Some of Bitcoin’s most prominent proponents have tried to demonstrate Bitcoin’s environmental performance in a joint paper by researchers at finance company Square and investment manager Ark Invest, which argues that mining Bitcoin can lead to more efficient renewable energy production.
A document written by The Bitcoin Clean Energy Initiative, or BCEI, seeks to refute the claim that “the account needed to protect bitcoins is […] damaging the environment and destroying the planet,” arguing that bitcoin mining stimulates generating electricity “from renewable carbon-free sources.” … ”
The newspaper has received backing from well-known coded personalities, including Jack Dorsey Square, Tesla’s Elon Musk, and Ark Invest’s Katy Wood.
On April 22, Twitter Square claims that while solar and wind power can produce cheaper energy than fossil fuels, these renewables tend to cause overconsumption when demand is low and, conversely, struggle to meet the needs of consumers and industry when demand is high. … …
According to the researchers, the problem of various renewable energy production and electricity demand could be reduced by creating an ecosystem in which solar / wind power, batteries and bitcoin mining exist to form a green network that runs almost exclusively on renewable energy sources.
“This is not only possible, but it can be done without compromising the profitability of the sector.”
The document describes the bitcoin mining sector as the “last energy buyer”, which can be located anywhere in the world.
While solar and wind energy costs between half and about a third of fossil fuels per kilowatt hour, the paper points out that geographic constraints on renewable energy plans usually mean energy supplies are “either oversupplied or not available.”
“The end result is strength that far exceeds what society normally requires by a few hours a day, and this is not enough when the demand is high. This problem also manifests itself depending on the season. ”
By combining Bitcoin mining with renewable energy storage, the document argues that battery limitations and energy dissipation can be compensated for by channeling excess power into mining. If miners could only capture 20% of the wind and solar energy trapped in the US power grid, the BCEI estimates, global mining capacity could triple.
Mobilizing miners as electricity buyers will ultimately also increase the profitability of the renewable energy sector by giving producers the opportunity to “balance electricity prices with bitcoin prices.”
“In a sense, the unrestricted appetite of the miners allows them to eat what’s left” of the duck. Given these advantages, we believe it makes sense for all storage hardware developers to expand their current battery offerings with bitcoin miners.
The document also confirms that the costs associated with expanding the use of renewable energy sources will fall rapidly.
“The bitcoin and energy markets are converging and we believe that today’s energy product owners are more likely to become miners in the future,” she said.
Not everyone is convinced of the BCEI’s assurances, but renowned analyst Matthey Greenspan describes the report as “justifying Bitcoin’s massive energy consumption.”
Rather than offering a solution to Bitcoin’s ever-increasing energy consumption, Greenspan describes the BCEI document as a blueprint for a “power-hungry feedback loop.”
“The focus of this article is not so much on finding solutions, but on justifying Bitcoin’s huge energy consumption and painting a rosy picture of how this will positively impact the clean energy sector,” Greenspan said.
Earlier this year, researchers at the University of Cambridge calculated that Bitcoin uses 121.36 terawatt hours per year, placing the network among the 30 largest energy consumers in the world and in Argentina.