How much energy does bitcoin really use?
The estimates are over the place and more importantly, how do we know the energy source of miners? Miners are all around the world and are often unknown. How do we know if they're using renewable sources or coal? Some sources would be helpful.
<p>It is such a great question, and you're right about how hard it is to get sources!</p><p>While it is almost impossible to answer this question (for now) it is useful to consider the full context and implications of your question because it is a perfect window into our future.</p><p><strong>Why is it important?</strong></p><p>We live on a finite earth where very few resources are truly renewable. The "energy return on investment" (EROI) for our modern electricity /power generation infrastructures are a measurable figure (<a href="https://en.wikipedia.org/wiki/Energy_return_on_investment" target="_blank">see this wiki article</a>) and we think "Ah! That one has the best number - it is the best!". However it doesn't really take into account the time to develop the idea or tech, the pollution, the waste, the sustainability or the value/usability of the production. These all each have a cost too but we don't have agreed ways to measure them and so can't compare or evaluate them.</p><p><strong>Macro context</strong></p><p>As we begin to see the interconnectedness of our ecology and economies, some previously comfortable compromises need to be readdressed. For decades coal was a cheap and accessible fuel for power plants. Now we know that the diesel fuel the mining equipment uses and the pollution it creates when burned cost us more in other parts of the cycle.</p><p>When someone asks how much cryptos cost to mine, we're talking about the electricity/power the rig runs on, the sunk costs of production of the rig and chips, the power to run the cooling the rigs need, the sunk cost of the infrastructure for the power network and for the net connections and to some degree the human effort to manage the rigs (instead of creating code or tending a vegetable garden) and we don't yet have a way to measure the cost of disposal or recycling spent/outmoded rigs. </p><p><strong>Implications</strong></p><p>It is good to ask these questions, and rather than be down about how hard they are to answer, consider the power of asking more like them. How much energy does one USD cost to produce and manage? How much energy does it take to mint coins? Physical currency is expensive in many ways. Let's ask lots more questions until we know more about the EROI of our financial ecosystems (digital *and* physical), our food networks, our clothes, our computers and tablets. Only when we have a lot more comparable information about these types of things will we be able to make informed, rational decisions about what is the best way for our community to use resources for the best value. </p><p>I know that doesn't answer your question directly, but I hope it gives you some other ideas to explore on that topic. </p><p>If I was a miner, I would be setting up in <strong>Iceland </strong>or another cold country that has thermal-based grid power to get the double whammy of less expensive power and less need to pay for cooling. Tropical and sub-tropical countries are already pushing the equation uphill as efficient cooling requires a higher-quality of build for your housing/room.</p>
<p>Its very hard to tell what energy sources are actually used but what is sure is that the sources of energy will always be the cheapest forms of energy. A miners incentive is to move their operation to places in the world where electricity is the cheapest. These areas are usually areas where there are massive surpluses of energy due to over-engineered energy projects in the area. Miners will come to an agreement with energy providers to buy their excess energy production for cheap prices so that the energy capacity is not wasted. So miners basically absorb the energy that nobody else in the world wants. The main thing to remember here is that the power grid only has the ability to transport energy about 500 miles before energy losses in transmission become very significant, so miners have to physically move to these areas of cheap electricity.</p>
<p>Somewhere between 100-150 TWh. Interestingly, it's roughly the same as the consumption of global <a href="https://www.researchgate.net/publication/225802892_Electricity_and_water_consumption_for_laundry_washing_by_washing_machine_worldwide" target="_blank">washing machines</a>! ~100TWh</p>