Crypto miners' power demand boosts Texas infrastructure

A top trade group said that the rise in miners' power demands has not hindered the growth of Texas in Texas due to the bankruptcies and worries over electric power consumption.

According to Lee Bratcher, president of the Texas Blockchain Council, said miners consume about 2,100 megawatts of the state's power supplies. Bratcher said that power usage increased by 75 per cent last year and was nearly triple that of the previous 12 months.

According to the grid operator Electric Reliability Council of Texas ERCOT There has been some challenges with the mining industry as a result of two prominent bankruptcies and other miners scaling back expansions, according to data from Bratcher's group.

The industry is facing new federal regulations, including a proposed 30 per cent tax on electricity usage for digital mining, and calls from the U.S. Treasury secretary and commodities regulator for a regulatory framework.

New York City imposed a ban on some criptocurrency mining that runs on fossil fuel-generated power. Some counties in Texas offer tax incentives and miners can be drawn to its wind and solar power, which could supply nearly 39 per cent of ERCOT's energy needs in 2023.

According to Matt Prusak, chief commercial officer at U.S. Bitcoin Corp., which has one of its mining operations in a 280 megawatt wind farm in Texas, is a very energy intensive business, which makes it very hard for people to find places like West Texas full of miners.

Its McCamey, Texas site last month consumed 173,000 megawatt hours of power, about 60 per cent of which is provided by the grid and nearly 40 per cent from the nearby wind farm. The Energy Information Administration says that the average American home uses about 10 MWh a year.

The prospect of higher demand for cryptocurrencies has raised alarms in Texas, where about 250 people died during a winter storm blackout that exposed the fragility of the state's grid.

Joshua Rhodes, a research scientist at the University of Texas at Austin, said there are a lot of Bitcoin mines that are trying to connect to the system. If all of them were to connect in the timelines they were looking to connect, it would probably present an issue to the grid, because that load would be growing faster than ever before.