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The problem is, we don’t know how much energy it’s actually using.
The price of Bitcoin set a new all time high this week, crossing the $69,000 mark on Tuesday before falling back down to around $67,500 by Thursday afternoon. That almost certainly means Bitcoin’s energy usage is rising, too — although any chance of getting a precise idea of how much, even just in the U.S., may be delayed for months. Last week, the U.S. Energy Information Administration agreed to stop collecting data on crypto mining operations after a federal court in Texas put a halt on the project until the EIA goes through a more fulsome approval process.
That Bitcoin eats up a lot of power is beyond dispute. Bitcoin mining involves solving increasingly complex math problems, which at this point requires vast amounts of computing power; using outside data, the EIA estimated that crypto accounts for around 2% of the nation’s total electricity use. Both the industry’s electricity usage and how it participates in electricity markets have been subject to criticism from Democratic lawmakers, who have pushed for more information-gathering. If the price of Bitcoin continues to climb, that skepticism could ratchet up.
“There is a very direct relationship between the value of what is being mined by the miners and how much is being spent on electricity,” Alex De Vries, a cryptocurrency and energy researcher, told me.
An extensive New York Times investigation last year found that large-scale mining operations were “putting immense pressure on the power grid,” and that “their operations can create costs — including higher electricity bills and enormous carbon pollution — for everyone around them.” According to the University of Cambridge Judge Business School, Bitcoin’s energy consumption has risen about 50% in the past year, from an annualized rate of around 110 terawatt-hours a year just over 163 TWh, comparable to the electricity production of Ukraine or Pakistan. (That is, of course, an estimate, based on a model derived from the performance of mining hardware and the assumption that miners only operate with hardware that allows them to mine Bitcoin profitably.)
With all the attention on consumption and emissions, Bitcoin miners have been eager to portray themselves as, if not quite the goodies, at least not the baddies.
“The industry as a whole has a good story to tell about the energy piece,” Tom Mapes, president of a newly formed industry group called the Digital Energy Council, told me. He also told me that I “have to be realistic about it. We do use a lot of power — not to say that using power in every facet is bad.”
The feel-good Bitcoin energy story goes something like this: Crypto miners are always ready to use energy at the right price — and to shut things down at the right price, too. “We have the ability as a bulk power user of our size has the ability to flex load like no another,” Mapes said. “Datacenters cannot flex load like this. We can be built in as a tool to work within constraints of these grids.”
If a mining facility is co-located with an energy resource, it can be there to purchase power production that might otherwise be curtailed because there isn’t enough transmission capacity to get it to other customers. It can also be a buyer of first resort for a newly developed generator or it can keep an old one in business, as Bitcoin mining has with some fossil fuel generators.
“You tend to see Bitcoin miners anywhere there’s stranded energy and excess power,” said Margot Paez, a fellow at the Bitcoin Policy Institute. There are some examples of crypto mining co-located with renewables, but that does not always mean that the power they use is entirely renewable. There’s also a crypto mining operation set up at a nuclear power plant in Pennsylvania, adjacent to what will be an Amazon Web Services data center.
The main way crypto operations interact with the grid is not by supporting any particular resource, though, but rather by being flexible about when they operate. Shutting off when demand is high can be quite lucrative — sometimes even more so than the crypto mining itself.
Riot Networks, a mining company with extensive operations in Texas and a plaintiff in the EIA record collection suit, has become a flashpoint for crypto’s interaction with the electricity markets precisely because it eagerly shares data with investors and the public about its participation in programs to maintain grid stability. In August, when demand hit record highs and Texas consumers were asked to conserve energy, Riot reported $8.6 million in revenue from selling Bitcoins it had mined and $31.6 million either from selling power it had bought for a prearranged price back to the grid at the higher market price or from incentive payments for being willing to power down during demand spikes.
The company’s chief executive said that last August “was a landmark month for Riot in showcasing the benefits of our unique power strategy.” (Of the 34 large Bitcoin mining operations in the New York Times investigation, Riot was the largest and had the most fossil fuel consumption attributed to it.)
But that was then and this is now. The revenues Riot is deriving from Bitcoin mining are likely substantially greater than they were five or six months ago, as the price of Bitcoin has almost doubled. The company has told investors that it costs around $7,500 to mine a single Bitcoin, which could mean that it and other crypto miners operating strategically in the electricity market will be less willing to sell power back to the grid or turn off during demand spikes.
If you’re thinking this all sounds a lot like the conversation around demand response, well, so was I. Demand response is something climate people love to talk about. They want consumers to get paid for using less power when demand spikes, and they think it’s really neat that you can charge an electric car overnight when demand is low and want you to be able to sell that power back to the grid when demand gets high.
