and independent researchers, and to the general volatility of crypto\u2019s first decade-plus of existence.<\/p>\n\n\n\n

\u201cI think there\u2019s been a big shift in the public relations aspect,\u201d said Nick Thorpe, climate and energy advocate with Earthjustice, an environmental law nonprofit that produced a sweeping report in 2022 on the crypto mining industry\u2019s environmental liabilities. <\/p>\n\n\n\n

\u201c(They\u2019re) attempting to say all of the various talking points, like \u2018We incentivize renewable energy \u2026 We\u2019re near a wind farm so therefore we\u2019re getting 100 percent clean energy,\u2019 which, frankly, is incredibly misleading and very much like greenwashing.\u201d <\/p>\n\n\n\n

Voices from both camps are clamoring for the ear of state and federal policymakers who are just beginning to form regulations around the nascent industry. The ongoing question is whether crypto mining will hinder or help progress toward transitioning the country away from fossil fuels and stabilizing the nation\u2019s electrical infrastructure.<\/p>\n\n\n\n

Based on the industry\u2019s history, even some crypto miners are striking a cautious tone.<\/p>\n\n\n\n

\u201c(With) the pace of movement, plus the frankly irresponsible nature of many of the participants, it would be illogical for policymakers to not be concerned,\u201d said Malachi Salcido, a Wenatchee-based bitcoin miner with a decade of experience in the industry. \u201cThe way that will change is not by arguing or entering into conflict. It\u2019s by managing loads responsibly over time, taking strategic long-term positions, and earning trust.\u201d<\/p>\n\n\n\n

\"\"
Ant Boxes (with SR-20 in the background) outside the Merkle Standard cryptocurrency mining facility in Usk, Wash. on Friday, Sept. 9, 2022.\n Erick Doxey\/InvestigateWest<\/cite><\/figcaption><\/div><\/figure>\n\n\n\n

Volatility and climate toll<\/h3>\n\n\n\n

Crypto mining faces growing scrutiny about its climate impacts.<\/p>\n\n\n\n

Concerns center mostly on the process of bitcoin mining, which uses a system called \u201cproof of work.\u201d It is energy-intensive by design, requiring computers to solve thousands of equations as quickly as possible in the hopes of solving the correct sequence to earn bitcoin.<\/p>\n\n\n\n

A 2022 Biden administration report stated the industry consumed about 1 percent of the electricity used in the country, producing between 25 million and 50 million metric tons of carbon dioxide annually.<\/p>\n\n\n\n

Like data centers, crypto mining operations also use water as coolant and churn through computers every year. That same White House report stated that crypto mining was responsible for e-waste output equivalent to that produced by the entire nation of the Netherlands. <\/p>\n\n\n\n

But some crypto miners have been innovating and pushing back, arguing that the industry has the ability to do better for the planet.<\/p>\n\n\n\n

Jorgensen is among them. He\u2019s been involved with the bitcoin mining industry for two and a half years, beginning as a contractor. Now, he\u2019s gathering investors to launch GeoBitmine, which he plans to set up in Idaho Falls this spring. <\/p>\n\n\n\n

Jorgensen refers to GeoBitmine as an \u201cagrotech company\u201d rather than a bitcoin mining operation. He said his focus with most of the five-acre facility is to build a greenhouse heated by the servers working away at mining bitcoin. That can employ at least 30 people initially, he estimated.<\/p>\n\n\n\n

In short, he said, he wants to expand upon the mission of bitcoin mining. <\/p>\n\n\n\n

\u201cI\u2019m a practical guy who wants to solve problems and do it the easiest way possible,\u201d he said. \u201cWe have problems with water consumption, food production, and our energy grid needs to be stabilized. I found an opportunity where all those things can be put together.\u201d<\/p>\n\n\n\n

GeoBitmine aims to be carbon-neutral by the end of 2023, Jorgensen said. His plan to achieve that relies on a combination of 75 percent renewable power supply provided by PacifiCorp, energy savings from repurposing server heat through the greenhouse and carbon sequestration through the crops grown in the greenhouse.<\/p>\n\n\n\n

In response to questions about the value of using so much energy to mine bitcoin, Jorgensen points to other uses of electricity such as Netflix streaming, which, according to one 2020 estimate, uses about 94 terawatt hours globally each year.<\/p>\n\n\n\n

\u201cYou\u2019re just being prejudiced against something that uses less than 1 percent of the grid,\u201d he said. \u201cPeople fear what they don\u2019t understand.\u201d<\/p>\n\n\n\n

\"The
Ant Boxes during the preparation process at the Merkle Standard cryptocurrency mining facility in Usk, Wash. on Friday, Sept. 9, 2022.\n Erick Doxey\/InvestigateWest<\/cite><\/figcaption><\/div><\/figure>\n\n\n\n

Salcido, CEO of Salcido Enterprises, has watched many mining operations rise and fall as the value of bitcoin fluctuated wildly during his 10 years in the business, which justifies the caution from utilities and policymakers.<\/p>\n\n\n\n

Given the ongoing volatility of the industry, Salcido said, he doesn\u2019t fault utility companies for setting higher rates for crypto customers in order to protect their assets, or lawmakers for being cautious. He believes it\u2019s too early for crypto miners to try to burnish their environmental credentials in the minds of the public.<\/p>\n\n\n\n

