The UK based CoinShares has released a report detailing the origins of global energy resources used in Bitcoin mining.
The crypto assets research and investment firm, listed on Stockholm’s NASDAQ/OMX exchange, conducted the survey in answer to critics’ continued arguments that Bitcoin mining is essentially an environmentally harmful activity due to its extreme use of electricity. It was also conducted in response to an article published by University of Hawaii’s Department of Geography and Environment which called on its own research to determine that Bitcoin mining could cause the pollution limits to exceed those stipulated by the 2015 Paris Agreement.
The article, written by Camilo Mora, asserted that this carbon footprint calculation was achieved by multiplying Bitcoin’s 2017 estimated energy consumption and CO2 emission rates associated with countries from which mined blocks were thought to have been mined. According to Mora:
“By multiplying the electricity consumption of every block in 2017 by the electricity emissions in the country where the proof-of-work was likely to be resolved, we were able to estimate the total CO2 emissions for computing every block in 2017.”
The CoinShares news report has responded to this calculation by calling on industry insider knowledge and data available to the general public in order to put together an estimate of exactly where the energy used by the miners originate. The proposal is that 77.6% of worldwide Bitcoin mining is conducted through the use of renewable energy resources.
CoinShares accuses the University of Hawaii’s report of being inaccurate and oversimplified which lacked the regional economic and political considerations of the CoinShares analysis. The reality, according to the new report is that most of the world’s crypto mining has been conducted in China up until now, which is calculated to be about 60% of global mining, despite many countries being driven overseas due to climbing costs and the search for cooler climates.
China now has a major campaign which is aimed at drawing the country to supplying renewable energy such as solar. The Chinese program, entitled “curtailment” is largely conducted in regions where most Bitcoin mining takes place. Last year China became the world’s highest producer of solar energy. This has resulted in a glut of power which regional grids in these newly labeled areas are simply unable to deal with.
The outcome is that companies mining Bitcoin are moving to the “curtailment “ areas to lower their production costs resulting in extremely high renewable powered mining statistics: 95% of Chinese mining through renewable energy and 80% of total Chinese mining (or 48% of global mining) occurring in Sichuan.
Outside of China, Russia is at the other end of the scale with only 17% of its cryptocurrency mining conducted using renewable energy recourses. Iceland, Georgia, and the Northwestern US, on the other hand, are strong adherents to the use of renewable energy for Bitcoin mining.
Projects are currently underway in the Sahara using a 900-megawatt wind farm south of Marrakesh, and in Japan using solar power through the Kumamoto Electric Power Company
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