Bitcoin’s proof-of-work principle uses extreme amounts of electricity, contributing correspondingly high levels of CO2. Ethereum, a competing POW currency, is in the process of switching to proof-of-stake, one of more than 20 alternative methods of proof, and should be a model for bitcoin.

Bitcoin mining’s proof-of-work is so energy intensive that the computers used to perform the calculations individually consume 3.2 kilowatts of electricity on a 220v 30a circuit or as much as an electric clothes dryer, but unlike your cloths dryer, bitcoin miners run 24/7, 365 days a year.  That means that a single miner consumes 28 MWh (mega-watt hours) of electricity when a single MWh can power 400-800 homes for a year, depending on where in the US that home is located. A bitcoin mine can have any where from 10,000 miners for a small 30MW facility to over 300,000 in a 1GW facility like the one being built by Riot Blockchain in Navarro County, Texas.  For reference, 1GW is the same amount of electricity as generated by the average nuclear reactor in the US.

In February of 2021, a University of Cambridge analysis estimated that the total amount of electricity consumed by bitcoin mining was 121 TWh (1 terrawatt hour = 1,000 megawatt hours), midway between the electricity consumed by Argentina and Norway. However, more concerning about that study is that between 2015 and March of 2021, the amount of bitcoin energy consumed per year almost doubled every year for a just under 62-fold increase. This growth is already straining power grids here in the US as ERCOT (Texas power regulator) has 33 GW (as much as the entire state of New York sans mining) of new electricity requests for a grid that currently hits it peak of 80GW in summer heat waves. Texas rate payers will have to cover the costs of the expansion of their grid by more that 30% to meet this demand.

33GW = 7% of total US electricity consumption sans mining

But looking at the global carbon footprint highlights the problem with bitcoin mining that there simply isn’t enough renewable energy sources to power bitcoin mining as well as rest of the grid. To measure this, the University of Cambridge released the 3rd Global Cryptoasset Benchmarking Study in September of 2020 which concluded that the average carbon footprint of the electricity used for bitcoin mining globally was 837g CO2 / KWh where the average carbon footprint of all electricity in the USA  was around 530 g CO2 / KWh — meaning that if bitcoin miners were their own country, they would have been the fifth worst for consuming dirty electricity behind India and China and 14 places ahead of the US. Perhaps the best measure of how bad bitcoin mining is for the climate, an article in Nature concluded that for each $1 in bitcoin market value created was responsible for $0.35 in climate damages.

Sadly, there are numerous solutions to the problem with some more novel than others. Yet miners continue to cling to proof-of-work, even introducing new coins when the previous coin switched to proof-of-stake with crypto trade magazines even calling the practice of restoring proof-of-work as good news.

Read more about bitcoin mining’s electricity consumption here:

• Renee Choo, “Bitcoin’s Impacts on Climate and the Environment.” https://news.climate.columbia.edu/2021/09/20/bitcoins-impacts-on-climate-and-the-environment/
• Jeremy Hinsdale, “Cryptocurrency’s Dirty Secret: Energy Consumption,” https://news.climate.columbia.edu/2022/05/04/cryptocurrency-energy/
• Mora, C., Rollins, R.L., Taladay, K. et al. Bitcoin emissions alone could push global warming above 2°C. Nature Clim Change 8, 931–933 (2018). https://doi.org/10.1038/s41558-018-0321-8