Lawmakers Call for Regulating Cryptomining

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Lawmakers Call for Regulating Cryptomining

Several lawmakers have sent a letter to the heads of the Environmental Protection Agency (EPA) and Department of Energy (DOE) to express concerns about cryptomining.

Cryptomining has emerged as a resource-intensive task that is increasingly being viewed as climate-unfriendly. Lawmakers are now writing Michael Regan, Administrator of the EPA, and Jennifer Granholm, Secretary of the DOE, to provide additional information about the energy impact of cryptomining, including the impact it is having on residents and small businesses.

In their letter, Senators Elizabeth Warren, Sheldon Whitehouse, and Edward J. Markey, were joined by Representatives Jared Huffman, Rashida Tlaib, and Jeffrey A. Merkley.

Cryptomining in the city of Plattsburgh, New York reportedly resulted in residential electricity bills that were “up to $300 higher than usual” in the winter of 2018, leading the city to introduce the nation’s first 18-month moratorium on new cryptomining operations. A recent study estimates that “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.” Moreover, states like Texas with relatively cheap electricity costs are experiencing an influx of cryptomining companies, raising concerns about the state’s unreliable electricity market and the potential for cryptomining to add to the stress on the state’s power grid.

The lawmakers point out that the problem is amplified by a lack of regulation and oversight for the industry in general, leading the lawmakers to reach out to seven of the top cryptomining companies in the US.

The seven companies alone indicated that they presently have developed over 1,045 MW capacity for cryptomining. This is nearly enough capacity to power all the residences in Houston, Texas.

The lawmakers also expressed concern over the carbon emissions the industry produces. While some of the top seven companies touted facilities that were using sustainable energy, other of their facilities produce massive amounts of carbon.

For example, Riot indicated that its 51 MW Coinmint facility “utilizes nearly exclusively hydroelectricity, a zero-emission, sustainable energy source.” But its Whinstone facility, which is seven times larger, uses power from the Texas grid that relies on coal or natural gas for more than 63 percent of its generating capacity.

The letter is the latest challenge for an industry already reeling from massive losses.

Lawmakers Call for Regulating Cryptomining
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