The Energy Information Agency is starting the process to require cryptocurrency miners to submit energy consumption data after a previous attempt faced legal challenges.
But wholesale prices shift significantly by time of day, especially in the spring and fall. California’s wholesale prices dipped to the negatives during the days this past spring, hitting -$26/MWh at one point in April. One can imagine projects that only mine when energy is cheap or Bitcoin is expensive, in places that can take advantage of that price volatility.
There are also a few projects that don’t rely on grid electricity because they’ve provisioned their own energy sources (one creative solution is a shipping container with a data center powered by waste flaring of natural gas at oil wells).
So I’d think the price volatility would make it hard to derive a meaningful calculation of energy use from real-time electricity pricing, rather than real-time computational complexity.
Wholesale prices do bounce around significantly in a day, occasionally even going negative. And some miners do shutdown for brief periods during high demand due to a high electricity price. Some miners aren’t buying electricity from the grid, and have their own generation sources with different economic inputs. And there’s lots of day to day volatility in mining rates that has nothing to do with economics.
There’s no formula or methodology that could tell you how much energy is being wasted at any given moment. That impossible. There’s no way of knowing how many miners are operating globally at any given point in time. We can’t even reliably tell which country a block was mined in. We can only make reasonable estimates of global averages over the last few weeks.
You can get closer with more detailed modelling, but the equation I gave using global averages for bitcoin and electricity prices in the last few weeks will get you to an accurate estimate.
But wholesale prices shift significantly by time of day, especially in the spring and fall. California’s wholesale prices dipped to the negatives during the days this past spring, hitting -$26/MWh at one point in April. One can imagine projects that only mine when energy is cheap or Bitcoin is expensive, in places that can take advantage of that price volatility.
There are also a few projects that don’t rely on grid electricity because they’ve provisioned their own energy sources (one creative solution is a shipping container with a data center powered by waste flaring of natural gas at oil wells).
So I’d think the price volatility would make it hard to derive a meaningful calculation of energy use from real-time electricity pricing, rather than real-time computational complexity.
You’re not wrong.
Wholesale prices do bounce around significantly in a day, occasionally even going negative. And some miners do shutdown for brief periods during high demand due to a high electricity price. Some miners aren’t buying electricity from the grid, and have their own generation sources with different economic inputs. And there’s lots of day to day volatility in mining rates that has nothing to do with economics.
There’s no formula or methodology that could tell you how much energy is being wasted at any given moment. That impossible. There’s no way of knowing how many miners are operating globally at any given point in time. We can’t even reliably tell which country a block was mined in. We can only make reasonable estimates of global averages over the last few weeks.
You can get closer with more detailed modelling, but the equation I gave using global averages for bitcoin and electricity prices in the last few weeks will get you to an accurate estimate.