The Bitcoin Mining Council (BMC) has released its fifth quarterly report. The data collected by the BMC concerns 45 miners representing more than 50% of the miners on the Bitcoin network. This report is therefore highly anticipated to see the progress made by Bitcoin in the use of renewable energy in particular.
The report first tells us that the miners of the Bitcoin Mining Council currently use 66.8% of their electricity from green energy. The members of the BMC are mainly Americans and Canadians and can be considered good students in this area.
The estimate for the Bitcoin network as a whole is lower, with 59.5% of electricity coming from renewable energy. That's a 6% increase over last year. A more than encouraging sign:
Overall, Bitcoin mining consumes 0.15% of the world's energy:
That is 24 times less than air conditioning or almost twice as less as the gold mining industry. Its share in global CO2 emissions is 0.086%:
However, the progress has been meteoric. The energy efficiency of the Bitcoin network has increased by 46%, from 14.4 to 21.1 Exahash per gigawatt in just one year! This efficiency has increased 58 times in eight years and now stands at 47.4 J/TH:
As such, here is a very interesting graph unveiled by Fred Thiel, the CEO of Marathon. On the left, you can see the type of machines used worldwide to mine Bitcoin. On the right is the energy efficiency projection:
At the presentation of the fifth BMC report, here is what Michael J. Saylor said:
“In Q2 2022, the Bitcoin network's Hash Rate increased by 137% while energy consumption only increased by 63% year-over-year, giving us a 46% increase in energy efficiency. The latter has increased due to advances in semiconductor technology, the rapid expansion of mining in North America, the Chinese exodus, and the worldwide adoption of renewable energy and modern mining techniques.”
Bitcoin mining drives renewable energy development in Texas
Part of the BMC presentation was then dedicated to Texas. This is an American state that is sympathetic to Bitcoin miners, who are seen as an asset through their purchases of electricity during off-peak hours. This money acts as a subsidy for renewable energy.
Except that the miners have to shut down their operations during peak demand. That's not a problem for Argo's CEO, who makes no secret of the fact that “sixteen miners were forced to return 1,000 megawatts to the grid this week”. This compares to the 86,000 megawatts consumed by Texas on a very hot day.
Indeed, high temperatures push Texans to air-condition, which makes the price of electricity skyrocket. The price per MWh can go up to $5,000 according to the CEO of Riot Blockchain, the largest Texan miner.
But since miners have a fixed electricity price for the year, much lower than $5,000, miners have an incentive to sell it rather than using it to mine Bitcoin.
That's fine. But what about the loss of revenue when BTC is $100,000? Not to mention the overall increase in the price of the joule. And especially the gas joule, when the price of gas and Brent oil are at near parity, expressed in energy equivalence. Will we see the first gas shock in history?
This will be something to watch in the coming months.
The fact that 11% of the Bitcoin network's Hash Rate is currently in Texas may not last. The price of gas pumped along with shale oil will eventually rise, allowing for a better geographic distribution of the Bitcoin Hash Rate.
Finally, it's worth noting that Bitcoin mining will make even greater strides in the area of energy efficiency in the future with the arrival of 3-nanometer chips from Samsung. In short, the best is yet to come, as always with the Bitcoin revolution.
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