I believe this viewpoint is an attempt at greenwashing for crypto. Yes, renewable energy overproduction is a technical problem for grid operators. But crypto mining is just one potential task that...
I believe this viewpoint is an attempt at greenwashing for crypto. Yes, renewable energy overproduction is a technical problem for grid operators. But crypto mining is just one potential task that can be done when there is surplus demand. Crypto doesn’t stop when the sun goes down; people are still going to be mining and using fossil fuels to do so.
As far as I am concerned, every other answer to the renewable overproduction problem except for storage is a bad deal. They basically mean putting massive discounts on that power for private use. In the other hand, storage represents an investment that means that everyone on the grid benefits, both in terms of equitable distribution and environmental impact; each unit of stored energy used represents a unit of power we do not need to extract from fossil fuels.
The article states that 76% of crypto miners have renewables in their energy mix. That is terrifyingly low. If you are using power from the grid just about anywhere in the United States (and most European nations to my knowledge), you are automatically using renewables. Here in Southern California, it’s around 31%, and you can opt into a “green rate” in which either 50% or 100% of your bill is used to fund solar installations. They have actually had to waitlist the program because they have saturated their construction ability.
That being said, energy storage facilities are largely not here right now, and energy demand induced crypto mining is an easy solution that exists right this very moment. So it would be uncharitable to say that they are completely useless right now. But it’s important to realize it as a stopgap rather than try to make it a feature of our energy production cycle.
I'm torn because to a certain extent this is a legitimate solution to overproduction. However, it feels like it's a short term solution ill prepared to meet long-term grid needs. I fail to see how...
I'm torn because to a certain extent this is a legitimate solution to overproduction. However, it feels like it's a short term solution ill prepared to meet long-term grid needs. I fail to see how consuming excess generation through mining is better than pursing energy storage/arbitrage solutions.
Why waste the electrons on crypto when they can be stored and used once that overproduction period passes? This ensures more of the grid demand can be met with renewables which is the goal after all. And even if the grid demand isn't there yet (so storage doesn't make sense yet) the demand certainly will be a few years down the road. So why build out infrastructure that's going to just create a new problem later rather than build out infrastructure to add better capacity capability through storage solutions? I understand the economics of storage aren't often there in the current market, but long term it looks like they're moving that direction. I'm not sure Crypto has the same long term horizon of benefit for grid stability.
Edit: double checked the publication date to make sure I didn't take the bait for an April fools gag. But no, published a few days ago. :/
I’m not sure we need to worry about the long term. There’s competition that makes Bitcoin rigs become obsolete fairly quickly. When electricity demand rises through increased storage, more power...
I’m not sure we need to worry about the long term. There’s competition that makes Bitcoin rigs become obsolete fairly quickly. When electricity demand rises through increased storage, more power lines, or other means, the bitcoin miners will move somewhere else that’s cheaper. Perhaps the data centers get converted to something else like AI?
It might also reduce the incentive to build those new power lines, though, by reducing price differences? Hard to say.
You make a great point. I think my short term concern would be to see utilities incentivize this to companies/miners and end up with agreements that come back to haunt the collective grid as the...
You make a great point. I think my short term concern would be to see utilities incentivize this to companies/miners and end up with agreements that come back to haunt the collective grid as the need for more storage increases. Because consuming power just to match overproduction still seems like a waste rather than find ways to store it for use later (such as incentivizing buildings to integrate chilled or hot thermal storage that charges during low rates/oversupply or even just to add behind the meter battery capacity). Incentivizing those types of investments is going to contribute better to the grid long term than just consuming excess supplying the short.
I was hoping to read some reporting on what’s going on now, but it’s just an opinion piece, darn! Some previous discussions: Texas paid bitcoin miner more than $31 million to cut energy usage...
I was hoping to read some reporting on what’s going on now, but it’s just an opinion piece, darn! Some previous discussions:
One of the key aspects of the power grid is that it must supply exactly the amount of power demanded at any given time. When power grids were first established, they were designed with coal and big spinning turbines in mind. As a result, the mechanisms keeping the entire system stable relied on the same technology.
