How much energy does cryptocurrency mining consume in the U.S.?
A recent analysis by theEnergy Information Agency (EIA) estimates that large-scale cryptocurrency operations consume more than 2% of the country’s electricity.
And as Ars Technica noted in a report on Friday (Feb. 2), that’s around the equivalent of adding another state to the country’s power grid.
While there is some smaller-scale mining happening on home computers, most crypto mining happens on a large scale, with the bulk of the cost of these operations going to electricity, the report said. That’s led miners to move to places where electricity rates are cheaper.
According to the EIA, a lot of crypto mining has moved to the U.S. — where lower energy prices have typically been a policy priority — following China’s crackdownon the digital asset space.
Meanwhile, the Ars Technica report also cites an independent estimate by the Cambridge Centre for Alternative Finance which found that the U.S. was home to 38% of bitcoin mining at the start of 2020, up from a little more than 3% two years earlier.
The Cambridge Center’s research calculated that bitcoin mining now uses the equivalent of Utah’s electricity consumption. That’s a more conservative estimate. On the high end, the figure might be the equivalent to all the electricity used in the state of Washington.
It’s information like this that last year led the White House to propose the Digital Asset Mining Energy (DAME) excise tax, which would levy a tax on crypto mining companies equal to 30% of the cost of the electricity they use.
“Currently, crypto mining firms do not have to pay for the full cost they impose on others, in the form of local environmental pollution, higher energy prices, and the impacts of increased greenhouse gas emissions on the climate,” theWhite House Council of Economic Advisors(CEA) wrote on its blog.
The CEA argues that — as opposed to other energy-intensive industries — “crypto mining does not generate the local and national economic benefits typically associated with businesses using similar amounts of electricity.”
In response, the Chamber of Digital Commerce called on lawmakers to focus less on penalizing crypto miners and more on collaborating with the industry on ways to reduce energy consumption while allowing the sector to grow.
FAQs
How much energy does cryptocurrency mining consume in the U.S.? A recent analysis by the Energy Information Agency (EIA) estimates that large-scale cryptocurrency operations consume more than 2% of the country's electricity.
What percentage of electricity is used for crypto? ›
The energy consumption of all crypto assets combined is between 0.4% and 0.9% of annual global electricity usage, or 120 and 240 billion kilowatt-hours per year. That's more energy usage than all the world's data centers combined.
Is over 2 percent of the U.S.'s electricity generation now goes to Bitcoin? ›
A couple of behavior scientists think that consumerism is literally like mining bitcoin, meaning consumerism serves the same algorithmic function. This same energy could power multiple countries in other parts of the world.
Do U.S. Bitcoin miners use as much electricity as everyone in Utah? ›
A technician inspects the backside of bitcoin mining machines. Bitcoin miners in the US are consuming the same amount of electricity as the entire state of Utah, among others, according to a new analysis by the US Energy Information Administration.
Does bitcoin mining increase the electric bill? ›
Energy-intensive crypto mining has strained local electric grids, raised electricity rates for residents, increased local air and water pollution, and prompted noise complaints from neighbors across the U.S.
How much energy does crypto mining use in the US? ›
The U.S. Energy Information Administration estimates that mining for bitcoin and other digital currencies accounts for 0.6 to 2.3 percent of the nation's electricity use.
Does it take a lot of electricity to mine crypto? ›
Crypto mining uses a lot of electricity
Why so much electricity? Essentially, crypto tokens are generated by having a computer solve complicated puzzles. That requires a lot of computing power, generally done by specialized computers running calculations 24 hours a day.
How much electricity does it cost to mine Bitcoin? ›
$20K with 4.7c/Kwh. Mining a Bitcoin depends on your energy rate per Kwh, it costs $11,000K to mine a Bitcoin at 10 cents per Kwh and $5,170K to mine a Bitcoin at 4.7 cents per Kwh. Learn how and if mining right for you in June 2024!
How long does it take to mine 1 Bitcoin? ›
How Long Does It Take to Mine 1 Bitcoin? The reward for mining is 3.125 bitcoins. It takes the network about 10 minutes to mine one block, so it takes about 10 minutes to mine 3.125 bitcoins.
How much electricity does Bitcoin use in 2024? ›
"Since the start of 2024, Bitcoin mining in the U.S. has consumed an enormous 20,822.62 GWh of electric power," said Paul Hoffman, analyst at Best Brokers. "At the average commercial electricity rate of $0.1281 per kWh as of February, this amounts to an expenditure of $2,667,378,196.47."
Bitcoin mining has achieved a new sustainability milestone, with 54.5% of its energy consumption now powered by renewable sources, according to the Bitcoin ESG Forecast, a research series by Daniel Batten, a co-founder of methane mitigation fund CH4 Capital.
How much energy does bitcoin mining use compared to countries? ›
The value of Bitcoin, which makes up 49% of the whole cryptocurrency market, reaches approximately $921 billion. It is believed that Bitcoin, which surpassed 167 countries in global electricity consumption, may take 26th place on the list of most electricity-consuming countries.
How much electricity does bitcoin mining use in Texas? ›
Bratcher said bitcoin miners in Texas make up over 95% of what ERCOT calls “large flexible loads.” “There is about 2,450 [megawatts] of bitcoin mining in Texas, but this load isn't adding to peak demand since, as the data shows, miners curtail their consumption during peak demand,” Bratcher said in his email.
What happens if everyone stops mining bitcoin? ›
If miners stop mining Bitcoin, the network will eventually grind to a halt. For each block to be produced, there must be a consensus among the miners. That means no new transactions will be confirmed or added to the blockchain—they'll simply remain stuck in the mempool.
Who benefits from Bitcoin mining? ›
Cryptocurrency mining supports an efficient mechanism for distributing digital rewards. Miners who successfully add blocks to a blockchain automatically receive transaction processing fees and new digital tokens.
What country mines the most Bitcoin? ›
The biggest bitcoin mining countries are: 1) The United States (40%) 2) China (15%) 3) Russia (12%) This map will look very different in 1-2 years as miners in Africa and Latin America expand operations. A massive trend in the industry will be miners migrating toward these regions.
How much electricity does a Bitcoin use? ›
Estimates showed that, in 2023, dedicated mining companies with highly efficient setups would consume about 155,000 kilowatt hours (kWh) of electricity to mine one Bitcoin. The average energy consumed for one Bitcoin transaction is 851.77 kWh, equivalent to about a month of electricity for the average US household.
How much electricity does Ethereum use? ›
The CCAF now estimates that Ethereum will consume just 6.6 gigawatt hours of electricity annually, equivalent to about 2000 typical homes in the UK. In contrast, Ethereum's previous consumption from its launch to the Merge totalled 58.3 TWh – comparable to Switzerland's annual electricity consumption.
How much power does a crypto rig use? ›
That said, a few factors can influence the total amount of power your machine will draw from the grid each day. While CPU and GPU rigs may vary in their exact wattage, size or style of hardware set up, these methods of cryptocurrency mining tend to consume between 300W and 1kW per hour on average.
