Bitcoin mining – improvements in sustainable power mix, technological efficiency
The Bitcoin Mining Council has reported that its members are now using electricity with an almost two-thirds sustainable power mix.
Based on this and other data the Council estimates that the global Bitcoin mining industry’s sustainable electricity mix has grown to reach approximately 58.5% by the end of 2021, up 1% from Q3 and 2.5% from the first Q2 2021 survey.
The Council also estimates the global network’s technological efficiency at 19.3 petahash/MW at the end of 2021, a 9% improvement during the last quarter of the year.
“This quarter we saw the trend continue with dramatic improvements to Bitcoin mining energy efficiency and sustainability due to advances in semiconductor technology, the rapid expansion of North American mining, the China exodus and worldwide rotation toward sustainable energy and modern mining techniques,” commented Michael Saylor, CEO of US-based business intelligence company MicroStrategy and founder of the Council.
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The Bitcoin Mining Council is a voluntary global forum of Bitcoin mining companies and other in the industry.
The members and other companies surveyed on their Q4 energy usage are believed to make up almost half of the global Bitcoin network.
Notably in the Q4 2021 data collection and going forward, the Council has excluded renewable energy credits from its ‘sustainable power’ definition.
The Council advocates that Bitcoin mining uses an inconsequential amount of energy at 0.14% of the world’s energy production and that it is powered by a higher mix of sustainable energy than any major country or industry.
Looking ahead the Council estimates improvements in mining efficiency of 3x in the next four years and 2x in the four years thereafter. Coupled with the Bitcoin protocol reducing energy consumption incentives by 2x every four years, Bitcoin mining is “guaranteed to be dramatically more energy efficient in the next eight years,” says the Council’s Q4 report.
Despite this optimistic assessment, the Bitcoin mining industry undoubtedly in the future will continue to come under the spotlight for its energy consumption. With energy prices a key input to the profits, miners look for locations with the lowest energy prices, resulting in concentrations of activity, such as in Sweden and other Nordics.
That rather than the overall energy consumption is likely to be the focus of attention, particularly from the countries where this is occurring.
