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January 13, 2023

Environmental Groups File Lawsuit Challenging New York Public Service Commission’s Approval of Fracked Gas-Powered Crypto Mining Operations

Groups cite violation of New York Climate Law’s emissions reduction mandates; Operations could increase planet-heating emissions by 3500%

Contacts

Nydia Gutiérrez, Earthjustice

Albany, N.Y.

Today, Clean Air Coalition of Western New York and Sierra Club, represented by Earthjustice, filed suit with the Supreme Court of Albany County citing violations of New York’s Climate Leadership and Community Protection Act (CLCPA) in the approval of a fossil fuel-burning Proof-of-Work (PoW) cryptocurrency mining operation. The lawsuit challenges the New York Public Service Commission (PSC)’s approval to transfer ownership of the occasionally utilized power plant in Western NY to a 24/7 Crypto mining operation. The lawsuit is the first to demand that a state agency follow the legal obligations established by N.Y. state’s landmark climate law.

On September 15, 2022, the PSC approved the sale of Fortistar North Tonawanda, a 55-megawatt fracked gas power plant located between the Erie Canal and the Niagara River in the City of North Tonawanda, N.Y. to Digihost International, a Canadian cryptocurrency mining company. Over the last five years, Fortistar has only operated between 10 and 74 days per year, emitting relatively small amounts of carbon dioxide (CO2) and other harmful air pollutants. With the approval by the PSC, Digihost will be able to operate 24/7/365, increasing its greenhouse gas emissions up to 3,500% even as the rest of New York works to drastically reduce its greenhouse gas emissions as mandated by N.Y.’s landmark Climate Law, CLCPA.

“The PSC is failing in its role as a regulatory body to protect public health and to uphold the requirements of the Climate Leadership and Community Protection Act. Clean Air will continue to fight against the burning of fossil fuels to generate power for cryptocurrency mining, especially in residential areas like North Tonawanda,” said Chris Murawski, executive director of Clean Air Coalition of Western New York.

While the City of North Tonawanda is surrounded by water and wildlife, it bears the burden of significant pollution. Communities surrounding the gas plant have been designated as draft “disadvantaged communities” under state law, and include census tracts that the state has assessed as bearing an environmental burden greater than that borne by 90% of the state. The increase in operations at Fortistar would also result in higher levels of dangerous local air pollutants that cause asthma, cancer, and premature death, harming an already environmentally overburdened community in violation of the CLCPA.

“Everything changed when New York State enacted its landmark climate law, which requires all its agencies to consider the effects of their decisions on greenhouse gas emissions and the plight of disadvantaged communities,” said Roger Downs, conservation director for the Sierra Club Atlantic Chapter. “The Public Service Commission can no longer ignore the impacts of its decisions, especially when they run counter to public benefit and endanger the air quality for communities already burdened with a disproportionate amount of pollution. Allowing a failing gas fired power plant to be acquired and revived by an energy hungry cryptomine, without considering the environmental impacts, runs counter to the intent of the climate law and the justice it seeks to advance.”

The approval of the crypto mining operation at Fortistar by the PSC follows the NYS Department of Environmental Conservation (DEC)'s decision on June 30, 2022 that denied the Title V Air Permit renewal for Greenidge Generation, a crypto mining facility in the Finger Lakes, citing dramatic increase in greenhouse gas emissions and behind-the-meter operations that do not serve the state’s energy grid. Fortistar has applied for a renewal of its air permit, but the DEC has not yet deemed their application complete.

Additionally, on November 22, 2022, Governor Hochul signed the first-in-the-nation two-year moratoriumon new and renewed permits for fossil-fueled power plants that produce their own energy to mine crypto . The new law requires the DEC perform a full environmental impact assessment on the energy and environmental impacts of crypto mining operations. However, the moratorium did not affect air permit applications that had already been submitted before its enactment.

“New York’s landmark climate law means that agencies can’t ignore the climate and environmental justice consequences of their decisions. We’re calling on the court to hold agencies accountable and ensure that cryptocurrency miners don’t get a free pass to heat our planet and damage our communities,” said Dror Ladin, senior attorney at Earthjustice.

As the controversial crypto industry garners national attention, the White House-Office of Science and Technology Policy released a report detailing the industry's multiple threats, including environmental, and the need for regulation. Similarly, Earthjustice and the Sierra Club released The Energy Bomb: How Proof-of-Work Cryptocurrency Mining Worsens the Climate Crisis and Harms Communities Now, a comprehensive report on the negative environmental impacts of cryptocurrency mining in the United States, including mythbusting that tackles the industry's greenwashing talking points utilized to justify its massive energy use.

Background

Proof-of-work cryptocurrency mining is an energy-intensive process that requires thousands of machines whirring 24/7 to solve complex equations. The more machines that are running, the faster a coin is mined. Each one of these machines requires energy to run, plus more energy for cooling. Globally, proof-of-work crypto mining, like Bitcoin mining, consumes more energy each year than some countries.

Additional Resources

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