How much energy does Bitcoin use ? |
27/March/2022
|
All Currencies have a cost. Banks and Gold require electricity, Fossil fuel & staff. Bartering has the hassle of converting cows to fractions of houses plus remembering who owes what to who and maybe having to forcefully remind them when they conveniently forget.
As an environmentalist, bitcoins energy consumption & environmental impact is an issue close to my heart and as a Bitcoin miner & electrician I feel reasonably well qualified to guesstimate its energy consumption & environmental impact. I've found it uses way less energy than gold mining & banks but more importantly WAY less Green House Gasses !
As an environmentalist, bitcoins energy consumption & environmental impact is an issue close to my heart and as a Bitcoin miner & electrician I feel reasonably well qualified to guesstimate its energy consumption & environmental impact. I've found it uses way less energy than gold mining & banks but more importantly WAY less Green House Gasses !
Bitcoin power consumption = Total World Hash rate X Average J/THs of ASICs
This figure constantly changes due to variables such as -
- Hash rate
- Current BTC price
- Mining run on Hydro during the wet season, moved elsewhere during dry season
- The varied energy mix of all countries - According to the Bitcoin Mining Council Bitcoin global mining industry’s "sustainable" electricity mix had grown to approximately 58.5%
- Mining rig efficiency is always improving. The latest ASICs are 20.8 Joules / THash
- Older less efficient rigs become uneconomical or just wear out
Also there are also mitigating factors to be considered such as -
- Power that would be consumed anyway such as for space heating or heating a swimming pool
- Space heating also introduces a seasonal element, heating is turned off through summer.
- Mining on previously vented Methane converting CH₄ to CO₂ is actually reducing CO₂e Green House Gasses
- load switching agreements with power plants to turn off mining equipment when domestic demand is high, providing more incentive for over build on renewables.
- Newer more efficient machines are sure to be "tested" by the manufacturers before being sold.
Every ASIC ever produced
If we were to turn on EVERY single miner ever built - 100% of the time, we get a much higher energy consumption figure than is actually the case.
All makes and models of ASIC equipment have been listed (many thanks to "anonymous otter"). I added the estimated quantity of ASICs produced & multiplied it by the estimated up time the mines are in operation then matched it to the current total hash rate. This can then be used to approximate the average hash efficiency.
New mining gear will be driven hard, then sold when less profitable to amateurs, home miners, hobbyist & home / business heating. A brand new mine in an industrial mining unit would have much more up time say 98% than an amateur using a 5 year old ASIC for heating say 30%.
Mining equipment varies in performance-
All makes and models of ASIC equipment have been listed (many thanks to "anonymous otter"). I added the estimated quantity of ASICs produced & multiplied it by the estimated up time the mines are in operation then matched it to the current total hash rate. This can then be used to approximate the average hash efficiency.
New mining gear will be driven hard, then sold when less profitable to amateurs, home miners, hobbyist & home / business heating. A brand new mine in an industrial mining unit would have much more up time say 98% than an amateur using a 5 year old ASIC for heating say 30%.
Mining equipment varies in performance-
- amazing performance yet to be released may be being "tested" by the manufactures
- Newly released
- Older less profitable
- Obsolete
- Hashing for non Bitcoin networks.
This spreadsheet contains my best guesstimate as to Bitcoins energy consumption & subsequent Green House Gas emissions, then compares them to emissions from -
- Banking sector / fiat emissions
- Gold mining
- Military Industrial Complex
- Agriculture
- The World 52,000 GtCO₂
As you can see above - If Bitcoin replaces just banks and Gold, Green House Gases could be considerably reduced, then add in banking investments & a reduction in the Military things get really interesting !
Bitcoin cost per transaction
Fiat needs constant growth - Bitcoin incentives thrift !
This simple changing of incentives could rewire the human psyche. People become incentivised by thrift rather than consumption. The benefit of de-growth to the climate cause could be immeasurable.
The Cantillion Effect
The closer you are to the money printing press the richer you are likely to be. Why is it that we can buy beans grown in Africa, picked - put in a plastic package - ship round the world, cheaper than growing in our own gardens in the US/UK ? Or minerals mined cheaper than in our own countries?
