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Bitcoin Miners Are Providing New Life to Old Fossil-Fuel Power Plants

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Bitcoin Miners Are Giving New Life to Old Fossil-Fuel Power Plants

Throughout America, older fossil-fuel power plants are closing down in favor of sustainable energy. But some are getting a brand-new lease on life– to mine bitcoin. In upstate New York, an idled coal plant has actually been restarted, fueled by natural gas, to mine cryptocurrency. A once-struggling Montana coal plant is now scaling up to do the same.The lofty

cost of bitcoin and other cryptocurrencies has financiers putting cash into power generation– and risking a reaction. Elon Musk tweeted last week that Tesla Inc. would no longer accept bitcoin as payment for lorries over concerns about fossil-fuel usage in bitcoin mining. That rocked the marketplace; bitcoin costs are now down around 25% because recently.

The drive for power has its roots in bitcoin’s intractable mathematics: To run securely, the cryptocurrency’s network counts on computer systems resolving puzzles; in return the solvers get fresh bitcoin. The greater the bitcoin price, the more of these miners contend to fix the puzzles– a procedure that chews up electricity. The more competitors, the more difficult the puzzles get and the more electrical power is used.

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” 6″ > SHARE YOUR THOUGHTS Do you think cryptocurrency is here to remain? Why or why not? Join the discussion listed below. A University of Cambridge index pegs the annual power consumption of bitcoin mining at around 130 terawatt-hours, more than three times higher than at the start of 2019. That would be more than the power consumption of Argentina.

The coal-fired Hardin Getting Station in Montana had actually been struggling for many years. Late in 2015, a Nasdaq-listed miner called Marathon Digital Holdings Inc.. MARA -4.57% partnered with Hardin’s owner to change the power plant into a center for mining bitcoin.

” It was an idle asset,” Fred Thiel, Marathon Digital’s president, stated in an interview. “We were able to get access to a big quantity of power at a very attractive price.”

The job remains in the process of scaling up, with more than 100 megawatts of power capacity planned. Marathon Digital, whose financiers consist of BlackRock Inc. and the hedge fund Renaissance Technologies LLC, stated that by tapping the Montana coal plant, its break-even costs to produce a bitcoin will be up to $4,600, 38% less than previously.

The company is aiming to produce at least 55 bitcoins daily by the very first quarter of next year, up from an average of 2 a day in 2020.

Besides mining bitcoin, Marathon Digital stated that as of March it had nearly $300 million worth of bitcoin on its balance sheet, in an effort to indicate its confidence in bitcoin’s future and draw in institutional investors to the stock who may desire exposure to the cryptocurrency however were not able to or reluctant to invest in it directly.

BlackRock and Renaissance decreased to comment.

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, 1260px” src =” https://images.wsj.net/im-340883?width=620&size=1″ data-enlarge=” https://images.wsj.net/im-340883?width=1260&size=1″ alt= “” title =” Private-equity firm Atlas Holdings purchased the idled Greenidge power station in 2014.”/ >< figcaption class="wsj-article-caption post __ inset __ image __ caption "itemprop= "caption" > Private-equity company Atlas Holdings purchased the idled Greenidge power station in 2014.< span class=" wsj-article-credit post __ inset __ image __ caption __ credit "itemprop= "creator

” > Picture: John Christensen/The Chronicle Express/USA TODAY NETWORK Among the most enthusiastic– and questionable– projects originates from private-equity company Atlas Holdings. Based in Greenwich, Conn., the company concentrates on turnarounds of struggling companies. It purchased the Greenidge coal-fired power station in 2014 after the plant in Dresden, N.Y. had actually been shut a few years previously due to the fact that it was economically unattractive to operate. Atlas first converted the plant to natural gas from coal. Then, in 2015, it introduced an information

center for mining bitcoin using power the plant generated. The company said it currently has 19 megawatts of mining capability and prepares to raise it to 85 megawatts by the end of 2022. Yvonne Taylor, vice president of the environmental nonprofit Seneca Lake Guardian, stated air pollution and water runoff will damage a little neighborhood whose fresh air and tidy water allows tourism, farming and fishing in the Finger Lakes.

Last month, local advocates led a march to the gates of the power plant, and some groups have actually written letters to New york city’s Department of Environmental Conservation and Gov. Andrew Cuomo advising them to revoke the plant’s authorizations. The state has decreased to do so. Last month, however, the Department of Environmental Conservation said it was closely monitoring Greenidge’s planned growth. It stated it likewise would speak with the U.S. Epa about the facility’s greenhouse-gas ramifications.

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The plant has actually drawn opposition from ecological activists in New york city’s Finger Lakes region.< period class =" wsj-article-credit post __ inset __ image __ caption __ credit" itemprop=" developer "> Photo: John Christensen/The Chronicle Express/USA TODAY NETWORK Greenidge stated in March it was going public through a merger with Nasdaq-listed Support.com, which supplies outsourced customer-support services. Under the deal, Support.com investors would get 8% of the combined company’s shares. In exchange, Greenidge stated it would use the money on Support.com’s balance sheet to money its growth. There’s another prospective benefit as well: Support.com has more than $ 145 million in federal net operating loss carryforwards, which could significantly lower the combined business’s taxes if the bitcoin operations prove to be successful moving forward.

Greenidge didn’t respond to a question on the prospective tax benefits. It said last week it would start acquiring voluntary carbon offsets and invest a part of its mining profits in renewable-energy jobs. Besides mining bitcoin, Greenidge stated the power plant continues to send electrical energy to the grid.

” Greenidge has changed an old coal-fired power plant into a tidy, trustworthy source of power for thousands and an integrated data processing center mining bitcoin,” the company said in written response to questions. “We are grateful to enjoy terrific assistance from the regional neighborhood.”

Support.com declined to comment.

The task has drawn the attention of state legislators in Albany, where an expense under review would place a three-year moratorium on crypto currency mining amid emissions issues.

” New york city is literally the world’s head office for finance,” said state Sen. Kevin Parker, a Democrat who sponsored the bill. “However we also want that to be done in a way that comports with our values.”

< div data-layout =" header" data-layout-mobile="" class= "media-object type-InsetMediaVideo header scope-web|mobileapps article __ inset article __ inset-- type-InsetMediaVideo short article __ inset-- header" >< figure class=" media-object-video post __ inset __ video media-object-video-- basic" >< figcaption class=" wsj-article-caption post __ inset __ video __ caption "> Chinese bitcoin miners have long controlled the international processing power that runs the bitcoin network with sophisticated equipment and access to low-cost electrical power.

And now, a group of U.S. miners with deep pockets wishes to dominate a greater share of the market. Image: Adam Chapman for The Wall Street Journal The proposition is a problem for Michel Amar, the CEO of Digihost Technology Inc. In 2015, Mr. Amar and his child began constructing out mining capability in northwest New york city state, intending to benefit from low-cost, tidy power that comes from hydro generation around Niagara Falls.

Their business produces more than 30 bitcoins monthly, and gets more than 90% of its electrical energy from hydro power.

This year, amidst the bitcoin price surge, the company announced it would likewise buy a 60-megawatt natural-gas plant north of Buffalo, N.Y. It prepares to at first direct 35 megawatts towards bitcoin mining while also sending power to the grid when it’s required.

Mr. Amar said the company would partially sustain the plant with natural gas originated from animal manure and other sources.

At the exact same time, he said the business is considering leaving New York if the moratorium is enforced, possibly setting up shop in other states or Canada.

” What is the difference in between a data center processing for Amazon and an information center for bitcoin?” he stated. “Our objective and dedication is to be green as much as we can.”

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