Huffman, Warren, Colleagues, Call on Environmental Protection Agency and Department of Energy to Require Cryptomining Companies to Disclose Energy Use and Emissions

Lawmakers Release Responses from Seven Large Cryptomining Companies Showing Extraordinarily High Energy Use and Climate Impact from Cryptomining Biggest Cryptominers Use Enough Energy to Power all Residences in Houston, Texas

July 15, 2022

Washington, D.C. – Congressman Jared Huffman (D-Calif.) and U.S. Senators Elizabeth Warren (D-Mass), Sheldon Whitehouse (D-R.I.), Edward J. Markey (D-Mass.) and Jeff Merkley (D-Ore.) and Representative Rashida Tlaib (D-Mich.) sent a letter to the Environmental Protection Agency (EPA) and the Department of Energy (DOE), highlighting findings from their investigation into the environmental impacts of cryptomining and requesting that the EPA and DOE work together to require cryptominers to report their emissions and energy use. Text of the letter can be found here.  Responses from seven of the cryptominers to the lawmakers’ letters can be found here.

“The results of our investigation… are disturbing… revealing that cryptominers are large energy users that account for a significant – and rapidly growing – amount of carbon emissions. Our investigation suggests that the overall U.S. cryptomining industry is likely to be problematic for energy and emissions. But little is known about the full scope of cryptomining activity. Given these concerns, it is imperative that your agencies work together to address the lack of information about cryptomining’s energy use and environmental impacts, and use all available authorities at your disposal…  to require reporting of energy use and emissions from cryptominers,” wrote the lawmakers.

Cryptomining’s energy usage rivals that of entire countries. The total annual global electricity consumption associated with just the two largest cryptocurrencies by market capitalization, Bitcoin and Ethereum, has been comparable to the annual electricity usage of the United Kingdom and resulted in almost 80 million tons of carbon dioxide emission in 2021. This substantial energy use also drives up electricity costs for consumers and small businesses. According to a recent study, “the power demands of cryptocurrency mining operations in upstate New York push up annual electric bills by about $165 million for small businesses and $79 million for individuals.”

The lawmakers note that state and federal regulators know very little about the full scope of electricity use and emissions associated with cryptomining, given the lack of national or state reporting requirements and data about the locations and operations of cryptomining facilities.

In December 2021 and January 2022, the lawmakers sent letters to seven large cryptomining companies, seeking information about the locations of their facilities, their energy sources and consumption, and the climate impacts associated with this production. While the companies did not provide full and complete information, their responses and the lawmakers’ investigation revealed the following:

  • Cryptominers are using substantial amounts of electricity: The seven companies alone indicated that they presently have developed over 1,045 MW capacity for cryptomining. This is enough capacity to power all the residences in Houston, Texas.
  • Cryptominers are significantly increasing production: Although miners are already using a significant amount of energy, the companies indicated that they expect considerable increases in mining capacity and energy use in the coming years. The limited set of information provided by the seven cryptominers indicates that they will increase their total capacity by nearly 230%, enough new capacity to power a city of 1.9 million residences.
  • Cryptomining results in substantial amounts of carbon emissions: Several of the companies insisted that their mining efforts were environmentally friendly and did not have a significant adverse impact on climate and air quality. These same companies reported millions of tons of carbon dioxide emissions resulting from the energy needed to power their operations.
    • Just three companies that provided clear emissions data are currently responsible for approximately 1.6 million tons emitted annually, the equivalent of almost 360,000 cars.
    • The current energy use of cryptomining results in large amounts of carbon emissions and other adverse impacts on air quality, local environments, and the electric grid, and prevents the use of that energy for other priorities that could contribute toward electrification and climate goals.

The lawmakers are calling on the EPA and DOE to use their authority to require reporting about cryptomining’s energy use and environmental impact and answer a series of questions about their ability and plans to require this reporting by August 15, 2022.

Rep. Huffman has been a leader in the House of Representatives for reining in cryptocurrency to protect consumers and the environment. In April 2022, he led his colleagues in a letter to U.S. Environmental Protection Agency Administrator Michael Regan regarding reports that cryptocurrency facilities across the country are polluting communities and are having an outsized contribution to greenhouse gas emissions. In June, 2022, he sent a letter to the Office of Science and Technology Policy in response to the public comment period on Biden’s Executive Order related to energy and climate implications of digital assets.