THE ENERGY BOMB

The report examines the rapid growth of proof-of-work cryptocurrency mining in the U.S. following China's 2021 ban. It argues that the industry's high energy demands drive the revival of defunct fossil-fuel power plants, increase greenhouse gas emissions, and place financial burdens on electricity ratepayers. The document also details local harms, including noise and water pollution, and debunks industry claims regarding sustainability and grid stability.

• Following China's 2021 ban on cryptocurrency mining, the United States became a primary hub, with an estimated 38% of Bitcoin mining activity based there as of August 2022.
• Bitcoin mining in the U.S. is estimated to have caused between 11 to 76 million annual excess tons of CO2, with a central estimate of 27.4 million tons, which is approximately three times the emissions of the largest U.S. coal plant in 2021.
• Cryptocurrency miners often prioritize rapid access to energy over cost, leading to the reactivation of defunct or uneconomic fossil-fuel plants. Examples include the Hardin coal plant in Montana, which saw an 800% increase in CO2 emissions in one year, and the Merom coal plant in Indiana, whose retirement date was postponed.
• The industry utilizes four primary electricity procurement methods: behind-the-meter generation at power plants, power purchase agreements (PPAs), retail grid purchases, and combusting fossil gas at oil and gas wells.
• Mining operations cause significant local environmental harms, including noise pollution described by residents as sounding like 'jet engines,' thermal pollution in water bodies, and the generation of massive amounts of electronic waste, estimated at over 30,000 metric tons in 2021.
• Electricity ratepayers often bear the cost of infrastructure upgrades required by miners. For instance, the Nebraska Public Power District spent $17.6 million on a transmission line and substation for Compute North, and Big Rivers Electric plans to spend $12.7 million for Blockware Mining in Kentucky.
• The report argues that industry claims of sustainability are often 'greenwashing,' noting that co-location near renewables does not guarantee the use of that energy and that unbundled Renewable Energy Certificates (RECs) do not provide incremental climate benefits.
• The claim that mining uses 'wasted' curtailed energy is deemed unrealistic because curtailment is sporadic; in California in 2021, curtailments above 200 MW occurred in only 15% of hours, making 24/7 profitable operation impossible on curtailed energy alone.
• Cryptocurrency mining creates very few long-term jobs relative to its energy use. Examples include the Blockware Mining operation in Kentucky providing only 10 full-time jobs and the Greenidge operation in New York employing 5 union workers on site.
• In Texas, the influx of mining operations threatens grid stability. ERCOT estimated that by August 2022, 33 GW of cryptocurrency mining operations had applied to connect, which represents 41% of ERCOT's record peak demand.

APA

DeRoche, M., Fisher, J., Thorpe, N., & Wachspress, M. (2022). THE ENERGY BOMB. Earthjustice. https://earthjustice.org/sites/default/files/files/energy_bomb_bitcoin_white_paper_101322.pdf

Chicago

DeRoche, Mandy, Jeremy Fisher, Nick Thorpe, and Megan Wachspress. THE ENERGY BOMB. Earthjustice, 2022. https://earthjustice.org/sites/default/files/files/energy_bomb_bitcoin_white_paper_101322.pdf.

Wikipedia

{{cite report |last1=DeRoche |first1=Mandy |last2=Fisher |first2=Jeremy |last3=Thorpe |first3=Nick |last4=Wachspress |first4=Megan |title=THE ENERGY BOMB |publisher=Earthjustice |date=September 2022 |url=https://earthjustice.org/sites/default/files/files/energy_bomb_bitcoin_white_paper_101322.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{deroche2022energy, author = {DeRoche, Mandy and Fisher, Jeremy and Thorpe, Nick and Wachspress, Megan}, title = {{THE ENERGY BOMB}}, institution = {Earthjustice}, year = {2022}, month = sep, url = {https://earthjustice.org/sites/default/files/files/energy_bomb_bitcoin_white_paper_101322.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }