This Earth Day analysts say Bitcoin mining is naturally gravitating to green energy

April 22 is Earth Day and with envi­ron­men­tal sus­tain­abil­i­ty one of the key top­ics in the glob­al debate sur­round­ing Bit­coin min­ing, ana­lysts say the indus­try has begun to nat­u­ral­ly grav­i­tate towards clean­er and cheap­er ener­gy sources.

Accord­ing to a Jan­u­ary report by the Bit­coin Min­ing Coun­cil, by Q4 2021, the glob­al Bit­coin min­ing indus­try ran on an esti­mat­ed 58.5% renew­able energy.

The pref­er­ence for clean ener­gy is due to a com­bi­na­tion of envi­ron­men­tal con­sci­en­tious­ness, polit­i­cal pres­sures, and an eye on the bot­tom line. It’s result­ing in a sea change that could have rip­ple effects that extend well beyond Bit­coin (BTC) min­ing onto pow­er grid sys­tems around the world.

Bit­coin min­ers in Nor­way are clean­er than almost any­where else on the plan­et thanks to the country’s access to hydropow­er and oth­er renew­ables. In fact, 100% of Norway’s elec­tric­i­ty is gen­er­at­ed from renew­able energy. 

Of Norway’s 157 Ter­rawatt hours (TWh) of pow­er pro­duced per year, 88% is from hydro­elec­tric, with wind and ther­mal force mak­ing up the remainder. 

Min­ers use that renew­able ener­gy to pro­duce about 1% of the total Bit­coin hashrate accord­ing to data from blockchain research firm Coin­Shares.

Mas Nakachi is Man­ag­ing Direc­tor of Mia­mi-based XBTO Group’s Bit­coin min­ing oper­a­tion XBTO. Found­ed in 2015, XBTO’s min­ing oper­a­tion takes in upwards of $25 mil­lion per year and claims to be com­plete­ly pow­ered by renew­able ener­gy sources. 

He believes “hydropow­er is one of the most reli­able renew­able ener­gy sources avail­able to us.” 

Wind pow­er depends on the weath­er and solar pow­er depends on day­light, but rivers can flow all day every day — and in var­i­ous locales water can be pumped uphill dur­ing off peak peri­ods as a way to store excess ener­gy to run gen­er­a­tors when need­ed. Nakachi told Coin­tele­graph that: 

“Har­ness­ing hydro­elec­tric pow­er has remained an effec­tive mech­a­nism to main­tain the most effi­cient min­ing possible.”

Where­as a Feb. study pub­lished in the Ener­gy Research & Social Sci­ence jour­nal con­clud­ed “cryp­tocur­ren­cy is unsus­tain­able by design,” Nakachi believes there is a sim­ple path for min­ing oper­a­tions to devel­op both an eco­nom­i­cal­ly and envi­ron­men­tal­ly sus­tain­able model: 

“Pri­or­i­tiz­ing some form of clean ener­gy to pow­er the major­i­ty of oper­a­tions is, in the long term, a sus­tain­able mod­el for suc­cess­ful min­ing operations.”

As report­ed by Coin­tele­graph, anoth­er option being explored in Texas is the uti­liza­tion of flex­i­ble data cen­ters which can switch from the pub­lic grid to tem­porar­i­ly gen­er­at­ing its own clean ener­gy from ded­i­cat­ed ener­gy gen­er­a­tors to relieve stress on the grid dur­ing peri­ods of high retail demand. 

Relat­ed: Marathon Dig­i­tal moves Mon­tana BTC mine to pur­sue car­bon neutrality

Tech entre­pre­neur and self-pro­claimed envi­ron­men­tal­ist Daniel Bat­ten described a mul­ti-pronged way in which the Bit­coin min­ing indus­try is cre­at­ing pos­i­tive change on the April 22 pod­cast from Brave New Coin. Bat­ten argued that Bit­coin min­ing incen­tivizes build­ing renew­able ener­gy plants and helps decar­bonize pow­er grids.

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BREAKING: #BTC Min­ing can dri­ve us to 70% renew­ables-based ener­gy con­sump­tion by 2030. 

To say “#BTC min­ing is good for the envi­ron­ment” is like say­ing “the sun is warm”: a mas­sive under­state­ment. #BTCmin­ing is our unex­pect­ed super­hero. Here’s how.https://t.co/Arl1zZXTY6 pic.twitter.com/AleegYAbwM

— Daniel Bat­ten (@DSBatten) April 13, 2022

Bat­ten believes Bit­coin min­ing dri­ves increased demand for elec­tric­i­ty and there­fore invest­ments in renew­able ener­gy plants. Min­ing is suit­ed to inter­mit­tent pow­er sources and it can be eas­i­ly moved to far flung locales to take advan­tage of excess gen­er­a­tion of renew­able electricity.

The only prob­lem that Bat­ten sees is that the indus­try may not be big enough to incen­tivize all the renew­able ener­gy required:

“My only real con­cern is ‘Is Bit­coin min­ing requir­ing enough elec­tric­i­ty to help us build up that grid to the extent we need to?’”