Today the US Energy Information Administration (EIA) announced that it is starting an interim survey on the electricity consumption of cryptocurrency mining companies in the United States.
Cryptocurrency mining expanded rapidly in the US following China's ban on cryptocurrency mining in 2021. By 2023, estimates indicate that almost 38% of the world's cryptocurrency mining will occur in the US. USA, making it the leading cryptocurrency mining country in the world. The growth of cryptocurrency mining threatens to keep polluting coal- and gas-fired power plants running, overloading the grid and potentially raising electricity rates for American families.
Mandy DeRoche, deputy attorney general for Earthjustice's Clean Energy Program, issued the following statement:
โUntil now, proof-of-work cryptocurrency mining has been largely invisible to US regulators with little to no reporting requirements. The massive energy consumption of cryptocurrency mining and its rapid growth in the United States threatens to undermine progress toward achieving climate goals and threaten networks, communities, and taxpayers.
โWe are encouraged by EIA's actions to gather information about this energy-intensive industry, which has grown so substantially in the United States over the past two years and about which there is so little publicly available information. Many organizations and individuals have attempted to collect this information but have been unable to do so. Requiring cryptocurrency mining operations to report their energy use is a game-changer for this industry that has thrived in the shadows. Cryptocurrency energy use data is crucial for grid operators, state and federal regulators, and the communities that host these problematic facilities. โWe look forward to the next steps of the EIA after this interim step.โ
Background
In November and December 2022, Earthjustice, in partnership with many other organizations, submitted comments to the US Energy Information Administration regarding the negative climate and environmental impacts of cryptocurrency mining, requesting that the agencies collect data on the energy consumption of cryptocurrencies.
In September 2022, the White House Office of Science and Technology Policy published a report on the industry's climate threats and the need for regulation. Earthjustice and the Sierra Club published a guide, โThe energy bombโ finding that in one year from mid-2021 to mid-2022, Bitcoin mining in the US alone consumed as much electricity as four states combined, emitting 27.4 million tons of CO2, equivalent to the emissions of up to 6 million cars a year.
The massive energy consumption of cryptocurrency mining threatens to undermine decades of progress towards achieving climate goals and reducing local pollution. Additionally, cryptocurrency mining practices increase costs and risks for utility companies and their ratepayers, can overload power grids, and flood communities with noise.
Instead of investing in long-term energy infrastructure that benefits the grid, the cryptocurrency mining industry looks for the cheapest available energy that can meet its needs. In practice, that translates to mining cryptocurrencies in and near coal and gas plants and tapping power grids that are often fossil fuel-heavy.
