Bitcoin is notorious for wasting enough electricity to add 40 million tons of carbon dioxide to the atmosphere a year, but now a growing number of American miners are developing green and lucrative new strategies worth their own fortunes.
Bill Spence and Greg Beard on a coal waste heap in Russellton, Pennsylvania, left behind by a mine that powered 20th-century steelmakers in Pittsburgh. They burn this polluting “gob” to mine bitcoin.
Growing up in rural western Pennsylvania in the early 1970s, Bill Spence played with his friends on piles of coal waste, oblivious to the toxic heavy metals beneath his feet. After working as an engineer in the oil industry in the west, he returned home in the 1990s to find that the piles — known as “gob,” for “garbage or bituminous” — still pockmark the landscape. The current concern is that these unlined wells will leach deadly carcinogens into groundwater — or worse, they will catch fire and pollute the air as well. (Of the 772 blobs in Pennsylvania, 38 are smoldering.) ADA Cardano is up.
Growth of Spence
So Spence, now 63, went on a mission to take down the piles, restore the land — and make money from it. In 2017, he bought control of the Scrubgrass Generating power plant in Venango County, north of Pittsburgh, which was specifically designed to burn gob. But gob is not a very good fuel and the plant was barely viable. Later that year, after being diagnosed with pancreatic failure and kidney cancer (which he speculates may be related to his early exposure to clogs), he stepped down from the company. Bored, he started dabbling in cryptocurrencies and soon had a eureka moment: he was able to make the Scrubgrass numbers work by turning gob into bitcoin.
After surgery and being removed from a feeding tube, Spence is now back at it, turning 20th-century heavy industry waste into 21st-century digital gold. About 80% of Scrubgrass’s 85,000 kilowatt output is now used to run powerful, energy-guzzling computers that validate bitcoin transactions and compete with computers around the world to solve computational challenges and earn new bitcoins – a process that known as mining. Depending on the price of bitcoin, which has recently hovered around $35,000, Scrubgrass is estimated to make an estimated 20 cents or more per kilowatt-hour (kwh) from mining, versus selling only 3 cents to the grid. In addition, because the plant safely removes waste, it is collecting tax credits for Pennsylvania renewable energy that are now worth about 2 cents per kWh, the same as that available for hydroelectric power.
Spence and his obligations
Spence is one of an emerging cohort of U.S. bitcoin miners turning one of the cryptocurrency’s greatest liabilities — its insatiable thirst for energy — into an asset. Whether they’re removing waste fuels like gob, balancing the power grid in Texas, or tapping the flares of oil and gas fields, these cryptopower entrepreneurs are benefiting by turning digital lemons into green lemonade. And with countries like China, Indonesia and Iran either severely restricting or banning bitcoin mining altogether, the opportunity for domestic producers has never been greater. From just 4% share two years ago, the US has grown to become the world’s second largest miner, now accounting for 17% of all new bitcoins, according to the University of Cambridge Center for Alternative Finance.
The Belly of the Beast: At Riot Blockchain’s bitcoin mining facility in Rockdale, Texas, the exhaust from some of the stacks of 120,000 energy-sucking computers is pushing temperatures up to 130 degrees.
Environmental disaster
For all the purported benefits of bitcoin, it is also clear that the currency is an environmental disaster. Depending on the cost of bitcoin (a higher price attracts more miners), the global network sucks between 8 and 15 gigawatts of continuous power, according to Cambridge. New York City runs at just 6 gigawatts, the nation of Belgium at 10. Exactly how much carbon is released into the atmosphere by bitcoin mining depends entirely on what energy source is used. But the pollution is not negligible. To unlock a single bitcoin, miners need to power their machines about 150,000 kWh, enough juice to power 170 average American homes for a month. Crypto Exchange FTX has risen.
It’s especially frustrating that high-energy inputs aren’t a bitcoin bug, but rather a feature. Of course, part of the e electricity is used to validate transactions, but much is apparently wasted on solving useless math problems. This proof of work is simply a way of creating artificial scarcity, making it far too expensive for a particular group to corner or manipulate the market. in a m. of 2010 essay board comment, Satoshi Nakamoto, the pseudonymous creator of bitcoin, made no apologies: “It’s the same situation as gold and gold mining. The marginal cost of gold mining tends to stay close to the gold price. Gold mining is a waste , but that waste is much less than the utility of having gold available as a medium of exchange. I think the matter will be the same for bitcoin. The utility of the exchanges enabled by bitcoin will far exceed the cost of the electricity used. ”