Federal agencies have the power to compel crypto mining companies to disclose how much energy they use and how much greenhouse gases they emit, according to letters between the agencies and Democratic lawmakers shared exclusively with The edge.
Bitcoin miners have flocked to the US in recent years, raising concerns about electricity consumption and greenhouse gas emissions. Despite the proliferation of crypto mines in the US, there is no solid data on the impact each has on the power grid and national climate goals.
That could soon change as Democratic lawmakers pressure federal agencies to accelerate plans to require crypto mining companies to report their emissions and energy use. That kind of transparency is an early, critical step toward curbing crypto mining pollution.
“We urge you to introduce a disclosure regime through those authorities as soon as possible”
The Department of Energy (DOE) and the Environmental Protection Agency (EPA) have described “clear authority to require emissions and disclosures of energy use by cryptominers” according to a letter several members of the Democratic Congress sent to the agencies yesterday. It asks each agency to provide timelines for when they plan to exercise those powers and collect information.
“We urge you to use those authorities to implement a mandatory disclosure regime as soon as possible,” says the letter, which was signed by Senators Elizabeth Warren (D-MA), Sheldon Whitehouse (D-RI), Ed Markey (D-MA), Jeff Merkley (D-OR), Dick Durbin (D-IL), and Representatives Jared Huffman (D-CA), Katie Porter (D-CA), and Rashida Tlaib (D-MI).
This is the latest move in a saga that began last year when Democratic lawmakers asked the largest crypto mining companies in the US to share figures on their energy use and pollution. Seven companies combined have the capacity to use more than 1 gigawatt of electricity, nearly enough energy to power every home in Houston combined. the congressmen said.
While several companies have provided some data, none of them have provided full answers to the Democrats’ questions. That spurred congressmen to ask the DOE and EPA in July to require crypto companies to share information publicly to get a more complete picture of the impact they are having on the net and the environment.
Seven companies combined have the capacity to use more than 1 gigawatt of electricity, nearly enough energy if every home in Houston could use together, according to congressmen
Warren’s office shared the answers from the DOE and EPA to that July study with The edge. In November, Energy Secretary Jennifer Granholm wrote a letter to Warren saying the U.S. Energy Information Administration (EIA) has the authority to require crypto operations to report their energy usage if “operating facilities… involved in… large energy consumption.” Such a mandate would “require the development of a new survey to collect this information,” the letter said. The EIA may also require utilities to share information about how much electricity they sell to crypto companies.
The EPA, meanwhile, told lawmakers that the Clean Air Act gives it the ability to collect pollution data from facilities that pump at least 25,000 tons of carbon dioxide to Earth annually. The Democrats’ investigation into the country’s largest crypto mines has already revealed that at least two companies in the US operate crypto mines that fall into that category. Both companies already report those emissions under Clean Air Act requirements.
But the letter Warren and her colleagues sent yesterday asks the EPA to clarify whether it has already listed every crypto operation that meets the 25,000-ton threshold — and, if not, when it plans to do so. doing. The letter asks for a response by March 6. The edge contacted the EPA and DOE, but received no comment at time of publication.
Although there are no concrete figures yet on how dirty or energy-consuming crypto mines are in the US, the first estimates are striking. The activities of the crypto industry in the US probably consume about as much electricity as all the country’s home computers combined, according to a September report of the White House. That report recommended that the EPA and DOE work together to develop performance standards that would encourage crypto companies to move to clean energy while using less energy overall. If that doesn’t work, the report suggests the Biden “should investigate executive actions, and Congress could consider legislation.”
If that happens, the policy would primarily focus on Bitcoin – still the most popular and most polluting cryptocurrency. Other cryptocurrencies, including Ethereum, have already moved beyond the energy-intensive code that the Bitcoin network refuses to give up.
Bitcoin miners set up data farms filled with specialized hardware used to solve math puzzles. It’s part of a deliberately energy-inefficient process to validate new transactions. The miners are rewarded with new tokens in return, although that incentive has fallen along with Bitcoin prices during the ongoing crypto winter. Yet it is estimated that the Bitcoin network consumes nearly the same amount of electricity annually as the Netherlandsaccording to the Cambridge Center for Alternative Finance.