Introduction
During the volatile 2021 bull market, mining companies took on substantial loans to invest in equipment and infrastructure, only to face bankruptcy when the market crashed. Now, with the bear market persisting and low profits, miners are looking to alternative energy sources to reduce costs, increase profitability, and lower their environmental impact.
Renewable Energy Sources
Bitcoin-focused financial services company Swan Bitcoin reports that miners using renewable energy sources are seeing significantly lower costs. While the average rate to mine one Bitcoin is around $26,000, those utilizing renewable energy are achieving rates between $5,000 and $15,000 per Bitcoin. Riot Blockchain, a US-based publicly traded mining company, stated that wind and solar energy in Texas have helped them achieve some of the lowest mining costs, at $8,389 per Bitcoin.
Sustainable Industry
Data from the Bitcoin Mining Council suggests that the mining industry is becoming more sustainable. According to the council, 59% of mining operations are carbon-free, with that number growing at a rate of almost 4.5% per year. Mining providers like Sazmining are utilizing excess hydroelectricity in Wisconsin and Paraguay, while others are exploring the use of ocean thermal energy to power their operations.
Long-Term Success
Miners are increasingly focused on long-term success and are choosing to shift towards alternative energy sources. Cryptocurrency mining infrastructure provider Sabre56 is working with numerous mining companies to set up machines across its three facilities in Wyoming and Ohio. Their facility in Gillette, Wyoming, known as "Bonepile," utilizes a combination of energy sources, including renewables, such as wind, recovered energy, and hydro, accounting for almost 29% of their energy mix. This facility is designed to minimize overheating and strain on the mining equipment.
Unlocking the Potential of Ocean Thermal Energy
OceanBit is taking a unique approach by integrating Bitcoin mining into its ocean thermal energy power plant design. This renewable energy source, utilizing temperature differences in ocean water, has the potential for global adoption. By combining the cooling capabilities of Bitcoin mining equipment with the low-grade heat produced by the mining process, the efficiency of both processes can be increased while reducing costs.
Controversial Energy Sources
Pennsylvanian mining company Stronghold Digital Mining is utilizing coal refuse, the byproduct of the coal mining refining process, to power its operations. This waste has been a significant contributor to water and air pollution in Pennsylvania. However, Stronghold is working with local authorities to clean up the waste coal piles and convert them into power through specialized facilities.
Conclusion
The current bear market has prompted miners to seek alternative energy sources to reduce costs and increase profitability. From renewable energy to ocean thermal energy and even controversial sources like coal refuse, miners are exploring various options to ensure their long-term success in the face of market volatility.
