As Texas faces a rapid influx of bitcoin mining, its electrical infrastructure will need to support the expected additional industry electricity demand of 5,000 megawatts by 2023.
The Bitcoin mining industry in Texas currently uses between 500 and 1,000 megawatts of electricity. The Electricity Reliability Council of Texas (ERCOT) expects demand to quadruple by 2023, and is said to have planned an additional 3,000 to 5,000 megawatts.
This expansion comes as the Lone Star State plans to be home to 20% of the world’s bitcoin mining. Texas has become a destination for bitcoin miners since the Chinese government officially banned bitcoin mining earlier this year.
The state government capitalized on the collapse of China by turning Texas into a haven for crypto miners, who can now take advantage of a 10-year tax cut, sales tax rebates, and state-subsidized labor training.
However, some Texans worry that the current power grid cannot be improved. ERCOT’s control of the state’s electrical grid was investigated in February 2021 when the area experienced a power outage during a severe cold that left nearly 5 million residents without power for several days.
The November 19 ERCOT report did not provide confidence that the network problems had been resolved. Texas Observer reporter Amal Ahmed tweeted on November 22:
“The new (mostly expected) seasonal assessment report from ERCOT appears to indicate that it should come as no surprise that the agency has not changed its approach at all to truly prepare for extreme conditions.”
Related: The Singapore-based tech company claims to recycle 90% of waste heat from bitcoin mining.
Some miners have tried to allay residents’ fears of potential resource depletion. On October 21, Texas Standard reported that some bitcoin miners had worked with local electricity providers to ensure the stability of the network.
Meanwhile, many others intend to work with alternative and fully renewable energy sources such as gas stoves as BTC mining becomes more environmentally friendly.
There are currently no proposals from the Texas government to address the potential problems that could arise from the increased demand for electricity from crypto miners. Under the Texas Standard, miners can be flexible when it comes to shutting down equipment during periods of high demand, or charging extra per kilowatt-hour if they want to keep operating during periods of high demand.