What’s the size of a toaster and uses three times the energy of an average Pennsylvania household?
That would be a cryptocurrency mining machine — a computer that runs 24/7 and spits out numbers in an attempt to solve complex problems, creating proof-of-work cryptocurrency, like Bitcoin, as a result.
“We have companies that have 80,000 of them running at the same time constantly to try and guess numbers,” says Rob Altenburg, senior director for energy and climate at the advocacy organization PennFuture.
Cryptocurrency mining as a process came about with the advent of Bitcoin, which uses proof of work to validate transactions. “The reason why [miners are] generating Bitcoin is because there’s this large speculative bubble, and they can sell it to people,” Altenburg says.
Cryptocurrency relies on an independent ledger — the blockchain — that can be publicly accessed online instead of through banks and credit card companies, he explains. Validation methods offer protection from “malicious people trying to change the ledger to their own advantage,” Altenburg says.
“Proof of stake” and “proof of work” are the two main methods for cryptocurrency validation. Proof of stake is less energy intensive because it doesn’t rely on miners using electricity on duplicative processes as they do in proof of work — where miners are all rushing to be the first to guess the next correct number.
“In order to create new blocks to the blockchain, which is what mines Bitcoin … companies invest in very, very energy-intensive computer hardware,” Altenburg adds. It’s this hardware that runs in the crypto mining facilities that first began popping up across Pennsylvania about five years ago to create proof-of-work cryptocurrency. And the large amount of electricity required to power these machines is a major concern for environmental advocates.
Preliminary estimates from the U.S. Energy Information Administration suggest that annual electricity use from crypto mining represents from 0.6% to 2.3% of U.S. electricity consumption.
“That electricity has to be generated somehow, either off the grid or at a local power plant,” explains Charles McPhedran, senior attorney for Earthjustice, a national public interest law firm specializing in environmental law.
“If that power plant burns fossil fuel — gas or waste coal — then it generates greenhouse gasses, and it likely generates other forms of pollution, too,” he adds.
Crypto mining facilities also divert energy from homes and businesses that could be using it instead. “You’re dealing with all this air and water pollution to create something that’s not a public good,” says Russell Zerbo, a senior advocate at Clean Air Council, an environmental health advocacy organization.
One crypto mining operation 80 miles north of Philadelphia has recently caught heat from local activists. In March, the environmental group Save Carbon County filed a lawsuit against the Bitcoin mining company Stronghold Digital Mining for operations at its Panther Creek facility in Nesquehoning, where the company burns waste coal — low-quality refuse left behind from the coal mining of decades past.
“It’s more or less waste incineration,” Zerbo says of the practice. “It’s more dangerous than burning regular coal, which is incredibly dangerous, and we don’t really do that anymore.”
The residents of Carbon County are standing up to this crypto mining company, saying, ‘We don’t want your pollution, we don’t want your emissions.’”
— Zachary Feinberg, attorney for Save Carbon County
Save Carbon County claims Stronghold has created a public nuisance through its operations. “The residents of Carbon County are standing up to this crypto mining company, saying, ‘We don’t want your pollution, we don’t want your emissions,’” says Zachary Feinberg, an attorney for the group.
Residents also complained of a constant buzzing from the mining machines at the facility, property damage from coal refuse falling off trucks, and the burning of a mixture of old shredded tires at the facility. They cite concerns about benzyne and other chemicals from the tires being released into the air and waterways.
The permit for this practice has not yet been approved, but there was at least a trial period in which tires were temporarily burned, experts say; it’s not clear whether the practice continues. Residents still detect the smell of burning rubber, Feinberg says.
A spokesperson for Stronghold declined to answer questions for this article because of pending litigation. The company, which was formed in 2021, has a second Pennsylvania location in Venango County. According to Stronghold’s website, the company works to “reclaim the environment” by removing mining waste that would otherwise catch fire and pollute waterways.
But environmental advocates pushed back on this characterization.
“It’s greenwashing,” says McPhedran. “They’re trying to present their operations as environmentally friendly when the essence of what they’re doing is making greenhouse gases.”
The lawsuit also names the Commonwealth and some of its agencies, as well as Governor Josh Shapiro as defendants for failing to protect Pennsylvania’s public natural resources as required under the Environmental Rights Amendment of the Pennsylvania Constitution, Feinberg says.
Shapiro’s office did not respond to a request for comment in time for publication. A spokesperson from the Pennsylvania Department of Environmental Protection says the agency does not comment on pending litigation.
There’s been some legislative interest at the state level in finding solutions to the environmental concerns posed by crypto mining sites like the one in Nesquehoning.
State Representative Greg Vitali, D-Delaware County, introduced two bills related to crypto mining practices in 2023: HB 1282 and HB 1476. “Because of favorable tax laws, Pennsylvania is an attractive state for cryptocurrency mining,” explains Vitali, who is chairman of the House Environmental Resources and Energy Committee.
HB 1282 would prohibit crypto mining operations from taking advantage of a sales tax exemption for their equipment based on a program meant for computer data centers. The bill moved out of committee but was unable to get a floor vote.
Vitali also proposed HB 1476 to require crypto mining operations to report information to the state, such as what they’re doing and where they’re based.
Right now, crypto mining operations don’t have to report anything to the state aside from the information needed for traditional permitting required for all power plant facilities. That’s why experts only have estimates on how many crypto mining facilities exist in Pennsylvania.
Vitali’s bill would also require the state Department of Environmental Protection to compose a report on the environmental impacts of crypto mining.
The bill originally called for a two-year moratorium for crypto mining permits, but this measure was struck in order to move the bill out of committee. HB 1476 was sent to the State Senate in January.
Though there’s been no legislative movement since, Vitali and advocates say it’s important the government acts sooner rather than later. Urgency is essential for the state to get its arms around the greenhouse gas production caused by these crypto mining operations.
“Pennsylvania has seen the impact of fossil fuel across generations,” McPhedran says. “And we do not need a new way to burn fossil fuels either for our own health or the health of the planet.”
