Green Bitcoin Mining

Many have criticized Bitcoin as bad for the environment in the past. This isn’t new news. It is well known that mining Bitcoin becomes more difficult over time, thereby consuming more energy. However, we are in the midst of transitioning to renewable energy sources, globally. This transition will not happen overnight. We need stepping stones to get to a carbon-neutral future. This is the same for Bitcoin mining. Luckily, there has been much progress in green Bitcoin Mining.

Demand for electricity is typically highest during the evening when people are coming home from work and school. Dad starts to cook, mom puts a load of laundry in. Little Max has the T.V turned on next to an electrical heater. You get the picture. The clear pattern is that renewable energy is providing the most energy when people do not need it. According to the duck curve below, solar energy is not used on average between the hours of 9 am — 5 pm. This leads to the over-generation of solar energy. This is wasteful, but CleanSpark’s mPulse in combination with microgrids can help solve this problem.

CLSK’s Microgrid software —

What is a microgrid? A microgrid is a set of resources that, paired with energy storage provides energy to local communities; just like the nation’s electrical grid, just smaller. A microgrid can be connected to the main electrical grid or it can disconnect from it as conditions changes.

Microgrids contain solar and wind energy production resources. Solar and wind is good for the environment but is currently not practical. The sun shines during the day and the wind is typically strongest at night.

CleanSpark’s mPulse software is an adaptive distributed energy management system. mPulse can monitor individual microgrids, determine the available energy resources and apply the most efficient use of the energy in accordance to the user’s needs. It does this by using a proprietary algorithm.

So, what does this have to do with Bitcoin mining?

mPulse can direct electricity from renewable energy sources (solar, wind, battery storages) to Bitcoin mining facilities. Given that not all electricity produced by solar or wind, at a time when it is most abundant, can be consumed. Bitcoin mining can be a buyer of the otherwise, wasted electricity. This prevents the waste of renewable energy, allows the energy to be converted to a store of value while eventually not adding to the Earth’s carbon footprint.

“We also believe that we are the only publicly traded cryptocurrency mining company in the United States that mines 95% carbon neutral, and we’re on a path to improve that. Not only are we approaching carbon neutral, but we are also doing so at some of the lowest energy costs for Bitcoin mining in the nation.”

Mining at 95% carbon natural is pretty damn good if you ask me..

However, there is a win — win scenario playing out between Oil and Gas firms (O&G firms) and Bitcoin mining. At the end of day both operations seeks to be more profitable. O&G firms want to sell their stranded or wasted resources instead of flaring it (literally burning money) and Bitcoin miners want to use the stranded or wasted gas at cheap costs. This relationship gives the wasted gas a purpose and reduces flaring/venting methane into the air.

The Great American Mining has two products:

In the first product (Offtake agreements), The Great American Mining company enters into an agreement with O&G producers to buy their unwanted and stranded gas to power their own Bitcoin mining operations.

In the second product (Mining Infrastructure Purchase), The Great American Mining company sells their Bitcoin mining infrastructure to the O&G firms so the O&G firms can directly generate profits through Bitcoin mining. The Great American Mining company will provide the mining rigs, set up the rigs on-site and monitor/optimize the rigs to the specific O&G firm’s operations. This is the value proposition The Great American Mining company provides.

“Upstream Service offers clients three different mining packages. As detailed above, one involves buying the mining rig, supplying the gas and converting this gas into power, and the producers get to keep all the mining profits. With option two, they only provide the gas and power conversion without buying the skid, and Upstream Data keeps a slice of the profits.

Then there’s the third option. Upstream Data parks the skid on site and converts the gas to energy for them, offering the conversion for free in exchange for free gas. This might sound odd to hear that the companies are willing to supply the gas without any promise of mining rewards in return, but as Barbour told us, the payoff is getting rid of the by-product without having to pay for combustion — and staying compliant with regulations.”

My thoughts —

In my personal belief, Elon tweet about Tesla’s concern of the acceleration of Bitcoin’s electricity consumption powered by fossil fuel was misinformation with out more context. Total energy consumption does not equal pollution.

Energy comes from many sources. We are a society that generated electricity from coal and natural gas. It is entrenched in our society. It will take time to transition to other sources but that transition is underway. Examples being Cleanspark, The Great American Mining company, and Upstream Data.

Now, I am aware the three companies I mentioned above do not eliminate carbon emission but technically adds to it. However, without their technology, the amount of methane and CO2 released into the air from fossil fuel-powered mining, flaring, and venting would be much higher. Imagine if these technologies did not exist and miners continue to run their operations via fossil fuel and O&G firms continue to flare/vent. This would not be good.

Bitcoin is driving innovation in the energy sector. We are currently living in a time where incremental progress is being made towards green Bitcoin mining. The results may seem small now but these incremental steps will reinvent the way we use consume energy in the future. This was, and still is my view with Tesla. Those cars, batteries, and solar roofs all produce a carbon footprint but the idea was always, one day in the future this will be a net positive for the Earth.

I’ll just leave you with this picture..

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