Bitcoin mining interests have called Watkins Glen officials in recent weeks to explore the possibility of setting up a cryptocurrency processing operation within the village to take advantage of its cheap electric rates.
The village enjoys a monthly allocation of about 6 megawatts of hydroelectric power that costs residents only about 4 cents per kilowatt, well under half the rate NYSEG charges.
Talks with the miners are at a preliminary stage, and there may not be any suitable sites, officials said. But the expressed interest prompted Schuyler County legislators to draft a resolution — tabled on April 12 — calling on the state Department of Environmental Conservation to issue statewide regulations for cryptocurrency mining.
Meanwhile, the village trustees recently voted 3-2 against a resolution calling for a moratorium on expanding Bitcoin mining operation at the Greenidge Generation power plant in Dresden.
The plant houses about 7,000 computer servers that validate and record Bitcoin transactions, using 19 megawatts of its total 106-megawatt capacity. The company is seeking local permits in Yates County to build four new buildings to add server capacity, and it has told potential investors that it expects its miners to draw 85 megawatts of power before the end of next year.
Local environmental groups have sued to try to block the expansion. They have warned that the increased power use will boost warm water discharges, which may promote toxic algal blooms. Furthermore, added energy use will raise air emissions, likely leading to conflict with the state law that calls for a 40 percent cut in greenhouse gas emissions by 2030.
Last week the law group EarthJustice and the Sierra Club warned that the DEC’s stance on Greenidge’s pending applications to renew its air permits would set an important precedent for nearly 30 other older fossil fuel power plants in New York State that could convert into energy-hungry Bitcoin mining or data center operations. With the price of Bitcoin more than doubling this year, conversions are particularly alluring.
A spokesman for Greenidge dismissed the concern EarthJustice and Sierra Club raised in a letter to the governor and DEC officials.
But in an application filed Thursday, a Canadian Bitcoin miner asked the state Public Service Commission to approve its planned takeover of a 55-megawatt natural gas-fueled power plant in North Tonawanda, just north of Buffalo.
If and when the deal closes, it would create the state’s — and perhaps the nation’s — second Bitcoin miner-owed power plant. Greenidge was first.
Digihost International, a British Colombia company, said in a Mar. 24 press release that it has agreed to buy the Fortistar plant for $3.5 million in cash and $750,000 in stock. Days later, it announced the purchase of 700 new mining machines.
The company already mines Bitcoin in Buffalo. It reported collecting 105 coins in the first quarter and said the new machines were expected to raise…