\u201cTrue sustainability requires a lot of strategic, thoughtful planning and execution, not lurching,\u201d Salcido said. \u201cThat, coupled with the fact that crypto as a new emerging, evolving industry has a get-rich-quick kind of attribute, means most people don\u2019t see it as sustainable. And in these early market cycles, it\u2019s not acting sustainable.\u201d<\/p>\n\n\n\n

With time and experience, though, he still believes that it can become so.<\/p>\n\n\n\n

A bet on potential?<\/h3>\n\n\n\n

An infamous crypto mining project in upstate New York that reopened a mostly defunct coal plant to power its servers was what initially spurred Earthjustice\u2019s work around crypto mining.<\/p>\n\n\n\n

Thorpe, the senior associate with the nonprofit, became involved as environmental impacts of crypto mining \u201cbecame a bigger and bigger issue across the U.S.\u201d<\/p>\n\n\n\n

Earthjustice found several other examples of the industry reopening fossil fuels plants or keeping them online as it studied the industry throughout 2022.<\/p>\n\n\n\n

Using public filings with utility and financial regulators, investor presentations and media reports, the nonprofits vetted claims that crypto mining is embracing greener practices and mitigating its environmental toll. In partnership with the Sierra Club, Earthjustice compiled that research to present to federal policymakers. <\/p>\n\n\n\n

They describe their research as \u201cthe first attempt to comprehensively document the explosive growth of cryptocurrency mining in the United States and examine how this industry is impacting utilities, energy systems, emissions, communities, and ratepayers.\u201d<\/p>\n\n\n\n

Earthjustice found through its research that even in cases where mining operations claimed to be drawing directly from renewable projects, \u201cmost mining facilities draw power from the grid \u2014 meaning their electricity is generated by whatever existing energy is in place in the region, or is contracted by their utility.\u201d<\/p>\n\n\n\n

\u201cIncreased load on any grid means an increased incentive to run that coal plant which supposedly was going to retire,\u201d Thorpe said. Additionally, \u201cI haven\u2019t seen any example of crypto building out additional clean energy projects solely for their operations.\u201d<\/p>\n\n\n\n

Crypto miners also say the industry can contribute in other ways due to its flexibility in power usage. Unlike data centers, crypto mining operations can stop running their computers to ease pressure on the grid during times of peak demand. Or they can ramp up usage during times when energy generation exceeds the grid\u2019s current capacity.<\/p>\n\n\n\n

\"a
Servers at the Merkle Standard cryptocurrency mining facility in Usk, Wash. on Friday, Sept. 9, 2022.\n Erick Doxey\/InvestigateWest<\/cite><\/figcaption><\/div><\/figure>\n\n\n\n

States have mostly been relying on subsidies or lower rates from utilities to incentivize crypto miners to disconnect during surges, rather than mandates that require them to do so. <\/p>\n\n\n\n

Jorgensen said that tactic is effective: It makes financial sense for miners to avoid heightened costs of electricity during peak demand and to receive the tax benefits or rate benefits that come from disconnecting for a while.<\/p>\n\n\n\n

Environmental advocates point out that ratepayers subsidize those incentives for crypto miners, however, without getting any benefit from sharing the grid with those operations.<\/p>\n\n\n\n

Earthjustice also said it found many more instances of power companies getting stuck holding the bag for investments they made to serve crypto operations, only to have those same operations shutter or leave town. The group noted instances in Kentucky, Arkansas, Nebraska and Washington.<\/p>\n\n\n\n

Thorpe acknowledged that the industry is still talking about ways to improve. But for climate groups, the past and present make for more compelling arguments.<\/p>\n\n\n\n

\u201cWe are focused on what\u2019s happening right now,\u201d he said. \u201cFossil fuel plants are being run to exclusively mine bitcoin. Proof of work is designed to be energy-intensive. Until that changes, I don\u2019t see a future where it actually could follow the models of other companies like Google and Microsoft that have made commitments to run on carbon-free electricity.\u201d<\/p>\n\n\n\n

InvestigateWest<\/a> is an independent news nonprofit dedicated to investigative journalism in the Pacific Northwest. This story was made possible with support from the Sustainable Path Foundation.<\/em><\/p>\n

This story was originally published by Grist<\/a> with the headline Can crypto mining go green? Critics are skeptical<\/a> on Feb 18, 2023.<\/p>\n

This post was originally published on Grist<\/a>. <\/p>","protected":false},"excerpt":{"rendered":"

Some miners are promising more climate-friendly operations, but research shows the industry is a long way from putting that into practice.<\/p>\n","protected":false},"author":26534,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[109,369],"tags":[],"_links":{"self":[{"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/posts\/997570"}],"collection":[{"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/users\/26534"}],"replies":[{"embeddable":true,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/comments?post=997570"}],"version-history":[{"count":1,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/posts\/997570\/revisions"}],"predecessor-version":[{"id":997571,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/posts\/997570\/revisions\/997571"}],"wp:attachment":[{"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/media?parent=997570"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/categories?post=997570"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/tags?post=997570"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}