All companies involved in the study were asked to explain “the impact of your facilities on energy costs for local families and businesses”, but none were able to describe existing estimates or models that tracked these effects. Those who addressed the question said it was because they didn’t expect it to have a noticeable effect on the cost of consumers’ energy bills. One company, Bit Digital, said it would be counterintuitive to study its own impact on local families and businesses because businesses are deliberately located in rural areas with excessive power supply and limited demand – they take up empty space that is not used on the grid, does not compete with consumers for power.
Bit Digital’s chief strategy officer, Samir V. Tabar, criticized Warren, et al.’s letter for being “silent about” data showing how the crypto mining company is driving job creation “in decaying economies while leveraging of unwanted energy infrastructure.” Tabar says Bit Digital is “happy to shape the industry by being leaders in the use of renewable energies,” and the company hoped the senator would see our efforts there.
With so little data reported, it remains difficult to predict how local residents and businesses will be affected by the expected growth of these businesses. Some companies said that because of pledges from crypto mining companies to switch to renewables, things could change so quickly that existing data cannot be reliably used to predict how US citizens will be affected. At least one company, Stronghold Digital Mining, claimed that “the multitude of factors that affect residential electricity costs,” such as “natural gas prices, temperature fluctuations, and other factors,” make it “difficult to attribute any change in local electricity costs.” to crypto mining. (Stronghold did not immediately respond to a request for comment.)
The congressmen think that mandatory reporting is the solution. They are especially concerned about residents and businesses in states like Texas, where “relatively cheap electricity costs” are attracting an “influx of crypto mining companies,” which could potentially “increase the stress on the state’s power grid.”
Future of cryptocurrency in the US
Warren, et al. say that since 2019, global power consumption from bitcoin mining alone has “increased nearly fourfold” — effectively erasing “the overall reduction in greenhouse gas emissions attributed to electric vehicles.”
In their responses, crypto mining companies are resisting environmental complaints by pointing out that their goal is to spend as little money on power as possible, so the largest companies are highly motivated to switch to renewable energy sources. That, companies claimed, could help the US achieve its renewable energy targets if the US supported the expansion of crypto mining, rather than restricting or banning it as China has done and India is trying to do.
Companies also say that thanks to agreements between energy companies and crypto mining companies to shut off miners’ power when there is a spike in energy demand on the grid, companies are helping to stabilize energy supplies and reduce consumer costs. Bit Digital even suggested that lawmakers consider rewarding miners who participate in these programs and encouraging more cities to adopt crypto mining partnerships. The hunger of cryptominers for growth and incentives seems, predictably, boundless.
Energy security remains a top priority in the US for most Democrats, and helping officials understand how digital currencies work remains an important part of the country’s energy consumption equation. By the end of the summer, congressmen expect the EPA and DOE to reveal how they plan to ramp up reporting on crypto mining in the US. If the agency’s response is timely, that update should arrive before President Joe Biden’s request for a September report that will partially explain the energy policy implications if the US adopts a central bank digital currency in the coming years.
This story originally appeared on Ars Technica.
