NYS Says "We follow the Science," Experts Ask: "What About Cryptomining?"

ALBANY, NY (04/13/2022) (readMedia)-- Today, a group of scientists including NYS Climate Action Council member and Cornell University professor Robert Howarth, Cornell environmental engineering professor Anthony Ingraffea, State Senator Rachel May, PhD, and economist and former Mayor of Plattsburgh Colin Read urged Governor Hochul to "follow the science" and put a moratorium on proof-of-work cryptomining. The group also called on Governor Hochul and the DEC to deny the air permit renewal application for Greenidge Generation, a converted peaker plant operating as a 24/7 Bitcoin mine under grandfathered-in permits in the Finger Lakes. On March 31, the DEC punted the deadline to renew or deny Greenidge Generation's Title V Air Permit to June 30 – two days after the gubernatorial primary. This is the second time DEC has delayed making a decision, after a previous two-month delay and more than a year of advocacy by residents, business owners, scientists, wine makers, environmental activists, and elected officials.

Watch the Zoom presser here.

Greenidge Generation is the test case for proof-of-work cryptomining in New York. Located on the shores of Seneca Lake, Greenidge is a once-mothballed power plant that has been converted into a bitcoin mine by the private equity firm that owns it. The plant has brought only 48 new jobs to the region compared to the existing $3 billion agritourism economy, employing approximately 60,000 people, while poisoning the Finger Lakes' natural resources. Greenidge operates over 17,000 Bitcoin mining machines and is expanding to over 32,500, pumping dirty fossil fuels into the air 24/7. This will lead to over 1 million tons of CO2 emissions each year, equal to that of 100,000 homes. Greenidge also sucks up to 139 million gallons of water each day from Seneca Lake and dumps it back in at up to 108 degrees. Gregory Boyer, director of SUNY's Great Lakes Research Consortium, has warned about Greenidge's potential to cause harmful algal blooms, which can be dangerous or fatal to humans and other animals in Seneca Lake, and make this water source for 100,000 people non-potable.

In its recent report, the Intergovernmental Panel on Climate Change (IPCC) warned that global warming is nearing dangerous levels if we don't drastically reduce our dependence on fossil fuels much faster than we are. Meanwhile, New York State is accommodating 20% of the country's rapidly-growing, fossil fuel-burning cryptomining industry, a direct threat to communities, local economies, and the climate. The science is clear, yet Governor Hochul is allowing cryptomining to wreak havoc on New York unchecked and unregulated. Continued cryptomining will make it impossible for New York State to meet the critical zero-emissions climate goals outlined in the Climate Leadership and Community Protection Act.

"Within the framework of New York State's strong climate laws, it is hard to understand the rationale for DEC's latest delay on the air emissions permit renewal decision for Greenidge's cryptocurrency mining operations. If we are serious about protecting our air and water resources and committed to combating climate change, we must ensure the operations of this energy-intensive industry comply with the goals of the Climate Law and result in reductions in greenhouse gas emissions; anything less than that is unacceptable. In the absence of a timely decision by the agency, the Legislature must act in this session to impose a moratorium on proof-of-work cryptomining," said Senator Rachel May (D-Onondaga, Madison, Oneida)

"According to state scientists from NYSERDA, we need to invest a minimum of $10 billion per year to meet our climate goals by 2030. We also know that if we do not meet this goal it will cost the state $27 billion each year due to the negative impacts of climate change. According to the United Nations, we must reduce our total global GHG emissions by 50% by 2030 to avoid the worst effects of climate change. The science is clear that now is the time for action. Proof-of-work cryptomining will lead to an increase on our grid that we simply cannot afford and which is in direct competition with our environmental efforts to convert our buildings and transportation to electric. PoW cryptomining is already slated to increase our total state energy usage by 1.5 gigawatts, which would power 750,000 homes. At a time when we must focus our efforts on rapidly reducing our energy usage and GHG emissions, this industry is sending us in the wrong direction," said Assembly Member Anna Kelles.

"Giving Greenidge five months of an emissions extended pass is unacceptable. During most of that time they will be emitting greenhouse gases at above CLCPA-controlled levels. Greenidge cannot be permitted to continue to ramp up emissions with a vague promise of doing better in the far future. Four years from today is a crucial period in our fight against climate change, and we cannot waste these years on promises from a company that was deceptive in its intentions from the start," said Anthony R. Ingraffea, Ph.D., P.E., Dwight C. Baum Professor of Engineering Emeritus and Weiss Presidential Teaching Fellow, Cornell University.

"Studies now show that the benefits of Bitcoin are minor but the costs are formidable. These costs arise from the subsidies power authorities provide to miners at ratepayers' expense, in addition to our increased reliance on fossil fuels and peaker power plants, the environmental damage from a continued reliance on fossil fuels, and even the cost to Bitcoin holders themselves as more coin minted every hour dilutes their savings. These costs dwarf the profits miners generate for themselves, which calls into question the entire Proof of Work sector," said Colin Read, Professor of Economics & Finance, SUNY Plattsburgh; Former Mayor of Plattsburgh, NY.

The DEC has already confirmed that Greenidge is a threat to New York's energy goals as outlined in the CLCPA. In a recent story published in the Albany Times Union, the Department of Environmental Conservation cast doubts about continuing operations:

"Greenidge 'has not demonstrated that the project is consistent with the attainment of statewide greenhouse gas emission limits established in the Climate Act.' The agency said that Greenidge has not yet shown how the operation would not hinder the goals of reducing greenhouse gas emissions."

