Here’s one way Bitcoin miners can make money: Selling electricity back to Texas
A Bitcoin mining biz said it made $9.5 million selling electricity back to the power grid of Texas at a premium when energy demand rose to record levels during a heatwave last month.
Riot Blockchain, headquartered in Colorado, operates one of the largest crypto-crafting facilities in America. Located in Rockdale, Texas, the site is home to tens of thousands of Antminer S19 ASIC-powered systems that sit in what look like sinks filled with a heat-absorbing fluid to keep the hardware cool as it constantly runs software to mine Bitcoin. Last month, the biz decided to power down the mining rigs as energy prices in Texas soared.
Demand for electricity in the Lone Star State rose as people turned up their air-con and other equipment amid a scorching heatwave that drove temperatures beyond 37 degrees Celsius (100 degrees Fahrenheit). This put a lot of strain on the state’s electrical grid, which is operated by the Electric Reliability Council of Texas (ERCOT).
“As energy demand in ERCOT reached all-time highs this past month, the company voluntarily curtailed its energy consumption in order to ensure that more power would be available in Texas,” Riot Bitcoin’s CEO, Jason Les said on Wednesday.
The company cut back on a total of 11,717 megawatt-hours, an amount that Riot said could power 13,121 average homes for a month (that works out if you use Uncle Sam’s average figure of 893 kWh per US home per month).
But what Riot Bitcoin suffered in monetary loss when it slashed its mining capacities, it more than regained it in power credits. It resold the electricity it had previously purchased to keep its facility ticking over back to ERCOT at a premium price during the heatwave.
“By providing power back into the ERCOT grid during periods of peak demand, the company estimates that power credits and other benefits from curtailment activities totaled an estimated $9.5 million, significantly outweighing the reduction in [Bitcoin] mined,” Les said. The value is worth about 439 Bitcoin, according to July prices for the cryptocurrency. For comparison, it produced 443 Bitcoin July 2021, though back then BTC was worth a lot more.
Bitcoin miners like Riot can save money or even turn a profit by temporarily halting operations and selling back the energy credits they already bought, if the circumstances are right. Particularly now that the price of Bitcoin has crashed, it’s possible to make more cash buying credits low and selling them high than using them on crafting a cryptocurrency stuck in the doldrums.
The crypto-market as a whole went into free fall from late last year amid economic uncertainty, rising inflation, and other macroeconomic factors.
Riot has agreed to participate in the Four Confident Peak program, an effort led by ERCOT to stabilize energy consumption during peak demand over four months in the summer, Bloomberg reported. The company will wind down its 750 MW Whinstone facility to give the electricity grid a bit of a break during those months. ®
via The Register https://ift.tt/o0PVmEh
August 3, 2022 at 04:28PM