A quantification of how much crypto-miners are driving up the wholesale cost of energy in Texas

Jangho Lee; Lily Wu; Andrew E. Dessler

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arXiv · 2302.02221

A quantification of how much crypto-miners are driving up the wholesale cost of energy in Texas

Jangho Lee·Lily Wu·Andrew E. Dessler

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Abstract

The use of energy by cryptocurrency mining comes not just with an environmental cost but also an economic one through increases in electricity prices for other consumers. Here we investigate the increase in wholesale price on Texas ERCOT grid due to energy consumption from cryptocurrency mining. For every GW of cryptocurrency mining load on the grid, we find that the wholesale price of electricity on the ERCOT grid increases by 2 per Cent. Given that todays cryptocurrency mining load on the ERCOT grid is around 1 GW, it suggests that wholesale prices have already risen this amount. There are 27 GW of mining load waiting to be hooked up to the ERCOT grid. If cryptocurrency mining increases rapidly, the price of energy in Texas could skyrocket.

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Jangho Lee, Lily Wu, Andrew E. Dessler. 2023-02-04. A quantification of how much crypto-miners are driving up the wholesale cost of energy in Texas. https://arxiv.org/abs/2302.02221

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