Several people have asked me about the new modules humming in electrical substations north and west of Bemidji.
They are crypto mining facilities and they consume enormous amounts of electricity and benefit from proximity to “raw” power coming through transmission lines from the power stations in central North Dakota. Unfortunately, the enormous amounts of electricity they consume comes a cost to teh environment and public health.
Crypto mining is the process of creating cryptocurrency in which both individuals and companies can participate.
Commonly, one operator benefits and few or no local jobs are created. A recent study found that Chinese entrepreneurs were mining in at least 12 U.S. states. They make the money, and we get the atmospheric contaminants from increased electricity generation.
Crypto mining can affect electrical cooperatives. Our local electric cooperative is one of many that sells electricity to enable a crypto miner to compete in the mining business that can yield crypto dollars to an individual operator.
The crypto miner pays to run and keep cool their hundreds or thousands of computers to do the calculations that create cryptocurrency. It is not unusual for these bundled computers to literally catch fire and burn up.
So, what does this have to do with electrical cooperatives and energy markets? Crypto mining represents a new electricity market that we did not have previously. We usually have peak and off-peak periods every day. Crypto operations can fill in the off-peak times with new loads. Generally, the more power generated, the more efficiently power plants operate.
They must provide an amount of electricity to meet peak demands, usually between 4 and 7 p.m. Typically, a generation cooperative sends power to a group of distribution cooperatives. High-capacity transmission lines end at substations from which the distribution cooperatives deliver power to households and other local customers, like schools or factories, which create local jobs.
Each household is responsible for a small carbon footprint. In great contrast, one crypto-mining operation may produce a carbon footprint equivalent to thousands of households. Crypto mining operations in the United States today draw 2.3% of all our electricity or more than the country of Poland.
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Today, crypto mining facilities buy power at the substations from the distribution cooperatives, keeping the generation plants closer to their peak level of power production. Often, these computer banks are located near distribution substations and buy off-peak power at a price negotiated between the cooperatives and the crypto miners.
The rub comes when we look at the environmental impacts of electric generators. The worst impacts are from burning lignite coal, which drives our plants in North Dakota. The more power they generate, the more carbon comes from their stacks. In addition to carbon emissions, mercury and other unhealthy by-products, some of which may be captured and landfilled as the generator is ordered to do by law.
The arrangement by which we continue to run generators near their peaks to enable crypto mining ignores the impact of coal burning on health and climate. One plant can release hundreds of pounds of mercury each year. Every coal-burning plant contributes to the weather events that we plainly see across our country in the forms of fires, floods, invasion of destructive insects, unprecedented windstorms and more significant hurricanes.
We have seen the demand for electricity decrease in the household market, but overall, it is still on the rise. We can’t simply close our coal plants without replacing their power production. Plus, we need to sequester that carbon somehow. Some plants are on a path to pump their carbon dioxide into bedrock, which is good but is not yet operational.
Allowing crypto mining to keep generators spinning while rising atmospheric carbon levels contribute to climate change feels problematic, to say the least.
Perhaps our rural electric cooperatives could tailor their carbon emissions to be as low as possible while fulfilling their local members’ needs without supporting crypto mining.
Charlie Parson is a member of the Citizens' Climate Lobby organization. For more information, visit CitizensClimateLobby.org.
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