Opponents of Greenidge Generation’s Bitcoin mining in Dresden today urged Gov. Kathy Hochul’s administration to deny the facility’s request to renew its air emissions permit and impose a moratorium on the facility. statewide on proof-of-work cryptocurrency mining.
More than a dozen speakers at simultaneous press conferences in Geneva and Albany argued that the rapid growth of Bitcoin mining in New York is jeopardizing the chances of the state meeting the targets set in its law. on the 2019 climate.
Meanwhile, on the deadline day for comments to the State Department of Environmental Conservation on Greenidge’s air permit, hundreds of Finger Lakes companies signed a letter to DEC saying the strong Greenidge’s increased air pollution threatens the region’s wine and tourism industries.
âThe Greenidge facility has nothing to offer the Finger Lakes, but could have devastating effects on our environment and our community,â said Kees Stapel, manager of Boundary Breaks Vineyard in Lodi.
Assembly Member Anna Kelles (D-Ithaca) said she intends to reintroduce a bill to impose a three-year moratorium on proof-of-work cryptocurrency and demand a study environmental impact of two years. A previous version of the bill was passed by the state Senate but stagnated in the assembly.
Proof of Work – Kelles’ target – is the name given to a power-hungry method of verifying cryptocurrency transactions on which Bitcoin, the world’s leading digital currency, is built.
Most new cryptocurrencies try to perfect other verification systems that require much less energy. It’s a promising trend, Kelles said, as an energy-efficient cryptocurrency could help democratize global payments systems.
“But allowing proof-of-work cryptocurrency mining to proliferate and add several hundred megawatts of energy consumption is socially, economically and environmentally irresponsible,” she told the crowd. Geneva press conference.
Greenidge operates at least 15,000 Bitcoin mining computers that draw 44 megawatts of electricity from a recently converted coal-fired power plant that now burns natural gas. Company officials told investors they plan to almost double the energy their Bitcoin mining operation consumes next year.
Because its energy source is natural gas, the Greenidge plant spits out hundreds of tons of greenhouse gases. Its air permit, which expired in September, allows it to emit up to 641,000 tonnes of CO2 equivalent per year.
When it applied for the renewal of this air permit earlier this year, the company asked for the same limit despite its sharply increasing electricity consumption.
The DEC asked the company to explain how it intends to comply with the 2019 law on community leadership and state climate protection, which requires the state to reduce its CO2-e emissions by 40 % by 2030.
Greenidge responded in a letter written by David Murtha of consulting firm ERM. In this letter of August 2, 2021, Murtha acknowledged that Greenidge’s combined CO2-e emissions from the plant itself and leaks from the natural gas wells and pipelines that feed it totaled more than one million. tonnes per year, well above its requested limit.
Weeks later, the DEC commissioner tweeted that Greenidge had failed to demonstrate CLCPA compliance. Instead of ruling on the license renewal application, the DEC has extended the deadline for public comments to this day. The DEC’s final decision on the permit application is pending.
Opponents say they have submitted more than 5,000 comments calling on the Hochul administration to refuse the license renewal.
While Greenidge has garnered the most public attention, there are plenty of other companies looking to get into the lucrative game of proof-of-work bitcoin mining in New York City.
The surge in the price of Bitcoin – $ 57,935 at 3 p.m. today – helped push Greenidge’s crypto revenue from $ 3.0 million in the third quarter of last year to $ 31.2 million in the last year. during the same period this year.
But to compete in the Bitcoin game, new players have to get a large source of very cheap power and spend tens of millions of dollars to buy the latest computers dedicated solely to analyzing Bitcoin transactions (integrated circuits specific to the Bitcoin transaction). ‘application, or ASIC).
Greenidge uses cheap ‘behind the meter’ energy that never reaches the grid. Digihost, a Canadian Bitcoin mining company, hopes to adopt this same model by acquiring a gas-fired power plant in North Tonawanda.
However, other groups see the barriers presented by fossil fuel power plants emitting GHGs and rely on state allocations of renewable hydropower (or mixtures of energy sources dominated by hydropower).
To help fund its Bitcoin computer-buying frenzy, Greenidge went public this year by performing a reverse merger. As a publicly traded company, it can use shareholders’ money to fund massive ASIC orders.
Following Greenidge’s lead, two low-profile companies are planning to go public soon through their own reverse mergers to fund the installation of tens of thousands of crypto-mining machines in New York City.
TeraWulf Inc., which plans to merge next month with Ikonics Corp., has announced to potential shareholders its intention to start a 500-megawatt Bitcoin mining operation in Somerset, a closing coal-fired power plant in Barker on Lake Ontario. , as well as a 300 megawatt Bitcoin mine next to a nuclear power plant about 45 miles southwest of Scranton, Pennsylvania.
TeraWulf said the New York Power Authority allocated 90 megawatts of low-cost electricity (mostly hydropower) to the project in March 2020, “with the potential to expand its energy supply to 410 MW.”
Another Securities and Exchange Commission document suggests that TeraWulf or its affiliates could seek 100 MW of hydroelectric power for Bitcoin mining at a retired coal-fired power plant in Lansing on Cayuga Lake.
Ikonics shareholders are expected to vote on the proposed merger with TeraWulf on December 11.
Meanwhile, Gryphon Digital Mining Inc. plans to merge in Q1 2022 with Sphere 3D Corp.
In a recent slideshow intended for potential investors, Gryphon claims to have “obtained 21 megawatts of electricity for its 7,200 initial machines” at an undisclosed location in upstate New York.
Gryphon said its “best-in-class estimated energy costs” would be as low as 1.3 cents per kilowatt hour, thanks to a New York hydropower allocation. In addition, he says his hosting deal with Core Scientific provides an additional 230 MW of cheap hydropower and that he intends to expand his energy sources to nuclear and solar over time.
The company’s slideshow says it has “options to acquire up to 220,000 advanced miners (ASICs).”
Greenidge also has big plans.
In October, it announced that it had doubled its order for mining machinery to 22,500. It also said it was negotiating potential deals in Texas that could provide up to 2,000 MW of low-cost power for mining. of Bitcoin.
And the company said it has signed an agreement to acquire a 175-acre site in South Carolina for a largely nuclear-powered Bitcoin mining operation.
Despite their major ambitions for Bitcoin operations in New York, TeraWulf and Gryphon did not attend a recent State Assembly hearing on cryptocurrency. Dozens of speakers testified for more than five hours last month.
But in other places, TeraWulf and Gryphon officials have highlighted their reliance on renewables rather than fossil fuels that emit greenhouse gases. Paul Prager, CEO of TeraWulf, also argued that using hydropower for Bitcoin mining tends to stabilize the grid.
But two Cornell University professors disagree.
“Our New York hydropower offers a great advantage for a stable grid, as it can be produced more or less on demand,” said Robert Howarth in a recent email from Glasgow, Scotland. “Using this hydro for Bitcoin instead would appear to increase instability.”
Howarth, a biochemist, also cited the âopportunity costâ of using hydropower for Bitcoin mining. “If cryptocurrency absorbs renewable electricity, it is less available to replace fossil fuel electricity and more expensive for other customers, which could slow the CLCPA-mandated transition (to renewables). . ” Cornell economics professor Eswar Prasad agreed. “We can use these renewable energy sources for more constructive social purposes,” he said during testimony at the assembly hearing last month.
Prasad also said that mining cryptocurrencies produces relatively few jobs. âThe reality is that ASICs don’t go out and stay in hotels or eat in restaurants.
âIn terms ofâ¦. Mining that supports proof-of-work-based cryptocurrencies, I see many detrimental consequences for New Yorkâ¦ and very little economic benefit.