Federal agencies have the authority to force crypto mining companies to disclose how much energy they use and greenhouse gas emissions they create, according to letters between the agencies and Democratic lawmakers shared exclusively with The Verge.
The Biden administration acknowledges that it could force Bitcoin miners to disclose contamination
Bitcoin miners have flocked to the US over the past couple of years, sparking concerns about electricity use and greenhouse gas emissions. Despite the proliferation of crypto-mines across the United States, there has been no solid data on the impact each has on the power grid and national climate goals.
That could soon change as Democratic lawmakers push federal agencies to speed up plans to require crypto mining companies to report their emissions and energy consumption. That kind of transparency is an early, crucial step toward limiting pollution from cryptomining.
“We urge you to use these powers to implement a mandatory disclosure regime as soon as possible”
The Department of Energy (DOE) and the Environmental Protection Agency (EPA) have described “clear authority to require disclosures of emissions and energy use from cryptominers” according to a letter several Democratic members of Congress sent to the agencies yesterday. It asks each agency to provide timelines for when it plans to begin carrying out those authorities and collecting information.
“We urge you to use this authority to implement a mandatory disclosure regime as quickly as possible,” said the letter, which was signed by Senators Elizabeth Warren (D-MA), Sheldon Whitehouse (D-RI), Ed Markey ( D-MA), Jeff Merkley (D-OR), Dick Durbin (D-IL) and Representatives Jared Huffman (D-CA), Katie Porter (D-CA) and Rashida Tlaib (D-MI).
This is the latest move in a saga that began last year, when Democratic lawmakers asked the largest crypto mining companies in the United States to share figures on their energy consumption and pollution. Seven companies combined have the capacity to use more than 1 gigawatt of electricity, nearly enough energy for every home in Houston combined, according to the congressmen.
While several companies provided some data, none provided full answers to Democrats’ questions. That spurred members of Congress to ask the DOE and EPA in July to require crypto companies to publicly share information to get a more comprehensive picture of their impact on the web and the environment.
Seven companies combined have the capacity to use more than 1 gigawatt of electricity, nearly enough energy for every home in Houston combined, according to the congressmen
Warren’s office shared the DOE and EPA’s response to that July inquiry The Verge. In November, Energy Secretary Jennifer Granholm wrote a letter to Warren saying the US Energy Information Administration (EIA) has the authority to require crypto operations to report their energy use as “operating facilities … engaged in … major energy consumption.” Such a mandate would “require the development of a new survey to collect this information,” the letter said. The EIA could also require utilities to share information about how much power they sell to crypto companies.
The EPA, meanwhile, told lawmakers that the Clean Air Act gives it the ability to collect pollution data from facilities that pump out at least 25,000 tons of planet-warming carbon dioxide a year. The Democrats’ investigation into the nation’s largest cryptominers has already revealed that at least two companies operate cryptomines in the United States that fall into that category. Both of these companies already report these emissions in accordance with the requirements of the Clean Air Act.
But the letter Warren and her colleagues sent yesterday asks the EPA to clarify whether it has already listed every crypto operation that meets the 25,000-ton threshold — and if not, when it plans to do so. The letter asks for a response by March 6. The Verge contacted EPA and DOE, but did not receive comments by the time of publication.
While there are no concrete numbers yet on how dirty or energy-hungry cryptomining is in the US, the first estimates are striking. The crypto industry’s operations in the United States probably use about as much electricity as all of the nation’s home computers combined, according to a September White House report. That report recommended that the EPA and DOE work together to develop performance standards that would push crypto companies to transition to clean energy while using less energy overall. If that doesn’t work, the report suggests that Biden “The administration should explore executive action, and Congress could consider legislation.”
If that happens, the guidelines will primarily target Bitcoin – still the most popular and most polluting cryptocurrency. Other cryptocurrencies, including Ethereum, have already dropped the energy-hungry code that the Bitcoin network refuses to give up.
Bitcoin miners set up data farms filled with specialized hardware used to solve computational tasks. It is part of a deliberately energy-inefficient process to validate new transactions. The miners are rewarded with new tokens in return, although that incentive has coincided with Bitcoin prices during the enduring crypto winter. Still, the Bitcoin network is estimated to use almost as much electricity annually as the Netherlands, according to the Cambridge Center for Alternative Finance.