Putting energy consumers near renewables and other non-carbon-generating energy sources that can absorb excess power when renewable production is “too high” for the grid is something you hear about a lot with, say, hydrogen production or energy storage. Why let that energy go to waste when we could incentivize people to store it, instead?
But an electrolyzer or a battery is not just a clever way to figure out how to deal with the peaks and valleys of variable renewable energy resources like wind and solar, it’s also potentially a key component of a decarbonized energy system. It doesn’t just consume non-carbon energy, it can store and transfer carbon-free energy as well.
Crypto, on the other hand, takes energy, renewable or not, and turns it into money. It’s a greedy and flexible consumer of electricity, and there are market designs where non-carbon generators would be happy to work with such a consumer. But from the perspective of the energy system, a consumer is all it will ever be.
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At a conference in New York, solar and wind developers warn of spiking electricity prices if IRA tax credits are cut.
As the renewable energy industry fights for relief from the House reconciliation bill’s harsh tax credit phaseouts, its members have coalesced around a dire and pragmatic message: America needs electricity, we’re the only ones who can provide it quickly, this bill will make that harder — and it’s electricity consumers who will have to pay the price.
“Now we have a different paradigm,” Jim Murphy, the chief executive officer of the energy developer Invenergy said Thursday at a conference hosted by the renewables trade group ACORE. Whereas in previous decades renewables largely replaced retiring fossil plants on the grid, today, “we need it all, and we need it all as fast as we can get.”
Even if customers want gas-fired power plants, the developers that build them likely can’t get them up and running until near the end of the decade. “We’re getting a lot of customer inquiries for gas-fired, as well,” Murphy said. “We can’t deliver that immediately the way we can deliver renewables immediately. 90% of what we have in the queue is renewables. Gas projects won’t be ready until the end of the decade.”
Sitting beside Murphy on the same panel, Sandhya Ganapathy, chief executive of EDP Renewables North America, described renewable deployment in the coming years as “not about ideology,” or even “one technology being better than the other.” Instead, “this is about pragmatism,” she said. “What does it take for the economy to be resilient? What does it take for the economy to be dominant out there?”
The answer, Ganapathy said, was whatever pushed electrons onto the grid fastest.
I heard the same idea repeated over and over on the panels I attended and from the people I spoke to: What makes renewables matter is how they serve the grid’s needs now, not how they help reduce emissions.
“For 25 years, what has happened in this industry is the retirement of coal plants, and to a lesser extent gas plants, and then the replacement of that capacity by renewables. That’s really the industry that we’ve all been part of,” Ted Brandt, the chief executive of Marathon Capital, said on Wednesday. “Right now we’re at an inflection point where we’re running out of retirements.”
The big buyer is a large technology company looking to power its data centers, Brandt said, and it’s willing to pay up.
“What hyperscalers really believe is that the acute constraint to AI and cloud is all about power,” Brandt said.
Though demand is high, there are roadblocks and costs that developers have to deal with even before worrying about the future of the Inflation Reduction Act — tariffs, high demand for scarce components such as transformers, interconnection and permitting delays. With tax credits of at least 30% (and often higher) possibly going away, the only way to solve the equation between high demand and high development costs is prices going up, Debbie Harrison, a partner at McDermott Will & Emery, told me.
One might wonder, then, exactly what the developers are so worried about. After all, if there’s rising demand for your product, why do you need a subsidy?
When I put this question to ACORE Chief Executive Ray Long, he emphasized that such a long pipeline of projects in response to demand from technology companies and utilities has accumulated in less than three full years since the IRA’s enactment.
“We have a two-and-a-half-year-old set of policy that was passed by the House and the Senate, signed by the president, that enabled and said to investors — and developers, and manufacturers, and everybody else — use these tax credits because we want you to come in and build and invest in everything that you’re doing,” Long told me.
“We need to be in a place in the United States where policy actually means something, that the people who are spending the money and doing all this can rely on,” Long went on. “The IRA is going to change. Everybody knows that if it’s going to change. It needs to be done in a responsible and balanced way that does not just discard all the investment.”
In the near term, moving up the deadline to qualify for clean energy tax credits to 60 days after the signing of the bill, as proposed in the House version, could cause a rush of construction starts. But that’s a thin silver lining, industry executives and analysts argued. Many projects simply may not happen at all.