And at a recent Environmental Conservation budget hearing when asked about the potential impact of the escalating cryptocurrency mining activity in upstate NY on the states energy grid, the NYS Energy Research and Development Authority (NYSERDA) President Doreen Harris stated, "There could be a very significant impact on NY load resulting from cryptocurrency mining depending on the penetration of the resource."

After China banned cryptomining, citing the environmental threats the practice poses to meeting emissions reduction goals, outside speculators have flocked to upstate New York to take advantage of the nonexistent environmental regulations. Greenidge is just the beginning, and advocates fear that its operations signal to even more outside speculators that New York's closed and underutilized fossil fuel-burning plants are available to be bought up and re-open as gas guzzling Bitcoin mining cancers on communities. Advocates, scientists, electeds, and more are urging Governor Hochul to put a moratorium on proof-of-work cryptomining.

The Governor is well within her legal authority to act, according to a new white paper from Columbia Law School Sabin Center for Climate Change Law: A Pause on Proof-Of-Work: The New York State Executive Branch's Authority to Enact a Moratorium on the Permitting of Consolidated Proof of Work Cryptocurrency Mining Facilities. The paper (summary of findings available here) draws on precedent established in 2010 when the executive branch signed the fracking moratorium. It finds the Governor has authority to stop new proof-of-work cryptomining operations by enacting a moratorium on the permitting of these facilities until a Generic Environmental Impact Statement (GEIS) to determine the full extent of the impacts of mining on communities is complete.

Background

Proof-of-work cryptocurrency mining (which Bitcoin uses) is an extremely 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 run cooling technology. Globally, proof-of-work Bitcoin mining uses the same amount of energy each year as the entire country of Argentina. It produces 30,700 metric tons of e-waste each year, comparable to the yearly IT equipment waste of the Netherlands. If left unregulated, the industry will wreak irrevocable harm on the entire state of New York, making it impossible to reach New York's crucial climate goals as outlined in the Climate Leadership and Community Protection Act (CLCPA). The CLCPA commits to an 85% reduction in greenhouse gases by 2050 and 100% zero-emission electricity by 2040.

These facilities are also major emitters of methane and toxic air pollutants including benzene, formaldehyde and polycyclic aromatic hydrocarbons (PAHs), which are precursors of ground level ozone pollution and known causes of asthma, heart attacks, strokes, reproductive damage and preterm birth.

Powering Bitcoin mining with renewables is not a viable solution, as renewables supply cannot possibly meet the extreme energy demands of Bitcoin mining in addition to daily necessities such as heating and cooling homes and running cars. Any renewable energy that supports Bitcoin mining is renewable energy that is being diverted from the public grid. And when crypto miners rely on the public grid, they stick everyday New Yorkers with the bill. A 2021 study estimates "the power demands of cryptocurrency mining operations in upstate New York push up annual electric bills by about $165 million for small businesses and $79 million for individuals.

Cryptomining is also at odds with the overwhelmingly popular amendment to the state constitution passed last year, which guarantees every New Yorker the right to clean air, clean water, and a healthful environment. Revitalizing old polluting power plants for private financial gain, with drastic consequences for our air, water and climate, all while causing huge amounts of noise pollution, is now unconstitutional - and ought to be treated as such.

Reform groups Common Cause/NY and NYPIRG have specifically criticized the crypto mining industry for exploiting public resources and straining the energy grid for private gain, and a group of federal lawmakers led by Senator Elizabeth Warren requested details from six major Bitcoin mining companies about their electricity usage and contributions to climate change. Earlier this month, President Biden issued an executive order requiring federal agencies study the legal, economic, and environmental impacts of cryptocurrencies, including Bitcoin mining. Even the Mayor of New York City, Eric Adams, an avid crypto booster has come out against mining, declaring at a February 9th joint session of the Legislature: "I support cryptocurrency, not crypto mining."

More than 1,000 organizations, businesses, environmental activists, concerned residents, wine makers, elected officials, and more have taken action over the last year in opposition to crypto mining in New York State. A letter sent to Governor Hochul in October was signed by more than 650 individuals and groups. In letters to Governor Cuomo last year opposing Greenidge Generation's expansion from an emergency peaker plant to a 24/7 Bitcoin mining operation, organizations, businesses, and Finger Lakes residents demanded Gov. Cuomo revoke Greenidge's permits due to its massive greenhouse gas emissions, poisoning of the Finger Lakes, and noise pollution, with no economic benefit to the community. Greenidge Generation is still operating in Dresden, NY under grandfathered-in permits granted for use as a peaker plant, not 24/7 Bitcoin mining. Greenidge has applied for an air permit renewal and is awaiting a decision from the Department of Environmental Conservation. Similar fights have occurred in Plattsburgh and Niagara Falls, which resulted in local moratoriums.

Legislation (A7389B/S6486C) to place a 3 year moratorium on Bitcoin mining in New York State is picking up steam in the Assembly with 41 co-sponsors including 15 senior-ranking Assembly committee chairs as of February 24.

About Seneca Lake Guardian

Seneca Lake Guardian is a New York State Not-for-Profit Corporation with 501(c)(3) and is dedicated to preserving and protecting the health of the Finger Lakes, its residents and visitors, its rural community character, and its agricultural and tourist related businesses through public education, citizen participation, engagement with decision makers, and networking with like-minded organizations.