Column: Electric dreams turn into a nightmare for battery metals
A sector that was once racing to build new supply has been closing mines and deferring projects as low prices bite into the cost curve.
A recent study by Cornell University researchers found that pairing cryptocurrency mining – notable for its outsize consumption of carbon-based fuel – with green hydrogen could provide the foundation for wider deployment of renewable energy, such as solar and wind power.
In detail, the paper found that leveraging the economic potential derived from green hydrogen and bitcoin for incremental investment in renewable energy penetration can enable capacity expansions of up to 25.5% and 73.2% for solar and wind power installations.
The analysis involved the idea of supplying the available power from solar and wind energy systems to a green hydrogen and cryptocurrency mining infrastructure with the economic potential used for the expansion of renewable power installations.
“Since current cryptocurrency operations now contribute heavily to worldwide carbon emissions, it becomes vital to explore opportunities for harnessing the widespread enthusiasm for cryptocurrency as we move toward a sustainable and climate-friendly future,” Fengqi You, co-author of the paper, said in a media statement.
In its current structure, mining blockchain-based cryptocurrency in the US can use as much carbon-based energy as the entire country of Argentina, according to a 2022 White House Office of Science and Technology report. Nearly all domestic crypto-mining electricity is driven by computer power-hungry consensus mechanisms, known as “proof of work,” which are used to verify crypto-assets.
Preliminary estimates by the US Energy Information Administration suggest that 2023 annual electricity consumption for cryptocurrency mining likely represents 0.6% to 2.3% of all of America’s electricity consumption.
“Acknowledging the substantial energy demands of cryptocurrency mining, our research proposes an innovative technology solution,” You said. “By leveraging cryptocurrencies as virtual energy carriers in tandem with using green hydrogen, we can transform what was once an environmental challenge into a dynamic force for climate mitigation and sustainability.”
In their research, You and doctoral student Apoorv Lal examined individual US states to assess potential energy strengths in each region.
Supporting cryptocurrency can hasten the building of extra energy infrastructure and potentially create 78.4 megawatt hours of solar power for each Bitcoin mined in New Mexico, for example, and potentially 265.8 megawatt hours of wind power for each Bitcoin mined in Wyoming.
“While cryptocurrency currently has a high dollar value (Bitcoin traded for more than $73,000 on March 13,) you cannot hold it in your hand,” You said. “It’s virtual. Think of cryptocurrency and energy in the same way – much like a gift card concept. Cryptocurrency also can hold an energy value and that becomes an additional function.”
The researcher pointed out that to advance a sustainable future for blockchain-based cryptocurrency stronger federal policies for climate goals and renewable energy need to move forward.
“Coupled with green hydrogen, this approach to cryptocurrency not only mitigates its own environmental impact but pioneers a sustainable path for renewable energy transition,” You noted. “It’s a novel strategy.”
Comments
Steve
The genius of this idea is promoting the concept that two massive energy sinks can combine to become a positive. That only works with multiplication, not addition. The energy used by cryptocurrencies is lost, not stored, it can never be regained or reused. Hydrogen at least has the potential to return ~25% of the original energy invested in its production.