Bitcoin pump prompts ‘emergency’ review of US crypto miner energy use

SUPEREX 2024-02-01
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The Department of Energy is collecting crypto miner’s energy consumption data and public comments on the industry’s energy use starting next week.

Bitcoin pump prompts ‘emergency’ review of US crypto miner energy use

The United States Department of Energy (DOE) is demanding crypto miners report their energy consumption for the next six months after concerns a recent increase in the price of Bitcoin (BTC) is leading to a rush of crypto mining. 

On Jan. 31, the U.S. Energy Information Administration (EIA) — the statistics agency of the DOE — said it is initiating a provisional survey to gauge the electricity usage of local crypto mining companies starting next week, with miners “required to respond with details related to their energy use.”

The Office of Management and Budget greenlit the survey on Jan. 26 after an emergency request from the EIA days earlier claimed Bitcoin’s price “increased roughly 50% in the last three months” would “incentivize more cryptomining activity, which in turn increases electricity consumption.”

Cointelegraph Markets Pro shows Bitcoin rose just over 18.5% in the three months to Jan. 24.

Public comments regarding crypto miner’s energy use will also be collected.

We're initiating collection of data regarding #electricity use by US #cryptocurrency miners.

We'll ask about their electricity consumption so we can better understand their energy demands.

https://t.co/gYpZgtiD6J pic.twitter.com/pQ9ULoLAAU

— EIA (@EIAgov) January 31, 2024

EIA Administrator Joe DeCarolis said it would “specifically focus on how the energy demand for cryptocurrency mining is evolving, identify geographic areas of high growth, and quantify the sources of electricity used to meet cryptocurrency mining demand.”

The survey is the U.S. government’s latest move to get a handle on the crypto mining industry. The country became the world’s largest hub for miners looking to move operations after China banned the practice in 2021.

Lawmakers probed the mining industry at a 2022 Congressional hearing over concerns about energy use and fossil fuel emissions. In early 2023, Congress called for the Environmental Protection Agency (EPA) to investigate the impact of crypto mining.

U.S. President Joe Biden last year also floated a proposal to implement a 30% incremental tax on crypto miner’s electricity costs to “reduce mining activity” in the country.

Related: Bitcoin’s water consumption: A new environmental threat?

Last year, Bitcoin miners globally consumed an estimated 121.13 terawatt-hours of electricity — an all-time high from data going back to 2010, per Cambridge University’s Bitcoin Electricity Consumption Index.

In comparison, 2022 data from the International Energy Agency (IEA) shows the European country of Belgium consumed 93.8 terawatt-hours.

That consumption is expected to increase, with the IEA forecasting in a Jan. 25 report that crypto mining will use 160 terawatt-hours by 2026.

Categories: Bitcoin
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