As grid operators warn of power outages, Bitcoin miners head to Texas

On October 9, 2021, a worker installed a new row of Bitcoin mining machines at the Whinstone U.S. Bitcoin mining facility in Rockdale, Texas.

On October 9, 2021, a worker installed a new row of Bitcoin mining machines at the Whinstone U.S. Bitcoin mining facility in Rockdale, Texas.
Photo: Mark Felix/AFP (Getty Images)

Everything in Texas is bigger – including its problems Power grid with Bitcoin’s energy needs. A sort of New analysis shows that the grid is as vulnerable to the crisis as before the power outage in February The state is preparing for cryptocurrency operations, which will add tremendous pressure to the grid. And, experts say, do not know what will happen.

A sort of report Friday release By ERCOT, The organization that operates the Texas Power Grid, Found extreme weather—even if conditions were lighter than what the state saw in February, resulting in Large-scale blackout-Can still trigger power power failure And create problem grid. ERCOT has Yes By ringtone After the February crisis, but this analysis, Critics sayThis proves that the biggest problem of how ERCOT prepares for extreme situations has not been resolved. in other words, although Promises from politicians such as Governor Greg Abbott Although they have solved the problem, the Texas grid is as badly prepared for disasters as it was in February.

This already fragile grid is facing new pressures: Bitcoin miners, the state has been enthusiastically encouraging them to settle in Texas.Bloomberg report New power requirements Crypto mining In the next two years, Texas’ power generation may reach around 5,000 megawatts Years-approximately twice the annual electricity demand of all regions Austin in 2020.This means a worn grid By the end of next year, it may become home to 20% of the global Bitcoin network, from 8% to 10% now.Texas is at the forefront of a strong push by the United States State and city Watching Lure Crypto mining Operate, follow Suppress in China this summer. TonHe America is It is now the first destination of Bitcoin miners.

Suddenly introduce double Electricity value of the entire major metropolis Demand for the struggling grid May look dangerous under normal circumstances Ideas, especially considering how power need Attacks from Bitcoin miners caused power outages in some places Iran with KazakhstanIn contrast, the defenders of Bitcoin include Governor Greg Abbott and everyone’s favorite senator. Ted Cruise, Talked about The encrypted mining business will strengthen the Texas power grid.

In a purely theoretical sense, Bitcoin Can Use a sensitive grid like ERCOT. At this Ideally, mining centers will only operate when demand is low, consuming additional power Generated by power plants and closed when demand increases.

Joshua Rhodes, t’s research assistant, said: “If they all go online tomorrow, the ERCOT grid will increase a lot of demand.”He is the University of Texas. “However, for most of the year, not all of our power plants have been running. What they say about strengthening the grid actually depends on [miners] Willing to be flexible. “

Although Texas politicians are not currently enacting any tasks that require mining centers to close during peak demand periods, there may be market-based solutions. Rhodes served as a consultant for a company Texas-based company develops software Help the mining center respond in real time ERCOT requires reduced power.The software is suitable for what is known in ERCOTspeak As a controllable load resource, it refers to large energy consumers who are willing no Use electricity at a certain price during peak hours.Traditionally, controllable load resources have been large manufacturers, such as oil and petrochemical refineries, but companies that cooperate with Rhodes and some Other mining and data centers have begun to work as load resources in the ERCOT system.Financial incentives no Rhodes said that using electricity under this system may be enough to motivate miners to listen to ERCOT’s needs.

“I think [bitcoin] Can be a good neighbor. There is a way for it,” he said. “They will have to choose whether they want to. “

Data scientist Alex de Vries, who founded and operated the cryptocurrency website Digiconomist Bitcoin Energy Consumption Index, More doubts how this will work in real life.

“It is not attractive for miners to shut down at any time, especially because the machines become obsolete relatively quickly,” he said. “Whenever they close, they miss a certain level of profitability, Never come back. If they want to compete with others in the field, effectively, the only option is to run their machines 24/7. “

De Vries said that financial incentives that shut down like a controlled load resource plan may not be enough to make most miners willing to agree to shut down power.

“In all cases, it is more profitable for miners to continue operations than to shut down,” he said. “Even if they are paid extra for the shutdown, the profit of running the machine is still higher. In Texas, they may get more revenue from the shutdown than elsewhere, but it is still unattractive.”

Given what happened in February last year and how ERCOT basically acknowledged that the grid is still in a bad state, de Vries said the only way for Texas regulators to ensure that Bitcoin demand does not overwhelm the system is to regulate how much electricity Miners can use – something previously owned by a crypto-friendly place like Quebec start to do After they saw an increase in demand. (Given the response of Texas to the blackoutBut don’t hold Your breath.)

“When it went wrong, it was too late,” De Vries said. “They are taking this risk [increased demand]. It may actually pay the price of life. “

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