How Bitcoin Mining Can Reduce Renewable Energy Waste
Bitcoin miners, being the unique power consumers that they are, could be a possible solution to the problem of renewable energy waste.
Bitcoin mining can be used to use up excess power produced by renewable energy
According to the latest weekly report from Arcane Research, the flexibility of BTC miners means they can help reduce waste produced due to renewable energy resources.
Wind and solar power sources do not generate energy at a constant rate, but at a variable rate. This variation is not something we can control, so these sources inevitably end up generating quantities different from the grid’s needs.
At times when these generators produce excess energy, power prices in the market can crash to very low values, or even sometimes negative prices.
Both wind and solar have seen some strong growth in recent years, and according to the report, they are expected to continue to grow rapidly. Here is a chart showing the trend in the global capacity of these sources so far, and how they are likely to do in the future:
Looks like solar will grow much more faster than wind in the coming years | Source: Arcane Research's The Weekly Update - Week 36, 2022
The report notes that there are a couple of reasons why Bitcoin mining could potentially mitigate the frequency of negative prices in solar and wind power grids.
First, mining is location agnostic, meaning miners can set up their rigs pretty much anywhere around the world without issue, as long as the location has power available.
And secondly, miners can be turned on and off as and when miners want, without causing problems.
These factors allow miners to move their farms close to renewable sources, and only take electricity when there is excess energy available. At all other times, the generator will deliver it straight to the grid.
Apart from these, there are also some other reasons that make mining suitable for this purpose. For example, the portability associated with mining rigs, and the fact that their energy intake can be varied on a per-pitch basis, enables miners to use exactly as much surplus energy as is available.
The report explains that as solar and wind continue to grow, so will the excess energy produced by them. If this problem remains unmitigated, it could threaten the economics of renewable energy and limit the sector’s growth. It seems that Bitcoin mining may be able to help limit this problem.
BTC price
At the time of writing, Bitcoin’s price is hovering around $20.2k, up 7% in the last week.
The value of BTC has plunged down | Source: BTCUSD on TradingView
Featured image from Dmitry Demidko on Unsplash.com, charts from TradingView.com, Arcane Research
