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New York officials rule against bitcoin-mining power plant

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Vaughn Golden
/
WSKG News
The Greenidge Generation plant in Dresden, NY in the Finger Lakes

ALBANY, N.Y. (AP) State officials denied required air permit renewals Thursday to a bitcoin-mining power plant in the Finger Lakes that environmentalists called a threat to New York’s climate goals.

In rejecting the renewals, the state Department of Environmental Conservation said Greenidge Generation's “continued operations would be inconsistent with the statewide greenhouse gas emission limits" that New York is trying to meet under state law.

The company said it would continue operating under its current permit while it challenged the decision.

Greenidge, a former coal plant by the shore of Seneca Lake, was converted to natural gas several years ago and began bitcoin mining in earnest in 2020. Supporters say the plant provides a competitive way to mine cryptocurrency without putting a drain on the state’s power grid.

In a statement, the company insisted there was “no credible legal basis" for the denial.

“It is absurd for anyone to look at these facts and rationally claim that renewing this specific permit — for a facility that makes up a small fraction of the state’s electricity generation capacity — would impede New York’s long term climate goals. It simply would not," the company said.

But climate activists who see Greenidge as a test case asked Gov. Kathy Hochul’s administration to deny renewal of the plant’s air quality permit and to block similar projects. They argued the fossil fuel plant on Seneca Lake undercut the state’s policy of slashing greenhouse gas emissions in the coming decades under its 2019 climate law.

Greenidge harnesses inexpensive energy to run the huge computer arrays needed for energy-intensive “proof-of-work” cryptocurrency mining — a term for the computational process that records and secures transactions in bitcoin and similar forms of digital money. The plant also supplies power to the state’s electricity grid.

But in its letter to the company, the DEC said that “instead of helping to meet the current electricity needs of the state as originally described, the facility is operating primarily to meet its own significant new energy load caused by Greenidge’s PoW cryptocurrency mining operations. In this sense, contrary to the department’s previous understanding, the facility is creating a significant new demand for energy for a wholly new purpose unrelated to its original permit."

Environmentalists were pleased with the denial.

Yvonne Taylor, vice president of the advocacy organization Seneca Lake Guardian, said in a statement, “This is an incredible, precedent-setting moment for everyone who has fought side by side with the Finger Lakes community."

“Governor Hochul and the DEC stood with science and the people, and sent a message to outside speculators: New York’s former fossil fuel-burning plants are not yours to re-open as gas-guzzling Bitcoin mining cancers on our communities,” Taylor said in the statement.

The controversy over Greenidge pitted environmental groups against the crypto-currency industry and was seen as a political quandary for Hochul. The Democratic governor is trying to build wide support as she runs for election to the office she took over last year upon the resignation of Andrew Cuomo.

Hochul also will have to decide whether to sign a law that would establish a two-year moratorium on new and renewed air permits for fossil fuel power plants used for proof-of-work mining.

Greenidge is not affected by the first-of-its-kind moratorium measure, which covers new applications.

Greenidge has said that even if the plant ran at full capacity, its potential emissions equate to 0.23% of the state’s greenhouse gas emissions reduction target for 2030. The company argued the plant is 100% carbon neutral, thanks to the purchase of carbon offsets, such as forestry programs and projects that capture methane from landfills.

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