Share of renewable energy in bitcoin mining ranges from 39% to 74%, says crypto-investor Serhiy Tron

More and more cryptocurrency mining companies are switching to renewable energy sources, which are almost equal in price to the usual ones. This is reported by Ukrainian entrepreneur and founder of White Rock Management Serhiy Tron in his column for the Medium website.

It is the case of using surplus energy that is not used in the power system – either ‘green’ energy or the products of mineral processing.

The investor emphasizes that the process of mining can be compared to power consumption of an entire city or even a country.

“The mining process constantly requires more and more computing capacity and, accordingly, more power. One bitcoin transaction requires the same amount of power as the average family consumes in two and a half months, i.e. about 2170 kW*h.  Nature Climate Change published a study with a forecast that at the current pace of bitcoin development, its ‘mining’ will create enough carbon dioxide emissions to warm the planet by 2°C in less than 30 years,” said Serhiy Tron.

According to the crypto-investor, the issue of excessive power consumption and harmful emissions into the atmosphere was raised more than once in the expert environment, this resulting in the Crypto Climate Accord initiative, which was supported by over 250 mining companies. The initiative aims to achieve zero net emissions in the crypto-industry by 2030. For a complete transition to a new system, it is necessary to develop uniform standards and start implementing them in mining practice.

According to Serhiy Tron, it is difficult to detect exactly what energy sources miners use, but nothing prevents them from switching to more environmentally friendly resources.

"Right now, the price of power from renewable sources is almost comparable to other environmentally harmful ones, and the miner can choose between ‘clean’ and ‘dirty’ energy. To avoid harm to the environment, miners use surplus energy that is not used in the power system: either ‘green’ energy or products of mineral processing. According to various data, the share of renewable energy sources in bitcoin mining ranges from 39% to 74%. There is no more exact data because of decentralization of cryptocurrencies. Simply put, anyone in the world with a computer can ‘mine’ bitcoin. And it is quite difficult to track what energy sources they apply," said the owner of White Rock Management.

According to Serhiy Tron, effectiveness and feasibility of using renewable energy sources in the crypto-industry is confirmed by experience of many countries. For example, in China, where they banned mining in an attempt to reduce atmospheric emissions, they achieved the opposite effect: miners moved to other countries, and the released volumes of RES appeared to be useless. As a result, the share of alternative energy sources in the country's power system has dropped by 20%.

The businessman gives another example. A hydroelectric power plant in Costa Rica, the services of which were rejected by the authorities, offered to generate power for crypto-investors. As a result, the station owner was able to retain his assets, jobs, and reach profitability.

“As we can see, mining stimulates the development of green energy and acts as a significant driver of economic advance as a whole: it ensures the launch of new renewable energy facilities, which results in new jobs and tax payments. Miners act as an enzyme that activates competition and adoption of new technologies. Cryptocurrency mining by socially responsible investors becomes a growth point that multiplies the development of related industries,” concluded Serhiy Tron.