Simple
Simple
Start
The developed world has all the stuff. The undeveloped world has lots of rapidly devaluing paper money. We are resource rich they have little. Not only is it the biggest scam ever invented it has many negative effects-
What would be the Green House Gas reduction in ending the West’s money printing scam ? |
Where does Bitcoins energy go ?
Bitcoins power consumption serves three purposes
No more bailouts ! The real cost of Banks.
- Mining new coins 96% (Like mining gold out of the ground)
- Performing transactions 4% (Like melting, verifying /distributing gold bars and coins)
- Blockchain nodes almost 0% (Like an accounting ledger)
No more bailouts ! The real cost of Banks.
Bitcoin & Technology.
In the future Technological improvements will increase the hash rate, and not so much brute Wattage.
2009
In 2009 you could mine on a regular PC
97 W/MHs |
2022 - Bitmain S19 XPMining now is only profitable on dedicated hardware such as a Bitmain S19j ASIC (Application Specific Integrated Circuit) 3030 Watts
21,500,000 W/MHs. Cost $10,000 |
Roughly 39,000 tonnes of ASIC mining machines have been manufactured in total. Approximately half of that mass is still in use. If these replace heating units, much of this could be offset by not manufacturing boilers, storage heaters etc.
Bitcoin & ESG (Environmental Social Governance)
Unexpected Benefits
|
Other Benefits
Imagine one of these Bitcoin mining units connected to your local swimming pool, subsidising financially & heating the water, but also load balancing the grid.
|
10 REASONS BITCOIN IS GREEN
- Much of Bitcoins energy is derived from "sustainable" sources (58%).
- Bitcoin does not invest. Banks have invested huge amounts in Oil & Gas.
- Bitcoin (Money that increases in value) encourages people to save not consume.
- Printed money tends to go to pay for big ticket items such as The Military, Nuclear Power stations, Coal fired Power stations.
- Bitcoin Incentivises renewables. Previously, excess renewable capacity was switched off, now it can be sold to Bitcoin mining farms.
- Second use of heat from Bitcoin mining can be used for space heating.
- Previously vented Methane can power Bitcoin mining, converting it to CO₂ a much less potent green house gas.
- Low/Negative interest rates in paper money encourage spending beyond peoples means I.E. borrowing to buying property as a speculation, which in turn push up property prices beyond the savers ability to pay. Increased property prices encourage more borrowing against property thats risen in value feeding the loop. The result is savers loose out. Thriftiness is discouraged.
- The initial mining "gold rush" may be over. Mining may not be as profitable as simply holding any more. With only approx 2m bitcoins left to mine it may be just as easy to buy.
- When all coins are minted by the year 2140 approximately mining should decrease significantly.
Second use of the heat
Heat is a by product of Bitcoin mining. The heat from 1 modern ASIC is typically 1.4 - 3.3kW & can be used to heat homes & businesses. Use Green electricity and you have a Zero emissions heater that makes MONEY ! Electricity is converted too heat, it doesn't care if its £50 heater or £7500 ASIC the result is the same. Currently Bitcoin consumption is capable and in many cases is - heating up to 3 Million homes.
Bitcoin incentivises Green energy !
Giving a very useful outlet for excess wind, solar (see Sunexchange) and hydro power. In the UK and Germany people are actually PAID TO CONSUME excess wind power, imagine getting paid twice to use power!
In the UK Octopus Energy Agile tariff can go to -3p /kWh. The mining equipment does not need to run 24/7 and can be quite happily turned off when little renewable energy is available. Load switching/ balancing is hugely advantageous to renewables.
In the UK Octopus Energy Agile tariff can go to -3p /kWh. The mining equipment does not need to run 24/7 and can be quite happily turned off when little renewable energy is available. Load switching/ balancing is hugely advantageous to renewables.
Emissions are also entirely dependent on electrical carbon intensity. The average UK carbon intensity for 2020 was 181gCO2 /kWh.
