Written by Michael Mortimer
A recent study by Alex de Vries, a Dutch economist working on behalf of PricewaterhouseCoopers (PwC), has suggested the global Bitcoin network consumes as much electricity as the entirety of Ireland. Mr de Vries published the study, titled ‘Bitcoin’s Growing Energy Problem’, in the energy-focused CellPress Joule and warned that power demand among Bitcoin miners could triple by the end of this year alone.
It’s an argument that’s akin to the concerns raised by computing experts in the 1990s that half of the American energy grid would be dedicated to powering the internet alone. That theory proved to be somewhat overestimated as the Berkeley Lab ScienceBeat confirmed. Jonathan Koomey, a researcher at Berkeley Lab, also disagrees with the view of de Vries on the power demands of Bitcoin. Koomey fears that the same false alarm bells are being rung about Bitcoin and cryptocurrency as a whole, with the assertion that Bitcoin energy amounts to the same amount consumed by Ireland leaving him somewhat uneasy.
Koomey insists that de Vries and other people that are keen to “overestimate electricity use” through the use of computers simply “don’t have adequate data to come to the strong conclusions” they are alluding to. Within de Vries’ report, he claims that the global Bitcoin network currently consumes a minimum of 2.55 gigawatts of electricity, with the potential for that to grow two-fold to around 7.67 gigawatts. Furthermore, de Vries is not alone in his fears about the appetite for gigawatt usage throughout the Bitcoin community.
While the vast majority of Bitcoin investors will choose to buy Bitcoin from credible exchanges, many of which are listed and reviewed on Best Bitcoin Exchange, a minority prefer to ‘mine’ their own Bitcoin using computer processors to solve cryptographic puzzles and create the Bitcoin, before adding it to the public ledger. Not even Koomey is suggesting that Bitcoin mining is not energy-intensive. But what Koomey is debating are the underlying calculations of the value of energy used in Bitcoin mining and the price paid for the energy.
Koomey believes that many of the figures bandied about by de Vries are simply plucked “out of the air”. He added that it was “very unreliable” to make assumptions based on calculations in this way. Another factor in the unreliability of de Vries’ Bitcoin energy claims is that much of the Bitcoin mining that goes on tends to be carried out in private. Subsequently, much of the energy consumption data necessary to come to any accurate conclusion is not easily at hand. In addition, many Bitcoin miners are very eco-conscious and aware of their impact on the wider environment. They tend to scour the world for cheap, low-carbon energy, with Iceland’s geothermal resources proving particularly popular with the Bitcoin community, according to Computing.co.uk.
When de Vries was pushed for comment on the feedback made by Koomey and co., he could not be reached, but the Dutchman released his own press release soon after, admitting that “back-of-the-envelope calculations” only go so far and that increased “scientific discussion” was needed to determine where the Bitcoin network is headed.