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Bitcoin Mining Can Support Renewable Energy Projects: Cornell Study

The use of surplus renewable energy for Bitcoin mining before grid integration could help mitigate climate change and fund the development of renewable energy projects.

A recent study led by Cornell University, “From Mining to Mitigation: How Bitcoin Can Support Renewable Energy Development and Climate Action,” suggests that Bitcoin mining could actually be used to mitigate climate change instead of just damaging the environment through electricity use. The research studied renewable energy projects at the planning stage in the U.S. and calculated each project’s potential profit from Bitcoin mining during the pre-commercial phase. If these projects were to use the electricity generated during this period, before the station has been integrated into the grid, for mining, then the profit could consequently be invested in future renewable energy projects (in an ideal world). 

According to a press release, the researchers concluded that Texas is the state with the highest potential. It was calculated that 32 planned projects could generate a total profit of $47 million by embracing mining activities. Aktina Solar and Roseland Solar Projects were found to be the most beneficial. Other states, including California, Colorado, Nevada and Virginia, also theoretically proved to be profitable but to a lesser extent. 

The researchers also provided recommendations that might help such renewable energy projects develop. One of the suggestions was to provide economic rewards for environmentally responsible cryptocurrency mining, such as carbon credits for avoided emissions.

According to the University of Cambridge, Bitcoin’s share of the world’s total electricity consumption is currently around 0.7%, while its share in total greenhouse gas emissions is about 0.16%. To compare, Malaysia, Sweden and Ukraine each consume less electricity per year than miners.

Another recent study by Alex de Vries showed that Bitcoin’s water footprint is also growing, claiming that a single Bitcoin transaction uses sufficient water to fill a swimming pool due to the necessity to cool mining machines. Politicians and activists have regularly criticized Bitcoin for its energy consumption. At one stage, the IMF requested that the Bitcoin code should be changed to proof-of-stake to cut its carbon footprint.  Greenpeace supported the initiative and even started a special project, saying, “You’ve heard Bitcoin fuels the climate crisis, but did you know a software code change could clean it up?” Back then, the community strongly criticised the idea, claiming that real things benefit from real energy.

This September, a Bloomberg analyst suggested that the concern about Bitcoin's carbon footprint is being overstated and that mining energy consumption is currently more than 50% green. However, some experts have disagreed with his assumptions.

Recently, Bitcoin mining companies have announced several sustainable projects to address the climate challenges ahead. For example, this summer, Tether invested in building "Volcano Energy", a 241 MW renewable energy generation park in El Salvador, which is to power one of the world's largest Bitcoin mining farms. 

Generally, miners can do a lot for sustainable development in an effort to find cheap energy, from stabilising power grids and driving investment in renewables to monetising surplus energy. Thus, Bitcoin could conceivably be considered a catalyst for a better and greener world.