There has been much said about Bitcoin (BTC) and its need for large amounts of energy. In fact, the cryptocurrency industry uses as much energy each year as the entire country of the Netherlands. However, a number of experts in the industry are arguing that crypto could end up being a net positive for the energy sector.
Analyst, and founder of Adamant Capital, Tuur Demeester, has claimed ( in a private Twitter account) that “Bitcoin mining can increase countries’ total electricity production capacity, such that in times of peak domestic demand the market has more spare electricity to divert to households who need it.”
Read more about renewable Bitcoin mining here.
Demeester’s claim wasn’t backed up by much in terms of data however, the analyst predicted that the coin will continue to grow and that as this happens, more power plants will be constructed. The excess energy from these plants will be used for domestic consumption.
Is Bitcoin mining increasing national energy production?
Despite cryptocurrency’s rocky relationship with energy usage, there are some isolated examples of mining plants being connected to domestic energy grids- according to Zach Bradford, the CEO & President of Cleanspark. In a statement he said, “ For example, for a new mining facility we are getting off the ground near Atlanta, Georgia, we partnered with the utility company to invest in new transmission lines — benefitting not just our own facility but everyone who lives along those improved lines.”
According to Bradford, Cleanspark will also be participating in a local program that will allow them to purchase renewable energy credits to offset any fossil fuels in the local energy mix. Funds flowing into this program will be used to increase investment in solar energy production in the local area, which will benefit other consumers of energy in the same area.
Cleanspark is not the only Bitcoin mining company to take on green initiatives. Other firms within the mining industry have refurbished coal-based fossil fuel plants and converted them to natural gas plants. This move may not be entirely environmentally friendly but it does increase overall capacity.
Igor Runets, founder and CEO of BitRiver, explains “Bitcoin mining allows for a faster payback on renewable energy projects such as solar, wind or hydro projects, which means more of them can be built faster in regions where it would not be economically attractive otherwise.”
While generating larger capacity has the potential to benefit energy production, many have noted that this extra capacity is used almost entirely for further cryptocurrency mining, with hardly any energy being distributed elsewhere
However, some mining firms have started to act as direct response units, using their excess energy to help the local community with an on-demand service. According to Bradford, participants in these programs are able to shut down when called upon and send excess energy to other areas, outside of the mining facility. Bradford explained that this mainly occurs during times of natural disaster.
With more and more mining facilities being built each day, could we start to see more domestic applications being powered by cryptocurrency?
