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Texas crypto miners could need as much energy as all of New York State

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Texas crypto miners could need as much energy as all of New York State

Cryptocurrency miners are accelerating their efforts to expand in Texas far beyond what authorities originally anticipated, threatening to skyrocket the state’s electricity consumption.

Enough miners have applied to connect to the Texas power grid to use up to 33 gigawatts of electricity, the Electric Reliability Council of Texas, which operates the system, said Friday. That’s a third more than the network operator’s chief executive said in April officials were gearing up to manage over the next decade. It’s also enough to power the entire state of New York.

A spokeswoman for the grid operator, known as ERCOT, said officials expected to have enough power plants to meet any increase in demand. Miners will need approval from ERCOT before connecting to the network.

The growing interest underscores how attractive Texas remains for crypto miners, even though Bitcoin’s value has plunged more than 50% in the past year. And while many of those miners may never settle, the shear count applied raises questions about whether the state’s grid, which collapsed in a deadly winter storm in 2021 , will be able to meet the demand for electricity.

Crypto miners currently account for about 1.2 gigawatts of electricity demand in Texas, according to the Texas Blockchain Council, which represents miners. That’s enough to power about 240,000 homes. Over the past four months, the number of miners requesting to connect to the network has doubled.

The state has aggressively recruited miners, touting its cheap electricity, abundant renewable energy, and business-friendly regulatory environment. Texas has some of the cheapest electricity rates for heavy consumers, averaging about 7.57 cents per kilowatt hour in June, a third lower than the national average, according to the US Energy Information Administration. It also has more wind power than any other state, which attracts miners who push to appear more environmentally friendly.

In April, ERCOT interim CEO Brad Jones said he was working with miners to prepare the network to handle around 25 gigawatts of crypto demand over the next decade. When asked if Texas aims to be the largest mining center in the world, he replied, “Yeah, that’s what we plan to do.”

Crypto miners say they can actually help stabilize the Texas grid by absorbing excess power from wind and solar farms during the day, then shutting down when demand increases and the grid needs more power. ‘electricity. According to the Texas Blockchain Council, nearly all miners in the state went out of business during heat waves in early summer, when demand for electricity in Texas soared to all-time highs.

While miners typically pay upfront for certain infrastructure to connect to the network, the additional demand will likely require larger upgrades that critics say will drive up costs for households and other businesses.

Naureen S. Malik, Bloomberg

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