The United States Department of Energy (DOE) is taking significant steps to monitor the energy consumption of cryptocurrency mining operations. This move comes amid rising concerns over the environmental impact of such activities, especially following a recent surge in Bitcoin prices.
On January 31, the U.S. Energy Information Administration (EIA), a statistical branch of the DOE, announced the initiation of a temporary survey aimed at assessing the electricity usage of domestic cryptocurrency mining companies. Starting next week, crypto miners will be obligated to provide detailed information about their energy consumption.
The survey was approved on January 26 by the Office of Management and Budget, following an emergency request from the EIA. This request was spurred by a significant increase in Bitcoin’s price — about 50% over the past three months — which is believed to encourage more crypto mining activities, consequently leading to higher electricity consumption. However, data from Cointelegraph Markets Pro indicates that Bitcoin (BTC) actually rose by approximately 18.5% in the three months leading up to January 24.
The EIA is also seeking public comments on the energy usage of crypto miners. Joe DeCarolis, the EIA Administrator, stated that the survey aims to understand how the demand for energy in cryptocurrency mining is evolving, identify regions with rapid growth, and determine the sources of electricity used in crypto mining.
The United States has become a major hub for crypto mining, especially after China’s ban on the practice in 2021. This development has led to increased scrutiny from U.S. lawmakers. In 2022, a congressional hearing probed the mining industry over concerns about energy consumption and fossil fuel emissions. Early in 2023, Congress requested the Environmental Protection Agency to investigate the environmental impact of crypto mining.
In 2023, U.S. President Joe Biden proposed a 30% incremental tax on the electricity costs of crypto miners, aiming to reduce mining activities in the country. This proposal reflects growing concerns about the environmental footprint of cryptocurrency mining.
According to Cambridge University’s Bitcoin Electricity Consumption Index, Bitcoin miners globally consumed an estimated 121.13 terawatt-hours of electricity in 2023, a record high since 2010. This figure surpasses the total energy consumption of Belgium, which was 93.8 terawatt-hours in 2022, as per the International Energy Agency (IEA). The IEA further forecasts that crypto mining could consume up to 160 terawatt-hours by 2026, highlighting the urgent need for regulatory measures and sustainable practices in the industry.
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