But increasing integration of increasing levels of volatile renewables is impacting both the stability of the grid and how balancing services are provided. Today, there are three main solutions: peaker plants; demand response; and energy storage.
The advantages of crypto mines in demand response revolves around their high degree of flexibility. Industrial plants can also reduce their power consumption, but not as easily because of the disruption to physical processes.
But the disadvantage of crypto mines is they generate nothing of value and are solely a means of making the world a worse place by consuming resources. We shouldn't be encouraging this, and should...
The advantages of crypto mines...
But the disadvantage of crypto mines is they generate nothing of value and are solely a means of making the world a worse place by consuming resources. We shouldn't be encouraging this, and should really just be regulating any form of proof-of-work crypto out of existence.
I believe this viewpoint is an attempt at greenwashing for crypto. Yes, renewable energy overproduction is a technical problem for grid operators. But crypto mining is just one potential task that can be done when there is surplus demand. Crypto doesn’t stop when the sun goes down; people are still going to be mining and using fossil fuels to do so.
As far as I am concerned, every other answer to the renewable overproduction problem except for storage is a bad deal. They basically mean putting massive discounts on that power for private use. In the other hand, storage represents an investment that means that everyone on the grid benefits, both in terms of equitable distribution and environmental impact; each unit of stored energy used represents a unit of power we do not need to extract from fossil fuels.
The article states that 76% of crypto miners have renewables in their energy mix. That is terrifyingly low. If you are using power from the grid just about anywhere in the United States (and most European nations to my knowledge), you are automatically using renewables. Here in Southern California, it’s around 31%, and you can opt into a “green rate” in which either 50% or 100% of your bill is used to fund solar installations. They have actually had to waitlist the program because they have saturated their construction ability.
That being said, energy storage facilities are largely not here right now, and energy demand induced crypto mining is an easy solution that exists right this very moment. So it would be uncharitable to say that they are completely useless right now. But it’s important to realize it as a stopgap rather than try to make it a feature of our energy production cycle.
I'm torn because to a certain extent this is a legitimate solution to overproduction. However, it feels like it's a short term solution ill prepared to meet long-term grid needs. I fail to see how consuming excess generation through mining is better than pursing energy storage/arbitrage solutions.
Why waste the electrons on crypto when they can be stored and used once that overproduction period passes? This ensures more of the grid demand can be met with renewables which is the goal after all. And even if the grid demand isn't there yet (so storage doesn't make sense yet) the demand certainly will be a few years down the road. So why build out infrastructure that's going to just create a new problem later rather than build out infrastructure to add better capacity capability through storage solutions? I understand the economics of storage aren't often there in the current market, but long term it looks like they're moving that direction. I'm not sure Crypto has the same long term horizon of benefit for grid stability.
Edit: double checked the publication date to make sure I didn't take the bait for an April fools gag. But no, published a few days ago. :/
I’m not sure we need to worry about the long term. There’s competition that makes Bitcoin rigs become obsolete fairly quickly. When electricity demand rises through increased storage, more power lines, or other means, the bitcoin miners will move somewhere else that’s cheaper. Perhaps the data centers get converted to something else like AI?
It might also reduce the incentive to build those new power lines, though, by reducing price differences? Hard to say.
You make a great point. I think my short term concern would be to see utilities incentivize this to companies/miners and end up with agreements that come back to haunt the collective grid as the need for more storage increases. Because consuming power just to match overproduction still seems like a waste rather than find ways to store it for use later (such as incentivizing buildings to integrate chilled or hot thermal storage that charges during low rates/oversupply or even just to add behind the meter battery capacity). Incentivizing those types of investments is going to contribute better to the grid long term than just consuming excess supplying the short.
I was hoping to read some reporting on what’s going on now, but it’s just an opinion piece, darn! Some previous discussions:
Texas paid bitcoin miner more than $31 million to cut energy usage during heat wave (2023)
These 23-year-old Texans made $4 million last year mining bitcoin off flare gas from oil drilling (2022)
But the disadvantage of crypto mines is they generate nothing of value and are solely a means of making the world a worse place by consuming resources. We shouldn't be encouraging this, and should really just be regulating any form of proof-of-work crypto out of existence.