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Bitcoin mining is a positive for the energy industry for four reasons, says a report by research firm Arcane Research. This activity can strengthen electrical networks, improve the use of energy in two ways and reduce emissions that are harmful to the environment, it is explained.
The first of the points made in the has to do with the strengthening of electrical networks. Bitcoin mining can collaborate with this thanks to its flexibility in energy demand.
It happens that renewable energies (solar, wind, hydroelectric, among others) are not constant, but their generation fluctuates according to various variables that cannot be controlled.
Therefore, they can be better used with a variable energy demand such as that of Bitcoin miners, who can disconnect their equipment when there is a shortage. As CriptoNoticias reported, this recently happened in the face of a heat wave in Texas, United States. Although it does not specifically point to the use of renewable energy, it is a concrete example of the flexibility of the network.
The report details that this faculty is called “demand response”, referring to the ability to be flexible in the expenditure of electrical energy. This is an important factor that must be increased to 10 times its current value by 2030, as stipulated in the Paris Agreement of the International Energy Agency.
Efficient Use Of Energy
On the other hand, the second benefit of Bitcoin mining is the greater use of renewable energies. The energies of this type will grow from 11% of global energy production in 2020 to 42% in 2040, says Arcane Research. This increase in the production of renewable energies leads to greater waste, since, as mentioned, they are not very constant and predictable.
Bitcoin mining can help consume that surplus when it occurs. This is because, just as you can reduce your consumption when there is a shortage, you can also ensure constant spending when the energy reaches or is left over.
There are several features of Bitcoin mining that contribute in this regard. Among them, the ability to relocate depending on the circumstances, the perseverance in its operations and the aforementioned adaptability stand out. Even miners could locate in areas with an abundance of solar or wind power and build an operations center exactly sized for the spare power capacity, the report says.
The third benefit of Bitcoin mining for the electrical industry also has to do with the convenient use of energy. More precisely, it is linked to the generation of heat.
Heating for homes and industries is the main focus of electrical energy consumption in the world, with almost half of the total consumption of 2021 destined for this purpose. Likewise, it is the activity that releases the most greenhouse gases into the environment, adds the Arcane report.
Heat generation is a secondary consequence of Bitcoin mining. Therefore, the reuse of that heat can be not only a way to reduce costs, but also to reduce gas emissions in the environment, and even more so if renewable energies are used. The same electricity could be used for two different purposes.
This is something that is already happening, says the report, and it occurs especially in cold weather areas. For example, the projects that lead the innovation in terms of heat reuse are in Canada and the Scandinavian region. On the other hand, the subject is not of much interest in areas with a warmer climate, such as Texas.
Gas Emission Reduction
Finally, the fourth positive consequence of Bitcoin mining for the energy industry is related to the mitigation of the burning of natural gas, a process called "gas flaring" or "gas burning" that produces emissions that are harmful to the environment without providing any benefit in return.
During oil extraction, liquids and gases (mainly methane gas) are released into the environment. Although this waste can be used, it is not profitable for oil companies because gas is worth less than oil and is more expensive to transport.
Therefore, if the extraction well is not near a town where the gas can be piped (as is the case in most cases), companies choose to burn the resulting gas. In 2020, emissions from this process were equivalent to those from 100 million cars.
The methane that is generated with these gas burns is greater than what would be produced using that gas in an electric generator, the report details. Also, if used to generate electricity, methane gas could produce 700 TWh per year, "which exceeds the electricity consumption of almost all countries in the world."
In this way, if the gases that are wasted today were used to generate energy to mine Bitcoin, the profits from this activity would finance the infrastructure and reduce emissions by approximately 63%, says the report.
