The US state of Texas is experiencing a rapid influx of Bitcoin mining. As a result, the electrical infrastructure should support the industry’s projected 5,000 megawatts (MW) of additional power by 2023.


Huge increase in power consumption in the future

The Bitcoin mining industry in Texas currently consumes about 500 to 1,000 MW of power. The Electric Reliability Council of Texas (ERCOT) expects demand to increase fivefold by 2023. It reportedly has an additional 3,000 to 5,000 MW planned.

This expansion comes at a time when the Lone Star State plans to become home to 20% of the world’s Bitcoin mining activity. Texas has been the destination of choice for Bitcoin miners since the Chinese government officially banned Bitcoin mining earlier this year.

The state government has taken advantage of China’s ban by turning Texas into a haven for crypto miners. They can now take advantage of a ten (10) year tax credit, sales tax credits and state sponsored employee training.

However, some Texans are concerned that the existing power grid cannot be improved. ERCOT’s operation of the state’s power grid came under heavy scrutiny in February 2021 when blackouts ravaged the region amid an extreme cold spell. This left approximately five (5) million residents without power for days.

ERCOT had released a report on November 19. However, the report failed to instill confidence that the network issues have been resolved. Texas Observer reporter Amal Ahmed tweeted on Nov. 22:

“ERCOT’s new Seasonal Assessment Report seems to indicate that, unsurprisingly, the agency hasn’t changed its approach at all to truly prepare for extremes.”

Network stability

Some miners have tried to allay residents’ fears about the potential burden on the resources. The Texas Standard reported on Oct. 21 that some Bitcoin miners have partnered with local energy companies. The aim was to guarantee the stability of the network.

Meanwhile, several others are planning to use fully renewable and potential alternative energy sources. For example, natural gas flares, as Bitcoin’s mining operations are getting greener.

There are currently no proposals from the Texas state government to deal with potential problems that could arise from the surge in electric demand from crypto miners. As suggested by the Texas Standard, miners could be flexible in disabling their hardware. This is especially true for periods of peak demand. They could also charge a premium per kilowatt hour if they want to stay on during periods of peak demand.

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