New study: clean energy powers 39% of cryptocurrency mining

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The ‘3rd Global Cryptoasset Benchmarking Study’ reveals that the share of clean energy in the total energy consumption of cryptocurrency proof-of-work mining globally has reached 39%.
This compares with the 28% share which was recorded in the 2nd benchmarking study in 2018 and is despite the approximate 75/25 split between those who use renewables as part of their mix and those not using any at all remaining similar.
Almost two-thirds of participants (62%) report that hydropower is their number one source of energy. However, wind and solar (17% and 15% respectively) are well down behind coal and natural gas (38% and 36% respectively).
Additionally, there are significant variations both within and across regions, specifically Asia-Pacific, Europe and North America. The median percentage of renewables in Europe and North America is relatively high, about 70% and 66% respectively, while the median in Asia-Pacific is much lower at 25% with the level of coal use matching that of hydro.
The study shows China’s oversupply of hydropower during the rainy season has been used as evidence mostly in claims that a vast majority of mining is powered by environment-friendly power sources. The same strategy of energy self-sufficiency which has resulted in the development of massive hydro capacity also has driven the construction of large-scale coal plants and the latter’s obvious use in powering mining operations.
Bitcoin energy demands
The energy demands of the mining of Bitcoin and other cryptocurrencies like Ethereum, Litecoin and Monero has raised concerns over its growth and scale. The 2nd benchmarking study predicted the consumption of the top six cryptocurrencies between 52TWh and 111TWh per year. The new study does not mention an update to these figures or any growth since that time.
The other important result of the study from the sector perspective is the role of electricity in the cost structure of cryptoasset miners. Utility costs account for almost 80% of their operational costs and from 21% in Latin America to 49% in Asia-Pacific of their total costs.
The vast majority of miners no longer pay residential electricity prices but often access preferential/industrial pricing through contractual agreements with power generators, the study reveals.
The average price for electricity paid by miners is US$0.046/kWh. The lowest average price, US$0.025/kWh is in Latin America and the Caribbean.
The study from the Cambridge Centre for Alternative Finance (CCAF) at the Cambridge Judge Business School is based on data gathered from 280 entities from 59 countries. “Understanding the energy source of mining is important because electricity costs account for the majority of hashers’ operational expenditures and hashers have long competed on accessing the cheapest energy source,” it says.
A further shift to renewables and any reduction in prices will support further competition and maturation of this industry, which is still growing well (21% in 2019) although not that of its past frenzy.

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