What is the share of renewable energy in Bitcoin mining? This is the question that a study coordinated by Daniel Batten wanted to answer. After extensive surveys of mining players around the world, it was found that more than 52% of the energy used by Bitcoin miners is decarbonized. This use of renewable energy is growing by nearly 4.5% each year. Shortly before this study, the Cambridge Center for Alternative Finance (CCAF) and the Bitcoin Mining Council (BMC) had already conducted similar studies with different results.
Bitcoin is green and moving in the right direction
It’s a fact: Bitcoin mining consumes a lot of energy. And it’s not the only energy-intensive industry. Nevertheless, the share of renewable energy in Bitcoin mining is still a matter of debate. The study conducted by Daniel Batten provides a well-documented answer. CEO of ClimateTech VC, Daniel Batten is the author of the brilliant book “How to Change the World with One Pitch”.
The data provided by Daniel Batten’s study informs that the majority of Bitcoin mining is done with renewable energy. Indeed, 52.2% of the energy used for Bitcoin mining is zero-emission. Moreover, the share of renewable energy use is growing rapidly in the Bitcoin mining industry. Each year, the Bitcoin network increases its share of renewable transition by 4.49%. If this pace is maintained, Bitcoin mining could be completely decarbonized within a few years.
Moreover, Bitcoin mining does not rely predominantly on coal. Many actors like GreenPeace routinely say otherwise. Rather, according to Daniel Batten’s study, the Bitcoin network is one of the few industries that rejects coal as a primary energy source.
The overall zero-emissions energy figure provided by Daniel Batten‘s study is lower than the BMC’s findings. It is also much higher than the alarmist data from the Cambridge Center for Alternative Finance CCAF. This difference in results is in fact linked to the methodology used.
Why are the results different from those of the CCAF and the BMC?
So far, two major institutions have already conducted studies on the energy consumption of Bitcoin. Cambridge Center for Alternative Finance (CCAF) is an independent center attached to the University of Cambridge. Its study estimates the share of renewable energy in Bitcoin mining at 37.6%.
Then, a group of mining industry entrepreneurs, the Bitcoin Mining Council (BMC), put the share of renewables in mining at 59.4%.
The difference in the new study’s data with those of the two former studies is related to methodological approaches, among other things.
Indeed, the study of the Cambridge Center for Alternative Finance (CCAF) does not take into account the miners installed “off-grid”.
Our estimates do not include activities that could reasonably be expected to reduce emissions, such as the use of flare gas, off-grid (behind the counter) Bitcoin mining.CCAF
Because of the importance of off-grid mining, the omission of miners from this category can only affect the results of a study. Indeed, 52.8% of Bitcoin mining is done off-grid. Moreover, off-grid energy is mostly decarbonized. Up to 65.5% of off-grid mining comes from renewable energy. The addition of off-grid mining players in the new study justifies the difference in its results from the CFAC study. It also makes it more interesting and credible.
For its part, the Bitcoin Mining Council obtained its figures based on an extrapolation of the mining figures in the United States. Indeed, the BMC‘s study is based solely on the figures provided by North American miners. They represent only 46% of Bitcoin mining, so this calls into question the veracity of its results. Thus, the new study seems to remedy the challenge of estimating the reality of the field as closely as possible.
The estimates provided by Daniel Batten’s new study are still not ideal. In particular, complete information on mining in Kazakhstan and China is missing. Nevertheless, this one seems closer to reality because of its more comprehensive methodological approach. The detractors of mining should know: Bitcoin mining is mostly green. Saying so is not the same as denying the current climate emergency. It’s just a call to direct climate advocacy to the right actor. It’s the politicians who still allow polluting energies like coal, which is the world’s main source of electricity (36.7%), to thrive.
I dream of a world where every citizen has total control over themselves, including their finances. I believe that Bitcoin is one of the tools that will achieve this revolution. Since 2019, I am learning about this cryptocurrency and spreading the word around.