The bitcoin mining industry in Texas was once heralded as a Meccas due to the state’s cheap power and regulatory friendliness. However, the industry is now under scrutiny amid concerns over environmental impacts and escalating energy costs.
Following China’s ban on cryptocurrency mining in 2021, Texas witnessed a significant influx of mining operations, attracted by the state’s advantageous conditions. However, this surge has led to increased examination from both the public and officials regarding its effect on electricity expenses and environmental well-being.
In Granbury, Texas, a local power plant’s bitcoin mining operation has sparked considerable outcry. Continuous noise from the site is causing residents to experience sleep disturbances, migraines and a notable decrease in local wildlife.
“My citizens are suffering from the operation,” Hood County Constable John Shirley said.
Efforts to legislate the industry’s electricity usage faced obstacles last year when a proposed bill aimed at restricting crypto mining during peak energy hours failed to progress through committee.
Correspondence from the Electric Reliability Council of Texas (ERCOT) to the Environmental Protection Agency (EPA) highlighted that the state’s seven largest cryptocurrency mining operations consume more than 1,000 megawatts of power, sufficient to power 830,000 homes.
Ed Hirs, a University of Houston energy expert, discussed with Wired the compounded challenge of Texas’ aging fossil fuel power plants and the additional pressure from large-scale mining operations. He cautioned that such factors are exacerbating grid instability.
Federal lawsuits
In response to a federal request for detailed energy-use data, February saw the Texas Blockchain Council and Riot Platforms initiate legal action against the government, asserting that the inquiry could detrimentally affect businesses. Subsequently, a judge ordered a halt to data collection, with an agreement from the government to discard any information already acquired.
Gov. Greg Abbott has backed the industry as a key to grid reliability, suggesting that miners could utilize renewable energy during low-demand periods to enhance the profitability of wind and solar projects. Conversely, they would power down in exchange for compensation during high-demand times. Critics, however, contend that such operations burden the grid and provide limited advantages, often at the expense of taxpayers.