Sierra Club says accurate insight into crypto mining firms' energy use is 'urgently needed' in support of federal survey
Quick Take
- The Sierra Club laid out its concerns in an amicus brief filed on Wednesday in support of a survey that would collect data from crypto mining firms.
- The grassroots environmental organization pushed back against crypto mining companies and pointed to the exorbitant amount of energy crypto mining operations use.
The Sierra Club told a court that there is an urgent need for accurate insights into the impact of cryptocurrency miners on electricity demand, both under daily conditions and in situations of exceptionally high demand.
On Wednesday, the Sierra Club, one of the nation's largest grassroots environmental organizations, filed an amicus brief in support of the U.S. Department of Energy. This support comes in the wake of a lawsuit filed against the department by the Texas Blockchain Council and bitcoin mining company Riot Platforms last week. The lawsuit challenges the department's survey of crypto mining companies' electricity usage, a survey which a Texas judge has since temporarily halted.
The Texas Blockchain Council and Riot Platforms had argued that the survey was a product of "sloppy government process" and that the mining companies could be "irreparably harmed by being forced to divulge confidential, sensitive, and proprietary information." A hearing to discuss a preliminary injunction was set for Wednesday, but was canceled, according to court documents.
In a statement released on Wednesday, the Sierra Club highlighted the heavy energy consumption of crypto mining operations. Holly Bender, the Sierra Club's Chief Energy Officer, compared the energy usage of crypto mining to that required for lighting every home in the U.S., and said it generates more pollution than seven million cars. Bender also referenced the severe winter and ice storm that struck Texas in February 2021, underscoring the potential impacts of high energy consumption during extreme weather events.
“Their operations in Texas and across the country are driving higher energy prices and threatening grid reliability," Bender said in a statement on Wednesday. "Following the devastating impact of Winter Storm Uri, which led to hundreds of deaths in Texas due to power failures, it's particularly reprehensible for Texan cryptocurrency miners to obstruct basic efforts to gather essential data energy regulators need to deliver reliable, affordable power.”
The lawsuit's beginnings
The Department of Energy is being sued after the Energy Information Administration (EIA) — a statistical and analytical agency within the department — announced earlier this month that it would begin surveying crypto mining firms following an "emergency collection of data request," citing bitcoin's increase in price over the past few months as evidence for that emergency request.
In response to the judge's order to halt the survey, the EIA said it would not seek to impose fines, penalties or other consequences on companies for not responding to the survey through March 22.
The Sierra Club views the discontinuation of the survey on crypto mining companies' electricity consumption as a peril.
"Delaying EIA’s access to this information for months risks not just grid operators’ ability to ensure electric reliability to residences and businesses, but prevents grid operators and federal and state regulators from having the information necessary to prevent the abuse of current market rules by cryptocurrency mining companies to charge individual ratepayers, collectively, tens of millions of dollars to prevent grid outages," the Sierra Club said in its brief.
Preventing EIA from collecting data for months will increase the risk of rolling blackouts during intense weather events, the Sierra Club said.
"Because electrical reliability can be a matter of life or death, and because distorted demand can so heavily impact residential and small business customers’ finances, it’s essential that grid operators, utilities, federal and state regulators, and the public rapidly gain a better understanding of cryptocurrency facilities’ impacts on the system," the organization said in the brief.
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