The pause of obscurity. A watt consumed by the Bitcoin network is not necessarily a wattage. Finally understand that the mining of BTC a great asset for energy transfer.
Bitcoin (BTC), the accelerator of the energy transition
It makes sense to integrate bitcoin miners into power grids turning to renewable energy. It is enough to put a small interest in the implementation of an electricity network to be sure of this.
We start by saying that the quantity of electricity injected into a network must always be equal to the quantity of electricity consumed. Otherwise, it is the blackout.
To put it a little more technically, the network must permanently display a frequency of 50 hertz. This frequency is the yardstick to ensure that supply is equal to demand. Any deviation from this 50 hertz is a danger to the safety of the system.
Here is a video to go further of Mr. Bidouille who was able to visit the “control tower” of RTE, the manager of the French electricity transmission network. Where do we see those 50 hertz.
In France, our hydroelectric dams particularly facilitate the management of the quantity of electricity injected into the network. These make it possible to respond quickly to unexpected variations in demand. This avoids waste, a luxury that many countries do not enjoy.
This lack of responsiveness has been exacerbated since the start of the energy transition due to the non-intermittency of renewable energy. Due to the depth of the weather, the managers of the electricity network made life complicated. Especially in Germany, when the wind blows too much…
Indeed, electricity from wind power is a priority for our neighbors across the Rhine. Energy distributors are obliged to buy it at a guaranteed price, even if they don’t need it! So much so that the price of electricity will drop in the case of very strong winds.
The negative consequence is that it becomes more attractive for nuclear power plants to pay to absorb their production rather than bear the costs of shutting down/restarting their plant. Why? Because nuclear cores are sometimes “poisoned” by their fission products (so-called Xenon or Samarium effects)…
Does this mean that German households pay less for their electricity? No. Quite the opposite, since the distributors are obliged to buy electricity that is often not needed by anyone. This cost will therefore be passed on to the final consumer.
Everyone loses except wind power producers. Unless you include bitcoin in the equation. Let’s say, a megawatt spent by a BTC miner is not necessarily a megabyte.
Bitcoin miners could help by setting up near nuclear power plants to somehow offset the costs due to the electricity overflow caused by the European energy transition. Costs likely to increase.
In 2020, onshore wind power generation increased by 144 TWh (+11%) and offshore wind power by 25 TWh (+29%). between 2021 and 2030:
Texas is a textbook case since its electricity comes from 45% renewable energy. Lots of wind, but also nuclear. The rest comes from coal and, above all, from gas recovered during the extraction of shale oil.
The arrival of BTC miners in Texas strengthened the power grid. They provided a continuous profitable outlet for excess electricity due to the unpredictability of weather conditions.
That said, it will be interesting to see if rising gas prices don’t encourage some miners to relocate their operations elsewhere, where there are chronic surpluses of renewable energy. This is usually the case with African hydroelectric dams, which take years before the population fully accepts their production.
In short, the electricity bought by BTC miners is a welcome subsidy to fund the energy transition. The latest report from the Bitcoin Mining Council also reveals that 60% of the energy used to secure the network is renewable.
Of course, miners must stop their engines on command. In this way, miners become part of effective network management by immediately releasing watts.
the mining BTC must always be deployed in collaboration with the network managers so that too many machines are not deployed which could eventually increase the population’s electricity bill.
Sébastien Gouspillou, CEO of the company mining Big Block summed it up well in its report to the Salvadoran government:
“The mining Bitcoins must be socially useful. It should never compete with traditional demand. It must be set up where there is additional capacity to optimize the installed capacity/consumption ratio. Organized in this way, the mining will become a blessing to your country. Otherwise, it can quickly become a threat to the supply of the population and create a kind of chaotic situation. It therefore appears that the mining The State must be fully supervised, for the comfort of the population and for the reputation of bitcoin. The mining machines must be mobile, in containers, so that they can adapt to the evolution of the country’s electrical landscape. »
Bitcoin miners are buyers of last resort for the renewable energy that nobody wants. All States should integrate it into their financing strategy for their energy transition.
Get a summary of news in the world of cryptocurrencies by subscribing to our new daily and weekly newsletter service so you don’t miss any of the essential Cointribune!
Journalist reporting on the Bitcoin revolution. My papers deal with bitcoin through geopolitical, economic and libertarian prisms.