Environmental activists see the Bitcoin mining power plant as a climate threat – nationally

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An obstacle to large-scale bitcoin mining is finding enough cheap energy to power the huge, powerful computer sets that create and transact cryptocurrency. A mining operation in central New York came up with a new solution that has frightened environmental activists. It uses its own power plant.

Greenidge Generation operates a plant that was once mothballed near the shores of Seneca Lake in the Finger Lakes region to produce about 44 megawatts to power 15,300 computer servers, plus additional electricity that it sends into the state’s electricity grid. Megawatts dedicated to Bitcoin can be enough electricity to power more than 35,000 homes.

Proponents call it a competitive way to extract increasingly popular cryptocurrencies, without draining the existing power grid.

Environmental activists see the facility as a climate threat.

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They are afraid of a wave of revived fossil fuel plants that pump out greenhouse gases more for private gain than public benefit. They see Greenidge as a test case and ask the state to deny renewal of the facility’s air quality permit and put brakes on similar projects.

“The current state of our climate requires measures for cryptocurrency mining,” said Liz Moran of Earthjustice. “We are jeopardizing the state’s ability to meet our climate goals and we are setting the stage for the rest of the country as a result.”

The former coal plant, in a tourist region known for its glacial lakes and Riesling wines, was converted to natural gas by Greenidge and began producing electricity in 2017. Bitcoin mining at the plant, which has a capacity of 106 megawatts, began in earnest last year. The company said it “took part in the world’s digital future” to New York.

“For decades, this region has been told that it will see new industries and opportunities,” Greenidge said in a prepared statement. “We actually make it happen and do it fully within the state’s national leading high environmental standards.”

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Greenidge said it mined 729 bitcoins in three months, ending Sept. 30. The value of cryptocurrency fluctuates, and on Friday a bitcoin was worth over $ 59,000.

Opponents are frustrated that Greenidge applied to run a power plant but are now operating a mine that takes more of the power.

Greenidge says mining was not part of the plan when the plant came back online and notes that they continue to supply power to the grid. From January to June, Greenidge said it used 58% of its power for mining.

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Supporters see it as an economic blessing in a state of New York that can use the aid. Douglas Paddock, chairman of the Yates County Legislature, testified at a public hearing this week that the facility has brought in 45 high-paying jobs and made a “significant contribution” to the area through tax payments and capital investment.

Some opposition to the plant is about the potential effects of its water abstraction from Seneca Lake. But air quality issues have taken center stage when the State Department of the Environment examines the facility’s permit for air emissions.

Greenidge has said that it complies with its permits and that the plant is 100% carbon neutral thanks to the purchase of carbon offsets, such as forestry programs and projects that capture methane from landfills.

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Opponents claim that the plant undermines the state’s efforts to dramatically reduce greenhouse gas emissions in the coming decades according to its 2019 climate law.

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A large coalition of environmental groups and other organizations asked this week Gov. Kathy Hochul to deny the air condition of Greenidge and to take a similar measure to prevent an existing plant near Buffalo from becoming a mining site. The coalition wants Hochul to create a “national precedent” and impose a state moratorium on the energy-intensive “proof-of-work” cryptocurrency used by bitcoin miners.

Environmental activists estimate that there are 30 facilities in New York that can be converted to mining.

“I really believe more than anything, this facility is an important test of whether the state’s climate law is really worth anything,” said Judith Enck, who served as EPA’s regional Northeastern United States administrator under President Barack Obama.

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Sens. Chuck Schumer and Kirsten Gillibrand have separately asked the federal Environmental Protection Agency to exercise oversight.

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Around the country, there are other power plants used for cryptocurrency mining during various types of events.

In Venango County, Pennsylvania, a generational facility is used that converts coal waste into power to mine bitcoins and can provide electricity to the grid when needed. Stronghold Digital Mining plans to replicate that type of business in two other locations in Pennsylvania.

And in Montana, a coal-fired production station now supplies 100 percent of its energy to Marathon Digital Holdings for bitcoin mining under a power purchase agreement.

“We had previously done what many miners do, that is, you find an industrial building, set it up for mining, and then you contract electricity from the grid,” said Marathon CEO Fred Thiel. “And we wanted to turn that model upside down because we knew there were many underutilized energy production sources in the United States.”

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Thiel said that the harmful emissions are low due to the quality of the carbon and pollution controls, and that the plant would carbon offset at the end of next year. He said his company is focused on moving towards renewable energy and says that cryptocurrency miners can provide crucial financial incentives to build more clean energy projects.

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New York State has not yet decided on Greenidge’s permit.

Greenidge said that even if the plant is running at full capacity, its potential emissions correspond to 0.23 percent of the state’s target for reducing greenhouse gas emissions by 2030.

However, State Environment Commissioner Basil Seggos tweeted last month that “Greenidge has not shown that NY’s climate law is followed” based on goals in that law.

“The state of New York is leading the way in climate change,” Seggos said in a prepared statement, “and we have some major concerns about the role that cryptocurrency mining may play in generating further greenhouse gas emissions.”

© 2021 The Canadian Press


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