Earthjustice Would Welcome Biden Admin Assessment of Cryptocurrency Mining's Climate and Energy Impacts

WASHINGTON, D.C. (02/17/2023) (readMedia)-- Late yesterday afternoon, Axios reported that the Biden administration may be moving forward with an effort to assess cryptocurrency mining's climate impacts, and a U.S. Department of Energy spokesperson confirmed that in the coming months it will be outlining its efforts to evaluate crypto's energy intensity.

Mandy DeRoche, Deputy Managing Attorney of the Clean Energy Program at Earthjustice, issued the following statement in response:

"The cryptocurrency mining industry is nebulous and opaque, currently with very little regulation or reporting standards. That makes it difficult to track and get a complete picture of its full impact. So the possibility of a DOE effort to do this would be a positive step for the climate, and for the people who live near fossil fuel-guzzling cryptocurrency mines and have to live with increased air, noise, and water pollution due to this sorely underregulated industry. We hope this development is a turning point and leads to better regulation of this extremely energy-intensive industry. In the meantime, Earthjustice will continue fighting for the communities who host dirty mining operations before the courts and regulators across this country."

In December 2022, Earthjustice and Sierra Club, in partnership with 18 organizations, submitted comments to the Department of Energy and Energy Information Administration about the negative climate and environmental impacts of cryptocurrency mining. The organizations asked that the agencies collect more data about cryptocurrency's energy consumption. Read the comments attached.

In September 2022, the White House sounded the alarm about cryptocurrency mining - the Office of Science and Technology Policy released a report about the industry's climate threats and the need for regulation. But cryptocurrency mining continues to grow rapidly across the country. Earthjustice and the Sierra Club released a Guidebook, finding that in one year from mid-2021 to mid-2022, Bitcoin mining in the U.S. alone consumed as much electricity as four states combined, emitting 27.4 million tons of CO2 - equivalent to the emissions of as much as 6 million cars annually. More highlights from the Guidebook:

• Proof-of-work cryptocurrency mining has grown explosively in the United States since 2020. Today, an estimated 38% of Bitcoin is mined in the U.S, resulting in nearly 30 million tons of excess CO2 emissions in the last year alone.
• From mid-2021 to mid-2022, Bitcoin consumed 36 billion kilowatt-hours of electricity - as much as all of the electricity consumed in Maine, New Hampshire, Vermont, and Rhode Island put together in that same time period.
• The massive energy consumption of cryptocurrency mining threatens to undermine decades of progress toward achieving climate goals and reducing local pollution. In addition, cryptocurrency mining practices raise costs and risks for utilities and their ratepayers, can stress electric grids, and flood communities with noise.
• The cryptocurrency mining industry already uses half the electricity of the entire global banking sector, and it will overtake the sector in two years if current trends continue. Meanwhile, the ratio of Bitcoin's energy consumption to humans who actually have Bitcoin is extremely high.
• Rather than investing in long-term energy infrastructure that benefits the grid, the cryptocurrency mining industry seeks the fastest energy that can serve its needs, and looks for minimal regulation and oversight. In practice, that translates to mining cryptocurrency at coal and gas plants, straining the electric grid in Texas, and tapping into power grids that are often fossil-fuel heavy.
• Most mining facilities draw their power from the grid. That means electricity is generated by whatever existing energy is in place in the region. No grid anywhere in the U.S. is 100% renewable yet.
• Proponents also claim that mining is spurring new renewable development and stabilizing the grid. But clean energy allocated to cryptocurrency mining doesn't actually do anything to decarbonize the grid, and there are few mining facilities that are building renewables to even power their own operations, let alone send to the grid.
• Cryptocurrency mining proponents claim that mining only uses "wasted" energy from solar or wind overproduction. But mining operations consume energy 24 hours a day, not just when there is excess solar or wind - meaning mining operations would fail to be profitable using only the hours when wasted energy is available

Read the guidebook here.

Background

In its recent report, the Intergovernmental Panel on Climate Change (IPCC) warned that global warming will reach dangerous levels if we don't drastically reduce our dependence on fossil fuels much faster than we are. But after China banned proof-of-work cryptomining (the process Bitcoin uses), citing, among other things, the environmental threats that mining poses to meeting emissions reduction goals, the U.S. is now hosting many energy-intensive proof-of-work cryptomining operations. While these facilities of automated machines create few new jobs, they threaten the climate, in addition to small businesses, local economies, and natural resources.

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 to for cooling. Globally, Bitcoin mining consumes more energy each year than entire countries. In the U.S. alone, Bitcoin mining produces an estimated 40 billion pounds of carbon emissions each year. Fossil-fueled mining facilities can also be major emitters of air pollutants.

About Earthjustice

Earthjustice is the premier nonprofit environmental law organization. We wield the power of law and the strength of partnership to protect people's health, to preserve magnificent places and wildlife, to advance clean energy, and to combat climate change. We are here because the earth needs a good lawyer.