Hydropower Answer to ‘Power-thirsty’ Bitcoin Mining

Tesla-chief’s rebound from the Bitcoin frontlines, seemingly on account of increasing carbon footprint, has caused the issue of bitcoin mining to be taken with greater seriousness than ever before.

Carbon footprint is the measure of the total volume of greenhouse gas (including Carbon dioxide and methane) emissions from daily activities by individuals, events, organizations, products, places, and services.

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Determining or calculating the carbon footprint of industry, product, or service is a complex task. Life-cycle assessment (LCA) is an instrument used by industries to measure carbon footprint. Here carbon footprint may be one of many factors taken into consideration when assessing a product or service. The International Organization for Standardization has a standard called ISO 14040:2006 that has the framework for conducting an LCA study. ISO 14060 family of standards provides further sophisticated tools for quantifying, monitoring, reporting, and validating or verifying GHG emissions and removals. Another method is through the Greenhouse Gas Protocol, a set of standards for tracking greenhouse gas emissions (GHG) across scope 1, 2, and 3 emissions within the value chain.

Industries With the Highest Carbon Footprints

The primary sources of greenhouse gas (GHG) emissions are:

Transportation – produced to 29 percent of 2019 greenhouse gas emissions. This sector generates the highest share of greenhouse gas emissions. GHG emissions from transportation mainly come from burning fossil fuel for our cars, trucks, ships, trains, and planes. Over 90 percent of the fuel used for transportation is petroleum-based, chiefly, gasoline and diesel.

Electricity production – made up for 25 percent of 2019 greenhouse gas emissions. The major share of electricity is generated from burning fossil fuels, mostly coal and natural gas.

Industry – puffed up 23 percent of 2019 greenhouse gas emissions. Greenhouse gas emissions from industry mainly come from the combustion of fossil fuels for energy, as well as greenhouse gas emissions from certain chemical reactions necessary to produce goods from raw materials.

Residence and Commerce – produced up 13 percent of 2019 greenhouse gas emissions. The emissions from businesses and homes arise chiefly from fossil fuels burned for heat, the use of certain products that contain greenhouse gases, and the handling of waste.

Agriculture – made up 10 percent of 2019 greenhouse gas emissions. The emissions from agriculture come from livestock such as cows, agricultural soils, and rice production.

Crypto Industry

There is another section of the industry that is currently under the scanner, and the screams are getting louder to arrest the surge.

Bitcoin – the world’s biggest cryptocurrency has a coal connection. The bitcoin that once was only a fringe asset class has transitioned into a mainstream financial instrument with its increasing acceptance in major US establishments.

Mining involves a disparate network of powerful computers, called rigs, working 24X7, struggling to solve a hashcode – an energy-intensive process to mine the coins. A number of these pit against each other to come up with a solution in the fastest possible time to earn rewards in Bitcoins. This practice uses a huge amount of fuel to generate electricity to power the systems. Thus leading to increasingly higher GHG emissions.

Bitcoin mining generates anywhere between 22 and 22.9 million metric tons of carbon dioxide emissions a year. Or, between the levels by Jordan and Sri Lanka, a 2019 study in the scientific journal Joule.

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Green Bitcoin

There were people who identified the red flags when the industry grew in wild swings. There is a growing consciousness in the industry and efforts are underway to mitigate the environmental damage by incentivizing ‘green Bitcoin’ using renewable energy.

Sustainability experts opine that could buy carbon credits to compensate for the impact. Blockchain analysis firms claim that it is theoretically possible to track the source of Bitcoin. Therefore, making it possible for mining firms to charge a premium for each green Bitcoin.

Renewable Energy Resource

Projects from North America are striving for ways to lure bitcoin mining away from burning fossil fuels. Alternatives such as using hydropower to reduce its carbon footprint. Moreover, makes the currency more ethical to mainstream investors.

Some hope to repurpose the heat generated by the mining to benefit agriculture, heating, and other needs, while others are tapping power generated by flare gas (a by-product from oil extraction usually burned off) for crypto mining.

China Crises

China leads the world in mining Bitcoins. Cheap fossil fuels power giant rigs that account for over 70% of the mined coins. The sudden closure of mining farms in China’s Inner Mongolia province has visibly shaken the world of crypto. The billions invested by corporate houses and financial institutions would suddenly be at stake should China suddenly pull the shutters on these prolific mining farms.

They tend to use renewable energy – mostly hydropower – during the rainy summer months, but fossil fuels – primarily coal – for the rest of the year.

Hydroelectric Power

As the chunk of the world’s hashing power migrates to North America. Investors shift focus towards harnessing the continent’s hydroelectric grid as a source of energy for bitcoin mining. Additionally, the continent is home to oodles of orphaned power. Therefore, the products of economic shifts in the mature economies of the USA and Canada. While residents are migratory, and boomtowns lose importance, functional grids last for more than a lifetime.

Renewable energy sources are being seriously considered in multiple upcoming projects in the region. While hydropower tops the list, wind, solar, geothermal, and nuclear power are just about to replace fossil fuel energy.

Final Words

Tesla-chief’s rebound from the Bitcoin frontlines. Therefore, seemingly on account of the increasing carbon footprint is of greater seriousness than ever before.