Bitcoin vs Gold
The Gold industry produces 126MT CO₂ Annually
Gold mining =
In 2013 it took 25.8 gallons of Diesel to produce 1 ounce of gold ! Bitcoin tends to use the cheapest electricity which is usually the greenest EG excess power from
|
Bitcoin vs the Dollar & Banks
How do we add all the emissions that have gone into the "Petro" Dollar Pound or Yen ? Should we factor in emissions of the oil industry, the military & manufacturing? Bitcoin currently has 1/3 of the Banks emissions before factoring other variables.
|
These 38 Fossil Banks are among the biggest financiers of the fossil fuel industry. A handful have adopted policies excluding or restricting financing for some parts of the industry, but none have yet committed to stop funding fossil fuels altogether.
|
Stranded EnergyIn the Oil and Gas industry, previously “stranded” energy in the form of Methane has been flared or worse, vented. Methane is 86 x more potent Greenhouse Gas than CO₂. Now the gas is being increasingly used for bitcoin mining. Burning the gas efficiently to produce electricity is a net climate positive as long as its using existing flares and Vents. This has huge potential for CO₂e Reduction of the Oil & Gas industry !
Ironic that the Oil & Gas industry could be self incentivised to clean up it own mess. EXON Mobil trail mining bitcoin. How Bitcoin Mining Is Disrupting Global Energy Markets |
Buying vs Mining
As the price rises will Bitcoins energy consumption rise ?
I think we may actually be at peak mining energy consumption for the following reasons.
In the early days the mining reward was much greater ( 50BTC ) so was worth the investment, but now if you are a company like Bitmain looking to invest in Research & Development to bring the next generation of ASIC to market, would you employ staff, buy machinery costing millions$ or simply buy & hold and go on holiday and make FAR MORE money?
I do not see a huge increase in mining energy consumption and quite possibly a reduction. ASIC mining gear is fetching highly inflated prices at the moment. Some people may actually sell there gear to invest in the coin its self. Hash rate may increase as old slow ASICs are replaced for new ones. Major innovations from Bitmain or anyone else seem a long way off at the moment.
- Mining equipment has got really expensive - $11,620 for Bitmain S19 xp
- Typically Bitcoins value increases roughly 140% every year ! Compound interest rates on steroids !
- Instead of investing in mining equipment, wages, electricity over the next few years, with a rapidly rising price it may simply be much better investment to simply buy BTC IMMEDIATELY .
- Research & development for the next generation of ASIC's is even more expensive than mining.
In the early days the mining reward was much greater ( 50BTC ) so was worth the investment, but now if you are a company like Bitmain looking to invest in Research & Development to bring the next generation of ASIC to market, would you employ staff, buy machinery costing millions$ or simply buy & hold and go on holiday and make FAR MORE money?
I do not see a huge increase in mining energy consumption and quite possibly a reduction. ASIC mining gear is fetching highly inflated prices at the moment. Some people may actually sell there gear to invest in the coin its self. Hash rate may increase as old slow ASICs are replaced for new ones. Major innovations from Bitmain or anyone else seem a long way off at the moment.
Bitcoins Environmental impact Conclusion
If you really want to be green shut down -
Bitcoin could do that without a shot being fired, how green is that ?!
- Military Industrial Complex
- Gold mining
- Banks !
Bitcoin could do that without a shot being fired, how green is that ?!
Other Related Articles Links
This survey by University Of Cambridge shows Bitcoin is powered by 39% renewables but rather confusingly talks about Bitmain Antminer S5 & S7 (2015 out of date mining hardware)
https://www.jbs.cam.ac.uk/faculty-research/centres/alternative-finance/publications/3rd-global-cryptoasset-benchmarking-study/
Miner Daily
Moore’s Law vs Bitcoin ASICs and Network Growth
https://minerdaily.com/2021/moores-law-vs-bitcoin-asics-and-network-growth/
Green Bitcoin: Miners Demand Cleaner Energy
https://minerdaily.com/2021/green-bitcoin-miners-demand-cleaner-energy/
https://www.jbs.cam.ac.uk/faculty-research/centres/alternative-finance/publications/3rd-global-cryptoasset-benchmarking-study/
Miner Daily
Moore’s Law vs Bitcoin ASICs and Network Growth
https://minerdaily.com/2021/moores-law-vs-bitcoin-asics-and-network-growth/
Green Bitcoin: Miners Demand Cleaner Energy
https://minerdaily.com/2021/green-bitcoin-miners-demand-cleaner-energy/