These are the best US states for Bitcoin mining, according to an Ivy League study
As Bitcoin miners flock to the United States, politicians and environmentalists alike are warning about the ecological costs of the energy-intensive industry. In September, the White House released a report citing that the US hosts about a third of the world’s crypto mining, and consumes up to 1.7% of the country’s electricity, the equivalent of all residential lighting.
A new study by researchers at Cornell University argues that environmental concerns can be mitigated by deploying Bitcoin mining more efficiently in states that prioritize renewable energy and have lower operating costs, potentially reducing damage.
As electric grids increase the use of renewable energy sources such as solar and wind, and explore carbon capture technology, Bitcoin mining can become more sustainable at an accelerated pace.
Dr. Fengqi You, a professor of energy systems engineering, led the research in hopes of driving better public policy related to mining.
“As more of these mining facilities come to the United States, and more of the public thinks about investing in these sectors,” he said, “what are the consequences for the climate and for our energy systems?”
Bitcoin uses a proof-of-work consensus mechanism: In order for transactions to be recorded in the public ledger known as a blockchain, different people – or miners – race to solve complex algorithms. The winner validates the block and is rewarded with Bitcoin.
The process requires enormous computing power, with energy consumption corresponding to the requirements of countries such as Finland. It also results in massive carbon emissions – an estimated 90.76 million tonnes annually, compared to the carbon footprint of Greece.
In recent years, business has moved to the United States as former hubs such as China have banned Bitcoin mining. They have been concentrated in Texas, with its deregulated energy grid, as well as in New York. The two states account for 14% and 19.9% of Bitcoin’s computing power in the US, respectively.
The Cornell study found that the current distribution of mining in the US does not make sense from either a cost or emissions perspective.
“Each state has its own power mix,” you said Fortune. Some states are more dependent on hydropower, others on nuclear power or natural gas.
When his team looked at the total cost of mining in different states, including capital expenditures and operating costs, they found a strong correlation between using clean energy and lowering project costs, which you said was surprising because renewable energy is often considered relatively expensive.
Moving forward, he said, it will be crucial to move mining to places with better renewable capacity, not only from an environmental point of view, but also from an economic point of view.
While the map above shows the top states in the short term — with places like Washington and New York as top contenders — they also conducted an analysis of how the picture could change with increased political support for renewable energy. In that scenario, states including Vermont and Oregon become more favorable. Texas, you added, is not the best or worst choice because of its relative carbon emissions associated with its electric grid.
While the study does not endorse Bitcoin mining, it acknowledges that it is likely here to stay – and operations can be optimized to reduce carbon emissions and lower costs.
“Ideally, if they’re only going to use renewable energy sources to mine Bitcoin, then we can argue that they won’t have any impact on the climate,” you said. “But in practice, of course, we know that we are not yet at the stage of a 100% renewable energy grid.”