Projects that would be eligible for tax credits “currently make up the vast majority of planned U.S. utility-scale electricity capacity additions,” analysts from Evercore wrote in a separate report released Wednesday. If the credits are “both rapidly terminated and rendered unworkable,” first by early phaseout and then by foreign entity of concern provisions (more on those in a minute), it would mean that many projects no longer pencil out economically, thus endangering “the United States’ ability to affordably meet growing electricity demand from data centers and other end users.”
Citing data from the U.S. Energy Information Administration, the Evercore analysts estimated that over 80% of the planned capacity additions could be eligible for clean energy tax credits, with 150 gigawatts of solar, battery, and wind projects planned but not yet under construction.
The foreign entity of concern provisions require tax credit recipients to isolate their business relationships and supply chains from a handful of U.S. adversaries, most notably China. This “introduces massive complexity” and is “very likely unworkable,” the Evercore analysts said. The FEOC provisions “would throw ongoing projects into uncertainty around post-2028 credit eligibility.”
The requirement to eliminate not just all Chinese companies, but also all Chinese “influenced” companies from the renewables supply chain would create numerous points of potential noncompliance for denying tax credits. And unlike the foreshortened timelines for starting construction on new projects in the House bill, the FEOC rules could mean “immediate uncertainty” around whether existing generation will remain eligible for credits they’d planned to claim through 2028 and beyond.
Executives at the ACORE conference were properly alarmed.
“FEOC is written so broadly because of components and subcomponents,” Murphy said Thursday. “The supply chain can not support that, and won’t be able to support that for several years. It’s just an unworkable provision.”
On Musk vs. Trump, tech emissions, and V2G charging
Current conditions: Polar air could deliver Australia’s most widespread snowfall in years this weekend • Toronto and Montreal have some of the worst air quality in the world going into Friday due to smoke from the Manitoba fires • Global average concentrations of CO2 exceeded 430 parts per million in May, the highest level in millions or possibly tens of millions of years.
Elon Musk’s criticisms of the Republican reconciliation bill triggered a very public falling out with President Trump on Thursday. Earlier this week, just days after his Oval Office send-off from the government, Musk took to Twitter to slam Trump’s “Big, Beautiful” bill, which he claimed would “massively increase the already gigantic budget deficit to $2.5 trillion (!!!) and burden America citizens with crushingly unsustainable debt.” By Thursday, Musk was calling for Congress to kill the bill, and his criticisms had escalated: “Keep the EV/solar incentive cuts in the bill, even though no oil & gas subsidies are touched (very unfair!!), but ditch the MOUNTAIN of DISGUSTING PORK in the bill,” he tweeted. Trump responded by telling reporters on Thursday afternoon that “Elon and I had a great relationship — I don’t know if we will anymore,” touching off a back-and-forth on social media that culminated in Musk claiming Trump is “in the Epstein files,” a reference to Jeffrey Epstein.
The conflict also sent “the value of Tesla shares into a freefall,” my colleague Matthew Zeitlin wrote in his accounting of the breakup. The company’s stock was down 14% by the time the dust settled, erasing $153 billion from Tesla’s market value in the company’s biggest one-day drop on record. “The whole thing is idiotic,” Wayne Kaufman, the chief market analyst at Phoenix Financial Services, said, per Bloomberg. “People in these kinds of positions should know better than to act like kids in junior high.”
Indirect emissions from Amazon, Microsoft, Alphabet, and Meta rose 150% in the three years between 2020 and 2023 due to the energy demands of artificial intelligence, a new report by the United Nations’ International Telecommunication Union found. Amazon saw the most significant jump in emissions, up 182% in 2023 compared to 2020, followed by Microsoft at 155%, Meta at 145%, and Alphabet at 138% over the same periods. In total, 166 digital companies reviewed by the report contributed just under 1% of all global energy-related emissions in 2023.
Indirect emissions, also called scope 2 emissions, account for those from “purchased electricity, steam, heating, and cooling consumed by the company.” However, the report also found that nearly half of the companies it examined have committed to achieving net-zero emissions goals, with 51 companies setting ambitious deadlines of 2050 or earlier. Twenty-three of the companies in the report already operated on 100% renewable energy in 2023, up from 16 in 2022. You can read the full report here.
Renault Group
Renault Group announced Thursday that the Dutch city of Utrecht is officially the first in Europe to debut a vehicle-to-grid car-sharing service. The program, called Utrecht Energized, was announced last fall, with Renault supplying an initial 500 electric models featuring V2G bidirectional charging technology, allowing the cars to charge using clean energy and also feed power back into the grid during times of high demand.
