The story in New York State began at the Greenidge facility along the shores of Seneca Lake in the heart of the Finger Lakes, and is now the test case for proof of work crypto in New York, and beyond. This once mothballed coal-fired plant sat dormant for 7 years before it was repurposed to burn natural gas to supply power to the grid in times of high demand. Quickly finding that unprofitable, the owners installed 7,900 Bitcoin machines. This change in usage increased the air emissions at the Greenidge plant ten-fold compared with its previous levels as a “peaker” power plant. In January 2020, for example, operating at 5% of its capacity (similar to when it was serving as a power plant) the plant emitted 28,301 tons of CO2. This is equivalent to what would be produced by the electricity consumption in over 4,000 households. By December of 2020, CO2 emissions jumped to 243,103 tons. During that same period NOx emissions jumped from 5.2 to 49.2 tons. CO2 is a potent greenhouse gas that fuels climate warming and instability. Increased NOx levels have deleterious respiratory effects on humans, and have been associated with numerous other human health impacts.
Now, Greenidge’s plan is to expand 25-fold by 2025, using at least 500 megawatts of power along Seneca and elsewhere. Recently, Greenidge Generation LLC submitted its application for a renewal of its air permit and requested that their current air permit be unchanged, which allows annual emissions of up to 641,878 tons of carbon dioxide equivalent (“CO2eq”). This power plant had zero emissions for approximately 5 straight years (2011-2016) and then was permitted in 2016 to pollute 641,878 tons of CO2eq per year. The power plant will continue to increase its energy consumption and its emissions to its permitted limit, absent any modifications to the permit by the the New York State Department of Environmental Conservation (NYSDEC).
Concerns about the plant’s negative impact are varied: the facility could negatively impact the region’s clean air, water, aquatic life, the health of its 4.2 trillion-gallon fresh water lake (that serves as a drinking water source for 100,000 people), and the region’s vibrant economic engine of agriculture and tourism which supports 58,000 jobs and generates $3 billion annually for New York.
The plant is legally permitted to discharge up to 134 million gallons of 108 degree F water into Keuka Outlet a day. This stream drains directly into Seneca Lake, and is ranked by New York State Department of Environmental Conservation as a protected trout stream (data set here). While the dilution factor of this quantity of the hot water into Seneca Lake is considerable, the flow volume of Keuka Outlet, and dilution value it provides, is considerably less. Furthermore, thermal inputs of any sort can enhance the growth of environmentally destabilizing harmful algal blooms (HABs), which are plaguing many water bodies, including the Finger Lakes, in recent years.
Opponents of the facility include residents, property owners, grape farmers, winery owners, and vacationers who flock to the Finger Lakes each year to enjoy this world-class tourist destination. While this community is unique in many ways, it’s also similar to “Anytown, USA,” made up of farmers, teachers, small business owners and residents who are working hard to protect their families and livelihoods from polluting industry.
Greenidge is not an outlier, it is a new business model that Bitcoin investors are eager to replicate. Bitcoin operators search for areas with cheap power sources or power plants that are not operating at full capacity to install Bitcoin mining machines.
Some power plants still in operation are also considering changing their operations from electric production to Bitcoin mining. For example, in April 2021, the 55 MW gas-burning Fortistar-North Tonawanda plant outside Buffalo, New York applied for permit for this type of conversion. If approved, a Canadian Bitcoin operator would acquire the plant and run it as a cryptocurrency mining operation.
As this article was going to print, we learned about two new sources of energy to power Bitcoin mining in nearby Pennsylvania. On July 29, 2021, the Pittsburgh Post-Gazette published a report about a coal plant in Venango County (just northwest of Pittsburgh) that is being transformed into a cryptocurrency operation, burning waste coal. Two nuclear power plants—one in Beaver County that will supply energy to a mining operation in Ohio, and another in Luzerne County. The nuclear plant in Luzerne County will house its own data center to mine Bitcoin, using up to 12% of the facilities capacity.