74% of Bitcoin Mining Is Powered by Renewable Energy
A recent study, published by the cryptocurrency investment and research firm CoinShares, estimates that renewable energy powers roughly 74.1% of Bitcoin (BTC) mining operations.
The paper also indicated that Bitcoin (BTC) mining operations are often concentrated in areas where renewable energy sources are abundant. Miners are actually incentivized to do this because it is more profitable in the long term for them to use renewable energy in most cases.
However, it seems that renewable energy use in the industry is slightly down from last year, when roughly 77.8% of miners were using renewable sources.
According to the report:
“The renewables estimate is down from 77.8% in our November 2018 report and reflects increased visibility of the industry on our part as well as movements within the industry.”
If these numbers are correct, that would make the blockchain industry “more renewables-driven than almost every other large-scale industry in the world.”
In addition to these energy statistics, the report also suggests that the average miner is still making a profit, even during the prolonged bear market. According to the report:
“Among our findings is an estimate that since November, the market-average, all-in marginal cost of creation, at ¢5/KWh, and 18-month depreciation schedules has decreased from approximately $6,800 to approximately $5,600, mainly as a result of lower assumed cooling and overhead costs. This suggests that, at current prices, the average miner is highly profitable, with even older gear and high-cost producers currently able to make positive ROI.”
The paper also covered many other interesting trends, like the changes in the network’s average hashrate.
Energy Usage Concerns
Additionally, it is important to note that proponents of cryptocurrency insist that the technology consumes much less energy than the traditional banking and credit card companies.
It has even been calculated that Bitcoin mining uses less electricity annually than seasonal Christmas lights. Most of the large crypto mining operations are making significant efforts to reduce their carbon footprint.
Last year, Cryptosolartech, Spain’s largest Bitcoin miner, announced that they were building a 300 MW solar farm to power its mining operations.
In March of this year, the leading crypto mining startup Bitmain was reportedly planning to set up 200,000 units of mining equipment in areas of China that offer inexpensive hydroelectric power.