Syracuse, N.Y. – By next year, owners of a gas-fired power plant on Seneca Lake hopes to be producing enough electricity to power 85,000 homes.
But much of that electricity won’t turn on lights in living rooms. It will instead stay on site at the plant in Dresden, powering up to 27,000 computers that will run 24 hours a day to snag increasingly rare virtual currency called bitcoin.
The plant worries climate change activists, who say the extraordinary amount of energy consumed in what’s known as bitcoin mining will make it hard for New York to meet its aggressive climate change goals.
“We’re talking about burning more fossil fuels to make fake money in the middle of climate change, which we view as insane,” said Yvonne Taylor, vice president of the environmental group Seneca Lake Guardian.
The Greenidge Generation Holdings plant is part of a growing trend. Lucrative cryptocurrency centers gobble up huge amounts of energy, so much so that they take over power plants or old factories to use for themselves. Several have already set up shop in Upstate New York, where energy is cheap and cold weather reduces the cost of cooling thousands of computer processors, each of which emits as much heat as a 1,400-watt hair dryer.
New York will have to grapple with the surging demand of bitcoin mining if the state expects to meet to slash greenhouse gas emissions, said Tristan Brown, a professor of sustainable resources management at SUNY College of Environmental Science and Forestry.
“Bitcoin does raise some interesting questions,” Brown said. “Is this something we necessarily want to have contributing to our (electrical) demand? What type of value does it bring the state economically? That’s ultimately what state policy will have to determine.”
While those questions are being debated, legislators in both houses are introducing bills that would impose a three-year moratorium on cryptocurrency mining.
“The continued and expanded operation of cryptocurrency mining centers will greatly increase the amount of energy usage,” reads the Senate bill, sponsored by Assemblyman Kevin Parker, D-Brooklyn. “It is reasonable to believe the associated greenhouse gas emissions will irreparably harm compliance with the Climate Leadership and Community Protection Act.”
Assemblywoman Anna Kelles, D-Ithaca, plans to introduce the Assembly version of the bill this week.
The largest cryptocurrency mining operation in the world is in the former Alcoa Aluminum smelter in Massena, according to its owner, Coinmint. A British Columbian company filed an application in April to buy a 55-megawatt gas power plant just north of Buffalo and turn it into a bitcoin mining operation.
This is just the beginning, environmental groups Earthjustice and the Sierra Club wrote to New York regulators in early April.
“The Greenidge power plant is one of nearly 30 power plants in upstate New York with the potential to be converted to full-time operation for bitcoin mining and other…