The Average Electrical Costs To Mine Just One Bitcoin, Broken Down By State, Are Staggering
One of the things lost in all the bitcoin hoopla, from the massive swings in value to hackers wreaking havoc and all the doomsday predictions, is the fact that thee rise of bitcoin and other cryptocurrencies also mean massive electricity consumption.
Back in December, Ars Technica published an article on bitcoin in which they cited one estimate by Digiconomist that suggests the Bitcoin network is consuming as much energy as the country of Denmark.
By the site’s calculations, each Bitcoin transaction consumes 250kWh, enough to power homes for nine days.
Naturally, this is leading to concerns about sustainability. Eric Holthaus, a writer for Grist, projects that, at current growth rates, the Bitcoin network will “use as much electricity as the entire world does today” by early 2020. “This is an unsustainable trajectory,” he writes.
Now, a new study by Crescent Electric has revealed the average electrical costs to mine just one bitcoin in each of the 50 states and the numbers are staggering.
The data they used is the average of three popular mining rigs (AntMiner S9, AntMinerS7, and Avalon 6) and their power consumption and time to mine one bitcoin. Then, that was multiplied by the average electricity rate (residential) in each state, taken from government data, to get the final cost.
Here are the top 10 states with the highest average electrical cost per bitcoin mined.
1. Hawaii — $9,483 per bitcoin mined.
2. Alaska — $7,059 per bitcoin mined.
3. Connecticut — $6,951 per bitcoin mined.
4. Massachusetts — $6,674 per bitcoin mined.
5. New Hampshire — $6,425 per bitcoin mined.
6. California — $6,200 per bitcoin mined.
7. New York — $6,151 per bitcoin mined.
8. Rhode Island — $5,850 per bitcoin mined.
9. Vermont — $5,847 per bitcoin mined.
10. Maine — $5,220 per bitcoin mined.
For what it’s worth, Louisiana is the cheapest state to mine one bitcoin (relatively speaking) at $3,224 per bitcoin mined.
Pretty crazy, right? It’s not all doom and gloom though.
According to CNBC…
Bitcoin mining is now being done at dedicated data centers that have sprouted up from Iceland to Inner Mongolia, where electricity prices are cheap. Much of the mining takes place in China, which generates most of its electric power from coal, prompting warnings that bitcoin threatens to wreck the environment and supersize the world’s carbon footprint.
Several energy experts caution that there is currently no reliable, verifiable way to measure just how much electric power is consumed in the process of minting the cryptocurrency. They say the first step is gathering hard data from the data centers, and no one has done that work yet.
“Many of those calculations that you see today I think are based on very weak assumptions,” said Christian Catalini, an assistant professor at the MIT Sloan School of Management who studies blockchain technology and cryptocurrencies.
“I don’t think anybody can make a credible claim about the current” electric power use for bitcoin mining “without actually having data from the miners.”
Of course, one solution to all the energy being consumed by bitcoin miners is for the price of the cryptocurrency to plummet. Less value equals less interest in mining.
Oh, look, that’s already happening.