Can Bitcoin offer ESG opportunities? Renewablox thinks it can

Callum Wheeler, CEO of Renewablox, has been involved in renewables for some time, and was a pioneer almost a decade ago in developing a consumer electronic prototype when he plugged a solar panel into the back of an iPad. He has a passion to use energy more effectively – to create progress not just to not use energy.  And today he is looking at Bitcoin mining to take advantage of stranded energy in the UK and beyond.

What ESG opportunities does Bitcoin offer?

Initially, his career diverted for a number of years into healthcare where he was an associate anaesthetic practioneer. Around the same time, he became engrossed in Bitcoin where the underpinning philosophy attracted him.

“I guess I began to understand that Bitcoin represents freedom and self-sovereignty from government. I mean over the past 50 years money has become synonymous with government and I see Bitcoin as a way of untethering it.”

Wheeler echoes Michael Saylor (of MicroStrategy fame) expression that Bitcoin is energy.

“I’m fascinated between the ties of Bitcoin and energy – this is the first time you are transferring energy directly into value. Traditionally, energy is seen as a utility – we use it to power our laptops or to boil a kettle. But with Bitcoin we are transferring energy directly into value and that is something that has never happened before. And when you add in renewable energy, it is very powerful.”

With Renewablox, Wheeler has set his sights on stranded energy in the UK. The Renewablox solution is also universal. It can be applied to any source of renewable energy in any geographic location on a temporary, semi-permanent or permanent basis

Stranded energy in the UK

Stranded energy is something more usually associated with the oil fields of America, but the startling new reports by financial think tank Carbon Tracker in the UK has shown that curtailment of wind energy has a double whammy of wasting as much as $1.85 billion in lost energy, which then by default added $40 to every household in extra costs. This wind curtailment is mostly due to a not-fit-for-purpose grid system unable to absorb and transmit energy from multiple inputs. It is estimated that the upgrade will not be done for another seven years.

Methane gas absorption

It is a similar story with methane gas which is considered to be 80 times more damaging to the planet’s environment measured over a 20-year period. Methane is produced as a natural by-product and in vast quantities from various sources such as the agricultural and Oil & Gas industries, landfills, distilling, water treatment plants, paper milling and many others.

Methane can be “harvested” via Anaerobic Digester (AD) plants. Food and animal waste is collected, processed and broken down at these plants and the methane that would otherwise be lost to the atmosphere is collected and stored in tanks. Then, the gas is sent to generators in a controlled flow to produce power that can be sold to the grid or used onsite.

However, like any other power producer, fluctuations in grid demand mean that generators have to be periodically powered down or even switched off, resulting in reduced efficiency, lost revenues and/or possible back up in the production process, which can’t be shut off easily.

The Renewablox solution solves many of the fluctuation issues and problems associated with it and is already in discussions with various operators in the UK with a view to deploying the first site at the end of 2024.

There is also a second – and exciting – application of the Renewablox solution; taking methane direct from the source in industries where it is created as part of the production process, but is entirely unwanted and has to be managed or mitigated by producers.

In these cases, removing methane on a consistent and industrial scale often creates additional economies of scale, both in the production of their primary product, but also in reduction of cost associated with the methane management.

Renewablox is currently exploring several avenues of opportunity along these lines in the UK.

“if you took all of the methane that is produced across the world and burnt it to generate electricity, there would be enough to meet the annual demand of Germany.”

Wheeler is not looking to set up solar farms or wind farms in the UK, as he says there are already a good number of competent and established generators, rather he is looking at the wasted or stranded energy that he can convert into a valuable asset, namely Bitcoin.

While producing Bitcoin is fundamental to the business in Renewablox, Wheeler is looking at the project as a solution to decarbonization and becoming netzero when it comes to energy.

“Bitcoin is just good use of stranded energy; another use might be other energy hungry consumers such as datacentres.”

As Wheeler points out, moving energy around is most important. “If you build a datacentre next to an anaerobic digester, you could use the excess heat from the datacentre to dry out the fuel to make it more efficient, or use the heat from the datacentre to heat a greenhouse or even a village community.”

Wheeler points to the recent reliance of the UK on gas which only proved a problem when Russia invaded Ukraine and as a result the UK suffered an energy crisis.

“It is very important to diversify our energy sources – and not to waste them.”

Wheeler points to the great success of a concept called community solar in the US where communities, especially renting families, can subscribe together to a community solar program and get power directly from the local solar installation.

“This is a solution to help people unable to fit solar panels as they don’t own the houses or cannot afford the expense. It is thinking outside the box.”

But an efficient large-scale solution requires significant capital, expertise and at least some on site presence, creating issues in all those categories that solar operators either don’t know how to overcome or simply have no interest in resolving. After all, they are energy producers, not Bitcoin miners.

What these operators need is a turnkey solution that can be tailored to their particular circumstances and modeled in detail, right from design stage if necessary, so that revenue streams are clear, calculable and provable. Accurate viability studies and financial models are complex and require a specific skill set that is fairly unique.

Renewablox has the skills needed to provide these services and, if necessary, access to capital, insurance and expertise; thereby allowing projects to proceed at any stage of development. This can be done on partnership, consultancy or ownership basis according to the requirements and risk appetite of the client.

In the case of deployment where grid connectivity is pending, a detailed assessment of the business model will be made at the point connection is available. The operator will then have the choice to either continue mining on an ongoing basis, or to switch wholly to their previous business model based on the agreements made and objectives set.

In short, it’s a simple, proven solution that carries an extremely high degree of flexibility.

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