Following a new White House report on the climate implications of energy-intensive cryptocurrency mining, research from Cornell Engineering suggests that providing green policy incentives for carbon capture and renewable energy should help these mining operations to reduce their carbon footprint.
The Cornell study, “Bitcoin mining with carbon capture and renewable energy for carbon neutrality in all states of the United Stateswas published September 14 in Energy & Environmental Science.
The carbon impact of cryptocurrency is coming under increasing energy scrutiny and was discussed in a White House report,”Climate and energy implications of crypto-assets in the United Statespublished September 8 by the White House Office of Science and Technology Policy. This report is the result of President Joe Biden’s decision Executive Order 14067 (March 2022) – “Ensuring responsible development of digital assets”.
“Bitcoin Mining’s energy hunger and associated problematic carbon emissions have caused concern around the world,” the lead author said. fengqi youProfessor Roxanne E. and Michael J. Zak in Energy Systems Engineering.
“Whether we like it or not, there is a market. The crypto is here,” said You, principal researcher at Cornell Atkinson Center for Sustainability. “As the cryptocurrency market is growing, how can we better use science to inform energy and climate policy? How can we encourage industry to practice environmental, social and governance type management and to manage its mining operation in a more sustainable way is the key.
Validating crypto-asset transactions – done through consensus mechanisms such as “proof of work,” used by Bitcoin and Ethereum blockchains – requires huge amounts of electricity. Total global electricity consumption for cryptocurrency mining assets is between 120 billion and 240 billion kilowatt hours per year – a range that exceeds the total annual electricity consumption of major countries, such as Australia and the United States. Argentina, according to the White House report.
The Cornell study shows that states with a high share of renewable energy in the power grid and lower electricity prices could mitigate the environmental damage caused by cryptocurrency.
In the United States, if federal and state policies balance economic development, strengthen environmental protections, and provide incentives for direct carbon capture from the air and environmentally responsible mining, then cryptocurrency is becoming more sustainable.
“Cryptocurrency mining is like mining precious metals,” he said. “The deeper you go underground, the more difficult it is to extract. For cryptocurrency, it takes longer to validate now than before.
In a techno-economic environmental analysis contained in the document, the Cornell Group examined all 50 states on the feasibility of cryptocurrency mining operations. Among states with crypto-mining operations, Vermont, Maine, Washington, Idaho and New Hampshire emitted the least carbon dioxide, while Delaware, West Virginia, Rhode Island and Kentucky produced the most.
Economically, Hawaii, Rhode Island, Alaska, Connecticut, West Virginia and Kentucky had the worst performance, while Washington was the most profitable state, followed by Vermont (with almost all of the green energy) and New York (which has a lot of hydroelectricity and is moving towards all-green energy).
“The study finds that states with lower electricity prices generally have higher penetration of renewables into the power grid,” You said. “If you run a cryptocurrency mining operation and choose a location with a lower electricity price, it is likely to use cleaner electricity to mine bitcoin.
“Greener technology is coming,” he said. “We are developing renewable energy systems to support the sustainable development of this industry, promote the economy and support climate actions.”
In addition to You, the first author is Haider Niaz, visiting graduate researcher at the Process-Energy-Environment Systems Engineering Laboratory (PEESE) at Cornell. The National Science Foundation helped fund this research.