A Group of US Lawmakers Want Answers About Energy Use and the Environmental Impact of Cryptocurrency Mining

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A group of eight U.S. Democratic lawmakers led by Massachusetts Senator Elizabeth Warren is seeking answers from U.S.-based cryptocurrency mining operations about their energy consumption and the potential environmental impact of their activities.

A series of letters were sent to a total of six crypto mining companies: Riot Blockchain, Marathon Digital Holdings, Stronghold Digital Mining, Bitdeer, Bitfury Group and Bit Digital.

If the mails are personalized at each operation, their content is essentially the same list of requests:

How much electricity is consumed by your operations and how much carbon is generated as a result?

Do you have any special agreements in place with local electricity providers?

What are your future plans to scale your operations?

Do you have estimates or models detailing the impact of your operations on energy costs for families and small businesses in your area?

U.S. lawmakers and regulators have been quietly rumbling about the home power consumption of crypto for some time. However, two recent factors seem to have catalyzed this new demand for information.

The first was a hearing held by the House Committee on Energy and Commerce titled “Cleaning Up Cryptocurrency: The Energy Impacts of Blockchains,” during which the committee heard testimony on the energy and environmental impacts referenced more late in the letters.

The second was a report published by the University of California, Berkeley titled “Power-Hungry Cryptominers Are Driving Up Electricity Costs for Residents.” The letters directly reference this report, focusing in particular on its claims that crypto-mining operations in New York State have resulted in an annual increase in electricity bills of approximately $165 million. dollars for small businesses and $79 million for residential customers.

It also pulls data from a Congressional Research Service report titled “Bitcoin, Blockchain, and the Energy Sector,” which found a $300 increase in the city of Plattsburgh, New York, caused by local operations of crypto-mining. This spike, according to the report, resulted in “the nation’s first 18-month moratorium on new cryptomining operations.”

The letter notes that the US share of crypto mining rose from just 4% in August 2019 to 35% in July 2021, which it blamed, at least in part, on a recent crackdown on mining operations in China. . The authors of the letter expect this share to continue to grow to more than 40% next year.

Due to the rapid growth already seen and the promise of further expansion, the eight lawmakers want “more information about the operations of these crypto-mining companies” to help them understand “the full extent of the consequences for our environment and local communities”.

While no direct regulatory or legal action is suggested in the letters, senators and representatives are expressing serious concerns that could lead to such things in the near future.

In addition to Senator Elizabeth Warren, the signatories of the letter include Senators Sheldon Whitehouse (Rhode Island), Jeffrey A. Merkley (Oregon), Maggie Hassan (New Hampshire) and Edward J. Markey (Massachusetts), as well as Congressional representatives Katie Porter (California), Rashida Tlaib (Michigan) and Jared Huffman (California).

Lawmakers gave recipients of the letters until Feb. 10 to answer their questions.

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