How Bitcoin is Heating This Lake and Warming the Planet

Bitcoin is bringing dirty power plants out of retirement. Earthjustice is fighting this new trend in order to put an end to fossil fuels once and for all.

Seneca Lake in upstate New York is drawing attention to Bitcoin's impact on the environment. A nearby Bitcoin mining plant is heating the lake waters -- and the climate.
Seneca Lake in upstate New York is drawing attention to Bitcoin's impact on the environment. A nearby Bitcoin mining plant is heating the lake waters -- and the climate. (Barbara Vallance / Getty Images)

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Bitcoin, the first and most famous cryptocurrency, is now burning through as much energy and pumping out as much greenhouse gas as entire nations.

Current estimates put the currency’s electricity usage on par with countries like the Netherlands. This is, shall we say, not helpful at a time when humanity is racing to switch to clean energy before we cook the planet.

In fact, Bitcoin’s energy demands are so high that the people who get rich from producing it want to pull dirty power plants out of retirement to power their operations. Earthjustice is urging regulators not to let that happen.

Bitcoins aren’t physical coins, so you might be asking why does a virtual currency require much energy?

The appeal of Bitcoin for some people is it allows them to trust no person, bank, or government. Bitcoin is entirely decentralized. But there needs to be some system to prevent fraudsters from making copies of the coins and trying to spend them twice.

To solve this, the system incentivizes many people rather than one trusted entity to devote computing power to validating transactions. The system is competitive, awarding new Bitcoins only to one “miner” who completes the validating and other tasks first, leading to an arms race of ever faster and more powerful computer rigs. While other cryptocurrencies use much less energy, Bitcoin’s particular solution to security without trust, it turns out, is extremely energy-intensive.

Here’s what a modern Bitcoin mining operation in upstate New York looks like:

That monster requires a lot of energy to run the machines and to keep them from overheating. The cooling system for this rig uses cold water from Seneca Lake and discharges it back at temperatures reportedly as high as 98 degrees — with a permit to go even higher — harming trout and promoting algal blooms. For years, Bitcoin miners have sleuthed for places to set up shop where power is cheap and the climate cool, such as China’s Inner Mongolia or the hydro-abundant Pacific Northwest.

But the mining operation pictured above went next level. They own their own damn power plant:

Investors bought this plant in 2014. It was a fixer-upper. Mothballed power plants lying around for sale tend to be dirty fossil fuel plants.

The Greenidge Generation station in New York had been built in the 1930s as a coal-fired power plant. By 2011, there was not enough demand for its costly, dirty power and it was shut down. After not operating for several years, the new owners switched its fuel to dirty gas and re-started its operations, using the plant’s old pollution permits.

The plant struggled to find demand for its electricity, and the operators turned their attention instead to mining Bitcoin. Pollution started to skyrocket. In just one year, emissions of greenhouse gases increased ten-fold. The plant currently uses 19 MW of power, enough to power 14,500 homes if it weren’t mining Bitcoin. And it has plans to go to 55 MW and the capacity to go to 106 MW. At full capacity, the plant would blow past its current pollution permit — but that permit is up for renewal. Earthjustice and coalition partners have submitted comments in opposition to that permit renewal.

Earthjustice and the Sierra Club have also sent an earlier letter to regulators urging them not to allow the company, Greenidge Generation LLC, to expand the air permit and to take notice of the emerging trend of cryptocurrency miners taking over power plants and operating them 24 hours a day, 7 days a week, 365 days a year. At least one other plant in the region is planning to get in on the game, and there are nearly 30 plants in upstate New York alone with the potential to convert to full-time Bitcoin mining. A coal plant in Montana is also ramping back up for cryptocurrency mining.

“The aim of the letter to the New York Department of Conservation is to say this is not some random or isolated thing. Cryptocurrency is real and increasingly important, and dirty power plants are coming back from the dead,” says Earthjustice attorney Mandy DeRoche. “Greenidge just gave other retired, retiring, or peaking plants a roadmap of how to do it, how to recruit investors, how to go public on NASDAQ.”

Earthjustice has spent years fighting in public utility commissions around the country to ensure old, dirty power plants get pushed into retirement — and if replacement power is needed, steer clear of dirty gas in favor of clean energy. Our goal is to hasten the day when everything is powered with 100% clean energy.

New York state has a new climate law, and DeRoche says the commitments made in that law won’t be met if dirty power plants get resurrected and operate 24/7. That should spur legislators and regulators to clarify the regulatory gray zone that miners have exploited here with power generation that’s not sent to the grid.

“There are many ways to tackle this issue, and we are exploring them,” says DeRoche. “One solution may be to require renewable generation for cryptocurrency mining, with an excess renewable generation requirement on top, so that the mining is not preventing renewables from going directly into the grid. We need that clean power on the grid as fast as possible to mitigate the unequal and most harmful impacts of climate change.”

The climate crisis is accelerating, and we have less than a decade to dramatically cut our carbon emissions if we hope to preserve a livable planet. Tell your members of Congress it’s time to build a sustainable and just future with the American Jobs Plan.

Ben serves as the Director of Content Strategy at Earthjustice. He is based in San Francisco.

Earthjustice’s Clean Energy Program uses the power of the law and the strength of partnership to accelerate the transition to 100% clean energy.