Bitcoin mining is the method used to generate new cash and confirm new transactions. The method includes huge, decentralized networks of computer systems world wide that confirm and safe blockchains, the digital ledgers that doc cryptocurrency transactions. In return for contributing their computing energy, miners are rewarded with new cash. The method finally requires lots of power to carry out, which is the place energy firms are available in.
“Bitcoin mining can help the energy sector,” Andrew Webber, founder and CEO of Digital Power Optimization (DPO), stated as a visitor on The POWER Podcast. “Instead of just selling power to third-party Bitcoin miners, we suggest, that, in many circumstances, energy companies themselves are actually far better positioned to build their own Bitcoin mines and undertake this strategy and this activity for their own purposes in a vertically integrated way, where again, the energy company owns the Bitcoin mine. And by operating a Bitcoin mine, in conjunction with an energy asset, in an intelligent and thoughtful way, you can really optimize your generation assets in a way that you couldn’t really have done without a tool like Bitcoin mining to help you.”
Webber stated the concept got here to him whereas studying a narrative within the newspaper. “I was reading [a Los Angeles Times] article about the state of California paying the state of Arizona $20 per megawatt-hour to get rid of all of its power. And I said, ‘What is going on? That seems absolutely crazy to me. I’ll take all of it. You know? I’ll set up a Bitcoin mine there, and just, any power you don’t want, just send it to me, I’ll take it for free,’ ” he stated.
Webber defined how Bitcoin mining may help energy firms alleviate points. “This is a mechanism that can go almost anywhere and soak up this excess available power where it’s produced, and then apply that value elsewhere across the globe in a way that actually solves these problems,” stated Webber. “So, it’s quite an interesting tool for the energy sector once they get their heads around how this will help.”
Bitcoin mining offers flexibility, too. If energy is required out of the blue for purchasers, the facility firm can reply by merely shutting down the mining operation. “You can just turn it off, and so, it makes a really good tool to respond to sharp jumps in demand or transmission difficulties,” Webber stated. “It’s sort of energy management infrastructure. And when you start thinking about an energy company building these things, it’s not really Bitcoin mining, you’re managing your energy assets in a different way, using a different system.”
Organising a Bitcoin mining operation is pretty easy. Webber stated a 1-MW system suits in what appears like a regular transport container—basically, a 40-foot by 8-1/2-foot massive steel field. Inside are racks, wiring, all of the networking gear, a filtration system, cooling followers, and 300 to 325 very specialised computer systems. The container is linked to a transformer provided by 240-V or 277-V energy, and mining can start on no matter schedule works greatest for the facility firm together with 24/7/365.
“You put one of these containers down, five of them, 10 of them, 200 of them, whatever is called for on that specific site for that specific use case,” stated Webber. “And you don’t have to do it all at once either. You can scale it over time. Start with a megawatt. Watch it. Make sure it does what we tell you it’s going to do. Six months later, if it’s humming along and you’re happy, build another one, build five more. If you like those, build 50 more. We’ll go look on every asset you own and figure out where these might work. So, you can take a phased approach. You don’t have to go commit to $100 million of spend on day one. You can start slowly. DPO offers free pilots.”
Ultimately, nevertheless, Bitcoin mining is only one instrument in an influence administration toolbox. It may be utilized in mixture with different options, together with battery storage and inexperienced hydrogen manufacturing. “All of these are things that need to be incorporated and thought about, not individually, but frankly, in concert with one another,” stated Webber. “Right now, I think the energy sector has close to zero understanding that this is available to them, and that’s what we’re hoping to change. And I think it’ll be probably commonplace over the next decade or two.”
To listen to the total interview, which incorporates rather more about Bitcoin mining and a few concrete examples of how it’s getting used to optimize energy era belongings in a number of places world wide, take heed to The POWER Podcast. Click on on the SoundCloud participant under to pay attention in your browser now or use the next hyperlinks to succeed in the present web page in your favourite podcast platform:
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—Aaron Larson is POWER’s government editor (@AaronL_Power, @POWERmagazine).
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