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  1. Crypto Channel
  2. Bitcoin Miners Have Room to Increase Renewable Energy Use
Crypto Channel
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Bitcoin Miners Have Room to Increase Renewable Energy Use

Tom LydonNov 08, 2023
2023-11-08

One of the most frequently mentioned criticisms of bitcoin mining is that it’s energy-intensive. Making that matter worse is that the industry is a massive consumer of fossil fuels, arguably inviting that criticism. Indeed, data supports the notion that there’s ample room for bitcoin miners to increase usage of renewable energy.

Some companies are getting that memo. As the groups’ green energy consumption increases, assets such as the Invesco Alerian Galaxy Crypto Economy ETF (SATO ) could benefit. The equity sleeve of the fund’s portfolio heavily tilts toward cryptocurrency miners. That’s an asset class that isn’t highly correlated to crypto prices. But it’s one that’s also drawn the ire of policymakers and regulators for elevated dependence on fossil fuels.

Greenfield of Green Energy Opportunity for SATO

Data confirms the point that the bitcoin mining industry, including SATO member firms, have plenty of room to improve renewable energy consumption. According to BanklessTimes.com, two-thirds of the energy consumed by bitcoin miners is fossil fuels, including coal and natural gas.

“The choice of energy for Bitcoin mining has become a topic for debate. There is increasing evidence indicating that a significant amount of Bitcoin mining relies on fossil energies. This information is causing concerns about the impact of Bitcoin and how it could contribute to climate change,” noted analyst Alice Leetham.

Some bitcoin miners are awakening to the benefits of broadening use of renewables. If nothing else, by boosting use of green energy, cryptocurrency miners can appease regulators while reducing criticism of their energy choices. Additionally, reduced dependence on fossil fuels could, over time, boost profitability in the industry.

Data indicates some operators are already seizing the benefits of renewables. Thirty-seven percent of the energy consumer by bitcoin miners is derived from hydro or wind power, according to BanklessTimes. Nearly 13% is either nuclear or solar. Those percentages aren’t staggering, but they imply room for growth and that some miners are taking seriously environmental stewardship.

“Bitcoin mining companies, investors and enthusiasts have a shared responsibility to lead the industry towards friendly practices. It is essential to invest in energy infrastructure, promote research and development of energy technologies and advocate for strict regulations. These measures are crucial for reducing the impact of Bitcoin mining,” concluded BanklessTimes.

For more news, information, and analysis, visit the Crypto Channel.


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