Crypto miners can make money by unlocking new crypto currency like bitcoin, but the process is electricity-intensive which worries climate change activists.
AP/File DRESDEN – Opponents of what is becoming the state’s best-known and most-controversial crypto-mining facility have enlisted a Columbia University research institute to help explain why New York environmental officials should not renew its current air emissions permit.
The school’s Sabin Center for Climate Change has released a study exploring the legalities of regulating crypto mining and concluded that the Department of Environmental Conservation has the authority to issue, renew or deny air emissions permits from crypto miners who have their own power generation and don’t buy energy from the grid.
While the logic that a state agency can issue or deny permits may be self-evident, the study represents the latest dispute pitting environmentalists against crypto miners — in this case, the publicly traded Greenidge Generation, which operates a 106-megawatt natural gas plant on Seneca Lake in the Finger Lakes region that powers its crypto-mining operation.
The study also said that Gov.Kathy Hochul could impose a moratorium on new crypto mines powered by Greenidge’s own power plants pending an environmental review — similar in some respects to how Hochul’s predecessor, Andrew M.Cuomo halted hydrofracking from starting in New York.Since then, study author Jacob Elkin notes, the state passed a 2019 law, the Climate Leadership and Community Protection Act, or CLCPA, calling for steep reductions in greenhouse gas emissions in coming years.
The study “gives Gov.Hochul no excuse to stall in both denying the air permit and adopting a moratorium,” said Yvonne Taylor, of the Seneca Lake Guardian group that is battling Greenidge.
The company purchased what was a retired coal power plant, converted it to natural gas and is now using that power to run a vast bank of crypto-mining machines.
Crypto mining is based on the concept of blockchains, or web-based digital ledgers in which participants can make and record transactions.
Blockchain technology is best-known for the growth of cryptocurrency, or money-like digital tokens that people can use as credits to buy or sell items online.
Bitcoin is the predominant cryptocurrency but there are several others.As cryptocurrency has taken hold among the cyber-literate, crypto miners are earning money by creating new Bitcoins or other tokens.That’s done by running highly complex and exotic math formulas, or algorithms, that cryptocurrency users employ to keep track of the currency.
The miners who successfully run the formulas get their own bitcoin or currency which can be exchanged for cash or used to buy things on a blockchain ledger.
Crypto mining can be immensely profitable but the computing power needed to do this requires copious amounts of electricity.Thus, investment firms have been getting in the crypto-mining game, looking to buy or restart dormant power plants to run their computers, which is cheaper than buying energy off the grid.
The trouble is, restarting old power plants for crypto mining runs against efforts to reduce carbon emissions in order to fight climate change.
Crypto Moratorium White Paper by rkarlin on Scribd
There are bills in the legislature calling for moratoriums on new miners but it’s unclear whether they will be successful.Thus the call for the governor or DEC to act.
For now, much of the attention has gone to Greenidge, which has become a symbol for large-scale crypto mining in New York.
Greenidge has noted that it also generates power for the grid, not just its crypto mining.In other words, some of the electricity from this gas plant also goes to light homes or run factories.
And Greenidge has already beaten back one legal challenge, when a group of environmentalists went to court to tried to close it down after the DEC gave the firm an earlier air emissions permit.
An appellate division court ruled in 2019 that the DEC did in fact have final say over the company’s air permit.
“We fully adhere to our existing air and water permits and will continue to do so,” the company said in a prepared statement..
