Bitcoin Conquers Probability Energy – Bitcoin Magazine
This is an opinion editorial by Mickey Koss, a West Point graduate with a degree in economics. He spent four years in the infantry before transferring to the finance corps.
Imagine, if you will, a seller of goods that only worked under certain weather conditions. A car that only drives when it’s sunny. A heater that only works when it’s windy. Would you ever buy them? I don’t think you would. Because it is illogical. Why would you want something that worked on probabilistic weather conditions?
Sure they are predictable to a certain extent, but have you ever noticed how much the forecast can change from hour to hour? It’s a whole mathematical concept that was discovered when a meteorologist rounded a number in his weather prediction model. The result; a completely different prediction. Chaos theory was born.
Probabilistic electricity: a new framework for wind and solar
I think it’s time to rebrand these intermittent electrical generation techniques. I would like to introduce a new name that I think better captures their shortcomings: probabilistic electricity.
Intermittent already implies that they are guaranteed to not work at least some of the time.
The intermittent nature of these sources necessitates probabilistic capacity building. This is because the systems are based on weather conditions, whose predictions are based on models – probability models.
With wind generation specifically, there is a small window of wind speed where the turbines actually generate electricity. If the wind is too slow, the turbines may spin but will not actually generate electricity. If the wind is too fast, a brake is released so that the turbines are not damaged. It’s like the Goldilocks of electricity production.
Probabilistic weather breeds probabilistic electricity production. Wind and sun are fundamentally probabilistic systems.
I can’t imagine people will buy more cars, fridges or really anything just to reduce the risk of unusability in certain weather conditions. Imagine applying for a job and telling the potential employer that you can only work if the wind blows hard enough or there is less than a certain percentage of cloud cover. When applied to almost anything else, the logic behind wind and solar makes no sense.
Why would you want to waste money buying excess capacity since it’s guaranteed to not work at least some of the time?
Can someone say misinvestment?
Responsive charging means paying to lose money. Probabilistic energy makes it worse
In a previous article, I discussed the difference between baseload and responsive-load energy systems. The short story is that electricity producers maintain a constant load of electricity to meet basic demand. They also maintain responsive systems that ramp up and down to meet changes in demand throughout the day and as the seasons change.
What this means to me is that your electricity bills must not only cover the cost of electricity produced, but also the cost of maintaining generation capacity that is not being used much of the time.
Solar panels can make things worse. In a study conducted by Duke Energy in North Carolina, excess amounts of solar power throughout the day forced their gas-powered plants to taper off and then ramp back up to meet sunset demand. The result was actually more emissions, and more gas use. It’s like driving in the city versus on the highway. Reliable energy isn’t supposed to go up and down, but because probabilistic sources rely on the weather, that’s exactly what they have to do.
Wind is a bit easier of a criticism for me. It is not always windy; I rest my case, your honor.
Texas recently ran into trouble during a heat wave when the wind decided not to blow. Wind capacity produced at as low as 8% of total potential output. To make matters worse, there were also some clouds that threatened solar output, requiring grid operators to ask people to limit air conditioning use in temperatures above 100 degrees.
Even climate scientist Andrew Dessler admitted on “What Bitcoin Did” that wind and solar cannot survive without a reliable baseload like coal or natural gas.
If it can’t stand on its own, I don’t want it. Probabilistic energy is not only a waste of money, it is dangerous if you have to rely on it. There is a reason why hospitals use diesel generators as backup power. Because it has to work or people die.
BUT WHAT ABOUT BATTERIES?
If you hate bitcoin mining, then you’re going to hate how much actual mining goes into producing your “green” batteries.
Here is an article about the mining of rare earth metals used to make batteries. Looks like the Congolese kids are using hammers and chisels instead of heavy equipment. So I guess that fits the criteria for green? As long as they don’t use power just to let you save power.
Even the World Economic Forum thinks batteries are bad. Finally something we can agree on. Now, eat your bugs.
Sarcasm aside, folks; if you want more things, like batteries, you need more things that make the things.
Even if exploration leads to the discovery of more deposits in places like Idaho, you still have to mine for it, which if you remember isn’t super green. At least in Idaho, companies will not be able to rely on child labor. That’s a plus.
Bitcoin fixes this
The proof-of-work algorithm is not a waste of energy. There is no lack of energy, nor should there be. Through the use of bitcoin miners, stakeholders can monetize energy in ways that have never been done before, producing a number of positive externalities.
In a previous article, I discussed a few energy sources that miners exploited, essentially turning waste into cash and helping to reduce pollution. I also introduced a concept I came up with: eliminating variable load or electricity sources as needed.
Electrical demand is not constant; producers must immediately adjust the amount they produce to ensure supply and demand so as not to cause power outages or damage to infrastructure. Every second that part of the production capacity is not used is essentially a waste of money.
Instead of building out excess capacity that is guaranteed not to work, or not be used at least some of the time, I would push for more investment in reliable energy production systems like nuclear and natural gas.
Plants can be built to allow for population growth or growth in the center, with bitcoin miners acting as the constant demand or energy sponge for the system. Power plants will essentially run at or near capacity, only increasing and decreasing the amount of mining they do to adjust the amount of electricity released to the grid.
Wind and sun are probability-based energy systems. They are not a long-term solution, and worse, they likely make our grid less resilient and potentially even increase the emissions that environmentalists love to hate.
I am grateful to other writers and Bitcoiners like Level39 who continue to inspire me with their knowledge and creativity. Bitcoin mining can help make energy more abundant and affordable for everyone. It fundamentally changes the calculation behind new infrastructure investments. Bitcoin is the bridge between development and reality; we just need to go over it.
This is a guest post by Mickey Koss. Opinions expressed are entirely their own and do not necessarily reflect the opinions of BTC Inc. or Bitcoin Magazine.
