Two members of Congress are asking the Electric Reliability Council of Texas (ERCOT) to address their concerns regarding cryptocurrency mining.
In an Oct. 12 letter, Representative Al Green, (D-Tx) and Senator Elizabeth Warren (D-Mass.) outlined their case of the potential harm cryptocurrency mining could to do to the environment and the costs it could place on consumers.
Cryptocurrency mining uses high speed computers that require enormous amounts of energy to earn, or “mine,” cryptocurrencies such as Bitcoin and Ethereum.
The lawmakers cited data showing the seven large cryptominers indicated that they operate over 1,045 MW of electric production capacity in ERCOT and plan to increase their capacity by at least 2,399 MW in the next few years, a nearly 230 percent increase.
“Industrial-scale miners in Texas, of which there are approximately 10 large-scale facilities that have already connected to the grid, are regularly using over 2 gigawatts (GW) of energy, enough to power all the residences in the city of Houston twice over,” they said. They also noted that in July, “ERCOT stated that over 27 GW of crypto load is projected to be interconnected over the next four years.”
“The energy used to mine Bitcoin and Ethereum in 2021 resulted in almost 80 million tons of carbon dioxide emissions,” the lawmakers said, quoting a ForexSuggest.com report.
In addition, the lawmakers said, during periods of peak demand when the profitability decreases, cryptominers collect subsidies in the form of demand response payments when they shut down operations.
“Cryptominers benefit from huge ERCOT subsidies in the form of demand response agreements that come at the expense of ratepayers and establish ‘misaligned incentives between crypto-asset miners and grid operators,’” the lawmakers said.
“Given the impacts of cryptomining on the climate, the grid, and to ratepayers, ERCOT’s support for this industry is irresponsible and highly concerning,” the lawmakers wrote.
In the letter, Green and Warren asked ERCOT to respond in writing, to answer four questions by Oct. 31.
The lawmakers want to know:
- For the year 2022 to date, and for each of the previous five full calendar years, what has been the annual electricity consumption used for cryptomining in Texas, and how many tons of carbon dioxide emissions have resulted from this energy use?
- How do cryptomining companies plan to scale their operations in Texas, including how much load this will add to the grid in 2023 and in each of the five following years and how ERCOT will handle the increased demand and if it has analyzed the associated costs and whether they would be passed on to consumers and, if so, how that impact on consumers could be mitigated?
- With what cryptomining companies do you have power purchasing and/or curtailment agreements, including specifics of the agreements, such as dates, past payment amounts for curtailments and the timing and rates related to those payments?
- Does ERCOT have any estimates or models regarding the impacts of cryptomining on energy costs to local families and businesses and, if so, what do those models show?