Seven of the largest Bitcoin mining companies in the United States are set to use nearly as much electricity as all the homes in Houston, the country’s fourth most populous city, according to a congressional investigation into the sector.
The findings, released last Friday, come at a time when Democratic lawmakers are calling for regulation and cryptocurrencies are increasingly criticized for overloading the power grid and driving up electricity prices for consumers.
In a letter to the Environmental Protection Agency and the Energy Department, a group of Democratic lawmakers led by Elizabeth Warren, a representative from Massachusetts, revealed that the seven companies have the capacity to use up to 1,045 megawatts of energy, or enough to power all the homes in Houston, a city of more than 2 million people.
“The results of our research, which collected data from only seven companies, are concerning, as this limited data reveals that cryptocurrencies are large energy consumers that account for a significant and rapidly growing amount of carbon emissions,” the lawmakers wrote.
The lawmakers also urged federal agencies to develop rules requiring cryptocurrency companies to report their energy use and greenhouse gas emissions, a first step toward understanding the scope of the problem and crafting regulation, according to note published in The Grist.
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Voracious Growth
The cryptocurrency industry has experienced explosive growth in North America. In 2021, China banned mining and the United States quickly became the global hub, with roughly a quarter of U.S. mining operations in Texas, where the power grid is notoriously fragile.
Mining cryptocurrencies like Bitcoin, a process that requires specialized computers to solve complex mathematical problems in exchange for new tokens, requires a great deal of computing power and consumes a lot of energy. Earlier this week, as a heat wave hit Texas, state regulators had to ask Bitcoin miners to voluntarily shut down their operations to avoid overloading the network.
According to The Verge, by 2026 cryptocurrency miners plan to increase demand on the Texas grid by 27 gigawatts, or about one-third of the grid’s current capacity. Bitcoin mining emits as much greenhouse gas as entire countries; one recent estimate said as much as the Czech Republic.
The burden that cryptocurrencies place on the power grid also drives up prices for other consumers. Last year, a study by researchers at the University of California at Berkeley and the University of Chicago found that cryptocurrency mining in upstate New York increased electricity costs for households in the region by a total of $165 million a year.
If you would like to read the letter sent by the congressmen, click here
