McFeely: who benefits from crypto-mines in ND? The New York Times has the answer – InForum

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FARGO The question has always been, why is North Dakota so determined to attract cryptocurrency mining operations?

This has clearly been the focus of Governor Doug Burgum and his cabinet. Burgum has loudly touted massive projects in Williston, Jamestown and Grand Forks.

His goofball buddy, “Shark Tank” fraudster Kevin O’Leary, has announced plans to build a data center at an abandoned Cold War-era radar base near Nekoma, while owner Bitzero Blockchain Inc. ., said it would move its headquarters to North Dakota. .

It is, according to the governor and his underlings, to diversify the state’s economy based on raw materials.

But the question has always lingered: who benefits?

It can’t be local communities, because crypto mining hubs employ few people once they’re up and running. It’s not like a factory moving to North Dakota that employs 500 people. It may be a few dozen full-time jobs.

The New York Times might have provided the answer with a recent report titled “The Real Costs of the Digital Race for Bitcoin.”

The extensive investigation comes to the conclusion that many suspect: there is little benefit except for cryptocurrency companies and power companies supplying the gargantuan amounts of energy needed to mine bitcoin.

The cost comes to the environment and eventually to electric utility customers who might see higher bills.

The money quote, if you will, comes from State Commerce Commissioner Josh Teigen.

From the Times:

The effect of bitcoin operations on the state economy is simple, said Commerce Commissioner Josh Teigen: They support our fossil fuel industry, and that’s exactly what we want.

North Dakota has an abundance of lignite, a type of coal primarily used to generate electricity. Teigen said the state ultimately hopes to capture carbon from fossil-fuel power plants and store it underground, reducing emissions while keeping the coal industry alive.

The state, once again, is betting on the dying coal industry. And bet on carbon capture technology whose reliability has not yet been proven.

Also from The Times:

…Bitcoin mines create far fewer jobs, often employing only a few dozen people once construction is complete, and provide less of a boost to local economic development.

Their financial benefits go almost exclusively to their owners and operators. In 2021, the year Bitcoin’s price peaked, 20 executives from five publicly traded Bitcoin companies together received nearly $16 million in salary and more than $630 million in stock options, records show. .

Electricity customers in Texas, another crypto-mining hotspot, have seen their bills soar by around 5% or $1.8 billion thanks to strong demand for crypto-mining, according to the Times.

Data centers are also terrible for the climate, generating multitudes of greenhouse gases due to the extraordinary power they consume. “Additional energy use across the country is also causing as much carbon pollution as adding 3.5 million gasoline-powered cars to American roads,” The Times reported.

The North Dakota coin is for power companies and the coal mines that supply them.

Oh, and foreign investors.

Energy customers in North Dakota and the climate? Maybe not so much.

Mike McFeely is a columnist for the Fargo-Moorhead Forum. He began working for The Forum in the 1980s while a journalism student at Moorhead University in Minnesota. He has worked full-time with The Forum since 1990, minus a six-year hiatus when he hosted a talk show on local radio.

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