How Does Bitcoin Mining Influence The Energy Sector? Newshuntz

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How does Bitcoin mining influence the energy sector: Although Bitcoin (BTC) is known for its high energy consumption, it could well become a key player in the evolution of the energy industry. 

Its ability to monetize excess energy generated by power plants could well be the catalyst needed to propel this industry toward a more sustainable future. 

In this article, we explore how Bitcoin (BTC) mining can transform the energy industry, contributing to a more efficient and environmentally friendly economy.

Does Bitcoin pollute as much as you might think?

One of the main arguments of Bitcoin’s detractors is its energy consumption and in particular, the pollution that it would generate. You have probably heard that the Bitcoin network consumes more than some countries and that it could even kill our planet.

However, these accusations are based on poor analyses of what Bitcoin is, how it works, and what energy it uses.

According to calculations by the University of Cambridge, Bitcoin mining consumes approximately 116.61 TWh per year, or 0.07% of global energy consumption and almost as much as the energy consumption of Argentina. But is it even comparable?

Read also: How to Sell Bitcoin (BTC) in 2024?

Bitcoin is not a country, but a monetary exchange network. It would be fairer to compare it to the global banking system which consumes around 5,000 TWh, or 42 times more than the Bitcoin network.

The main goal of Bitcoin miners is to find a cheap and abundant source of energyIt turns out that this energy source comes mainly from renewable resources, emitting no greenhouse gases.

Currently, around 50% of the energy consumed by the Bitcoin network comes from renewable energy sources. [How does Bitcoin mining influence the energy sector]

Bitcoin’s Unique Ability to Mine Surplus

In addition to developing the renewable energy industry, Bitcoin mining also makes the electricity grid more efficient.

Indeed, it is almost impossible for a power plant to produce exactly the quantity of energy requested at a given time, and this is even more so for green energy. It is not possible to ask the Sun to hold its light, the wind to pause, or volcanoes to stop heating.

Installing a Bitcoin mining farm at the foot of a power plant therefore makes it possible to exploit this surplus energy, generate income from losses, and turn off the mining computers when electricity demand increases.

A large part of the energy produced around the world is wasted every year:

For example, Texas is the state in the United States with the greatest potential for green energy production. Located at the crossroads between the route of the Sun and that of the wind, it not only has vast reserves of fossil fuels but also privileged access to solar and wind resources.

Establishing infrastructure to transport energy from Texas to other regions takes time and significant financial resources, and is sometimes even impossible. In this context, Bitcoin mining emerges as the optimal solution to exploit the energy surpluses generated by already existing power plants.

The company ERCOT has also reserved 1.7 GW for Bitcoin mining during the winter of 2022. This allowed them to better adapt to peaks in electricity demand.

Additionally, Japan’s largest energy company, TEPCO, uses surplus electricity to mine Bitcoin (BTC) and generate more profits.

Renewable energies are not always in line with society’s demand for electricity. For example, solar energy reaches its peak production during the middle of the day, when electricity demand is typically lower. This often results in excess energy that cannot be immediately consumed.

Read also: Spot Bitcoin ETFs Explained: Everything You Need to Know

Storing these surplus productions in batteries would be too expensive and above all too polluting. However, Bitcoin mining can play an important role in regulating these surpluses.

Bitcoin miners can thus absorb this surplus energy during production peaks, helping to balance the supply and demand of electricity throughout the day.

This efficient use of surplus energy could represent a crucial step towards a more sustainable and energy-efficient future. [How does Bitcoin mining influence the energy sector]

Being able to exploit these electricity surpluses represents a considerable opportunity for governments to increase their revenues. In 2021, the European Union generated more than 700 TWh of surplus, the United States almost 200 TWh, India 250 TWh, China 330 TWh, and Mexico more than 35 TWh.

Finally, in 2021, more than 2,100 TWh in the form of gas were burned or simply released into the air, these surpluses could power the Bitcoin network 18 times.

In a hypothetical scenario where Bitcoin would be exclusively powered by this surplus energy, its carbon footprint would then be negative, because the entire network would be supported by energy which would no matter what happens even without it.

How could the heat generated by BTC mining be exploited?

Some of the energy consumed by a Bitcoin mining machine is used to secure the blockchain, but most of that energy is simply transformed into another energy: heat.

The energy we use to heat our buildings represents one of the largest sources of greenhouse gas emissions and plays a central role in decarbonization initiatives.

On the other hand, managing ventilation is one of the main challenges for computer designers, as overheating the device can lead to its deterioration in the long term.

On the one hand, humanity needs access to hot water and comfortable homes, even in winter. For their part, Bitcoin miners must dissipate the heat produced by their computers to ensure their proper functioning. [How does Bitcoin mining influence the energy sector]

Why not consider a synergy between these two needs?

An Antminer S9 (an older generation of machine for mining Bitcoin with a power of 16 Th/s) emits as much heat as an average 1,000 W radiator, while an Antminer S19 (a more recent generation with a power of 140 Th/s) emits 3 times more heat.

In short, replacing a radiator with a Bitcoin miner would heat a home while generating passive income, reducing the electricity or gas bill.

In the future, if buildings, homes, and offices were heated using Bitcoin mining, this would double the efficiency of the energy consumed.

How does Bitcoin mining influence the energy sector

Therefore, the carbon footprint of this energy, regardless of its source, would be cut in half, because it would be used both to secure the Bitcoin network and to heat buildings simultaneously.

In a hypothetical scenario where Bitcoin mining is used exclusively as a heat creator, its carbon footprint would be zero, because the entire network would then be supported by energy that would only be used for heat creation.

Furthermore, using Bitcoin mining machines as radiators would have the advantage of extending their lifespan, thus reducing the production of computer waste.

The savings made through the use of ASICs could be significant, even if the profitability of the latter fell negative because this would remain profitable compared to the usual costs of our traditional heating systems.

For example, the company DCX uses the heat generated by Bitcoin mining to heat a 40-room hotel, thus covering not only space heating needs, but also water heating. [How does Bitcoin mining influence the energy sector]

Bitcoin Could Become the Battery the Energy Industry Needs

Bitcoin mining could have a very important role in the energy industry. The numbers show that Bitcoin consumes relatively little energy compared to the financial system.

Additionally, Bitcoin miners take advantage of renewable energy and can help regulate energy surpluses, which can go a long way in the fight against global warming.

Read also: How to Open a Bitcoin Account?

It’s time to stop fighting Bitcoin mining, demand to change its code and start recognizing that it can be a positive player in the energy industry, providing significant environmental and economic benefits.

To summarize, Bitcoin has the potential to become much more than just a digital currency. It could evolve to become the battery allowing the storage and recovery of energy wasted without it. After revolutionizing the way we exchange value, Bitcoin could well revolutionize the way we consume energy.

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