Despite the propaganda, the share of renewable energy used to secure the Bitcoin network is increasing at the rate of 6% per year.
Bitcoin, how much renewable?
Greenpeace’s recent crackdown on bitcoin shows that clichés about bitcoin die hard. In their defense, it is true that a certain vagueness surrounds the elusive bitcoin mining industry scattered around the world.
Indeed, only two (discordant) sources existed about its carbon footprint. Those of the Bitcoin Mining Council and the Cambridge Center for Alternative Finance.
The first estimates that 59% of the electricity used to secure the Bitcoin network comes from carbon-free energy sources. The second puts forward a much lower figure of 37%.
This gaping gap was not to appease the debate, so Daniel Batten got down to the task by contacting 98% of minors. We now have solid, complete and up-to-date data.
Verdict: bitcoin’s share of renewable energy is around 53%:
Bitcoin has increased its sustainable energy mix by 6.2% per year since January 2020.
-The growth rate of 6.2% is faster than that of any major industry.
-52.6% sustainable energy mix is more than any major industry. »
Cambridge’s mistake is to make no difference between miners connected to the national grid and those that are off-grid (mainly consuming renewable energy).
The Bitcoin Mining Council, for its part, embellishes its figures by assuming that half of the miners (those who do not respond to its survey) consume electricity as carbon-intensive as that of the United States.
Ultimately, it emerges that coal is not the main source of electricity for the Bitcoin network, but hydraulics (23%).
Miners such as OceanFalls, Blockfusion, Hut8, Iris, Sato, Terawulf, Gridshare or the French Big Block Green Service are examples of companies operating 100% or mainly with hydropower.
According to the report According to D. Batten, the second most important source of renewable energy is wind energy. It now represents almost 14% of all the power injected into the Bitcoin network.
Who mines on coal?
Person. Bitcoin, like electric cars, does not directly emit CO2. Its emissions depend on the energy mix of the electricity network.
We could make the analogy with the electric car that runs on coal… Currently, assuming that electric cars are proportionally distributed in the world, coal would be their main source of energy (37%), followed by gas (23 %).
The difference between electric cars and miners is that they are not 100% dependent on national power grids. Many miners are near isolated sources of electricity that would otherwise be wasted. Usually hydraulics.
Nearly 50% of minors are in the United States
American miners consume 53% renewable energy. That’s as much as the global average for the bitcoin mining industry.
Nevertheless, the CO2 emissions of American miners are much lower than those of miners in the rest of the world. For what ?
First, because Americans use more gas than coal when it comes to their carbon-based electricity sources.
In addition, some US miners consume gas (methane) that would otherwise be released into the atmosphere or flared. This results in an attenuation of greenhouse gas emissions offsetting the emissions of the entire BTC mining industry.
Of the 13.6 million tonnes of CO2 equivalent generated by US miners each year, 1.8 million tonnes are offset.
Clearly, the United States represents 47% of the hashrate (and therefore 47% of electricity consumption), but only generates 39% of CO2 emissions.
According to this report, globally, bitcoin’s global net emissions are currently 29.7 million tonnes of CO2 equivalent per year. Down 6% compared to January 2020.
Let’s finish by specifying that Satoshi’s protocol halves the incentive to mine every four years (halving). Not to mention the efficiency of ASICs, which increases very quickly and reduces electricity consumption accordingly.
In sum, the energy efficiency of bitcoin will continue to increase and competition will mechanically push miners towards otherwise wasted non-carbon energy sources. The proposed 30% tax on American miners could greatly speed up the process.
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