New York reopens crypto mining sites Environment and profit at war

The emerging industry of bitcoin mining has been met with strong resistance from environmentalists as it continues to tap into digital wealth.

Greenidge Generation, a coal-fired power plant founded in 1937, is now turning to cleaner natural gas energy to mine bitcoins. It argues that it is complying with all of New York’s environmental regulations. Environmentalists, however, disagree, arguing that Greenidge is not only harming the planet, but will also contribute to the deterioration of New York’s climate. Despite the fact that Greenidge can only mine 4 bitcoins per day, it has become a thorn in the side of energy efficiency advocates.

New York reopens crypto mining sites Environment and profit at war

Greenidge Generation describes itself as a 24/7 bitcoin mining facility that uses natural gas to generate electricity. According to the U.S. Energy Information Administration, natural gas emits about 117 pounds of carbon dioxide per million British thermal units (MMBtu), which is more than 40 percent lower than coal’s 200 MMBtu. Although natural gas is more environmentally friendly than coal energy, the carbon impact of natural gas still far exceeds that of renewable energy sources such as solar and wind.

Mandy DeRoche, an attorney representing Earth Justice, told Decrypt “It’s simply not environmentally friendly. I don’t think restarting a once-shuttered power plant and burning natural gas 24/7, except for a few days in the summer and winter, is consistent with any local greenhouse gas reduction goals.”

Earlier this month, New York Senator Kevin Parker (D) introduced a bill to the Environmental Protection Committee that, if passed, would allow bitcoin mining centers to operate only after a full environmental review, a process that could take up to three years. The bill states that “the ongoing mining of cryptocurrencies has significantly increased energy use in New York State,” while the carbon dioxide emissions from such mining could even push the entire state beyond greenhouse gas emissions regulations. The bill not only targets Greenidge, but also threatens the state’s burgeoning bitcoin mining hubs. The bill also has the potential to serve as a model for other states and countries to curb crypto operations.

New York reopens crypto mining sites Environment and profit at war

Greenidge opposes the measure and says it has been permitted to operate its facility in Dresden, N.Y. Greenidge obtained its Title V permit in 2016 and hopes to renew it in September of this year. On March 25, Greenidge submitted the various documents to the New York Department of Environmental Conservation to renew its Title V. Dresden emits about 640,000 tons of carbon dioxide equivalent per year. According to Environmental Protection Agency carbon emissions calculations, 640,000 tons of CO2 emissions are equivalent to burning 708 million pounds of coal, using electricity in 16,000 homes or driving 160 million miles in a year. The environmental impact of Greenidge can also be reversed based on Bitcoin’s overall carbon emissions record. When extrapolated to Greenidge’s highest annual CO2 emissions, bitcoin miners generate 1% of the total carbon emissions ratio.

In addition to environmental concerns, DeRoche also told Decrypt that Greenidge’s emissions may not be regulated. “Usually commercial permits are renewed normally, but with a plant like Greenidge, the business behind it is actually unattended.” DeRoche and Earth Justice jointly wrote to New York environmental regulators to warn that restarting power plants like Greenidge could be part of a plan to grow bitcoin mining operations down the road. Blockchain company Digihose Technology is planning to develop the Fortistar North Tonawanda power plant for bitcoin mining operations. DeRoche added, “If plants like Greenidge are not resisted, it could significantly impact carbon emissions targets later on, and these plants are not being abandoned for no reason.”

Dale Irwin, CEO of Greenidge Generation, countered some of the criticism of the company in a conversation with Decrypt, Irwin said that Greenidge’s restart is not just about bitcoin mining. Back in 2019, however, Greenidge conducted a pilot project on bitcoin mining. But Iriwin said Greenidge’s relaunch has also stimulated the New York economy, “We have 35 employees now and will expand to 40 to 50 in the future, and our average salary is twice the community level.”

According to economic analysis data from the 2020 Census on Town Charts, the average wage in Dresden is at $38,214 per year. Iriwin plans not to continue using natural gas in the future either, and will respond positively to the policy that 70 percent of New York’s electricity will come from renewable sources by 2030.

Greenidge’s mining facility can mine 3.8-4 bitcoins per day, which means it makes about $150,000 per day, a significant increase from $50,000 in March 2020. iriwin believes that the company is not only serving the surrounding area, but is contributing to the lifeblood of the bitcoin economy around the world. These statements clearly don’t impress environmentalists like DeRoche, who believes Greenidge is touting unrealistic benefits to cover up the environmental pollution caused.

Right now, the dispute over the benefits of bitcoin mining and environmental protection is intensifying, and government officials are splitting hairs. New York Governor Andrew Cuomo tweeted that he had ignored climate change and that his failure to sign an environmental bill in a timely manner was a gross oversight on his part. The International Brotherhood of Electrical Workers (IBEW), however, argues that signing an environmental bill to stop the huge profits is a big mistake.

New York reopens crypto mining sites Environment and profit at war

In the U.S., the bitcoin mining business has been continuing to grow, from 4 percent in September 2019 to nearly 8 percent of the global share today, and Irwin says the bitcoin mining business is here to stay for the long haul, and will grow better and more robustly in New York than in China, where mining operations are not environmentally friendly and do not have clear regulations. “It’s better to grow in a place that has a known well-established environmental regulation than to grow in a place that doesn’t anticipate emissions and doesn’t have clear regulations.”

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