Utrecht was already one of Europe’s “most progressive renewable-energy cities,” per the announcement, with 35% of its roofs equipped with solar panels. “To manage the grid with a high proportion of renewables requires a system that quickly adapts to the changes in energy generation and consumption,” Renault wrote in its announcement, adding that the bidirectional cars in the program can deliver 10% of the flexibility to balance Utrecht’s wind-and-solar-generated electricity during peak times. Although the program is the first of its kind in Europe, similar programs are also underway in China, Japan, and Australia, Autoevolution writes.
Battery cell maker Envision Automotive Energy Supply Co. announced a work stoppage on Thursday of the construction of its manufacturing plant near Florence, South Carolina. “AESC has informed the state of South Carolina and our local partners that due to policy and market uncertainty, we are pausing construction at our South Carolina facility at this time,” spokesman Brad Grantham said in a statement, per the South Carolina Daily Gazette. The pause jeopardizes 1,600 new jobs and a planned $1.6 billion investment in the facility by the Japan-based company. The state’s Republican Governor Henry McMaster, a Trump ally, acknowledged that “the tariffs are going up and down” and some projects are “being paused,” but added, “Let things play out, because all of these changes are taking place. So, I’d say, relax if you can.”
Record-fast snowmelt in the western United States could be cueing up a particularly severe fire season, The Guardian reports. Despite some states, including California, seeing above-average snowfall this winter, all western states already have below-normal snowpacks, indicative of a rapid melt rate that the National Oceanic and Atmospheric Administration described in a recent special notice as “not normal.” Additionally, a third of the states in the West are in “severe” drought or worse, the highest proportion in more than two years. Combined with a forecast for above-average summer temperatures, the “quickly depleting mountain snows will limit summertime water availability in streams and rivers throughout the West, and may kick off a potential feedback loop that could intensify and expand the current drought,” The Guardian writes, singling out the Pacific Northwest as especially vulnerable to wildfires as a result.
A Ginko tree at the Miaoying Temple in Beijing. Kevin Frayer/Getty Images
A study of 50,000 trees in China found that thousands of endangered varieties have been preserved for centuries within the walls of religious sites and temples. “The researchers found that the density of ancient trees inside the temples was more than 7,000 times higher than those outside temples and in the wild,”Nature writes. Eight of the tree species identified by the researchers can only be found on temple grounds.
SpaceX has also now been dragged into the fight.
The value of Tesla shares went into freefall Thursday as its chief executive Elon Musk traded insults with President Donald Trump. The war of tweets (and Truths) began with Musk’s criticism of the budget reconciliation bill passed by the House of Representatives and has escalated to Musk accusing Trump of being “in the Epstein files,” a reference to the well-connected financier Jeffrey Epstein, who died in federal detention in 2019 while awaiting trial on sex trafficking charges.
The conflict had been escalating steadily in the week since Musk formally departed the Trump administration with what was essentially a goodbye party in the Oval Office, during which Musk was given a “key” to the White House.
Musk has since criticized the reconciliation bill for not cutting spending enough, and for slashing credits for electric vehicles and renewable energy while not touching subsidies for oil and gas. “Keep the EV/solar incentive cuts in the bill, even though no oil & gas subsidies are touched (very unfair!!), but ditch the MOUNTAIN of DISGUSTING PORK in the bill,” Musk wrote on X Thursday afternoon. He later posted a poll asking “Is it time to create a new political party in America that actually represents the 80% in the middle?”
Tesla shares were down around 5% early in the day but recovered somewhat by noon, only to nosedive again when Trump criticized Musk during a media availability. The shares had fallen a total of 14% from the previous day’s close by the end of trading on Thursday, evaporating some $150 billion worth of Tesla’s market capitalization.
As Musk has criticized Trump’s bill, Trump and his allies have accused him of being sore over the removal of tax credits for the purchase of electric vehicles. On Tuesday, Speaker of the House Mike Johnson described Musk’s criticism of the bill as “very disappointing,” and said the electric vehicle policies were “very important to him.”
“I know that has an effect on his business, and I lament that,” Johnson said.
Trump echoed that criticism Thursday afternoon on Truth Social, writing, “Elon was ‘wearing thin,’ I asked him to leave, I took away his EV Mandate that forced everyone to buy Electric Cars that nobody else wanted (that he knew for months I was going to do!), and he just went CRAZY!” He added, “The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts. I was always surprised that Biden didn’t do it!”
“In light of the President’s statement about cancellation of my government contracts, @SpaceX will begin decommissioning its Dragon spacecraft immediately,” Musk replied, referring to the vehicles NASA uses to ferry personnel and supplies to and from the International Space Station.