After 78 Degree Fall Weekend, Advocates Demand NY Gov. Hochul Put Climate Over Crypto

As Greenidge’s stock hits record lows and crypto tanks, pressure builds on Governor to sign moratorium and curb climate change-accelerating industry

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Climate and Energy

For Immediate Release

The day after Election Day, advocates are demanding that Governor Kathy Hochul prioritize signing the cryptomining moratorium (A.7389-C/S.6486-D), which the NYS Legislature passed in June. She has until the end of the year to sign the legislation. Governor Hochul has repeatedly responded to questions about whether she’ll sign the moratorium by claiming she has hundreds of bills to review, while acknowledging the important decision of denying Greenidge Generation’s air permit (most recently mentioned in Gothamist). Prior to Election Day, Governor Hochul signed 600 bills. 

Championed by Assemblymember Anna Kelles and Senator Parker, the bill would put a two-year moratorium on new and renewed air permits for fossil fuel power plants that house proof-of-work cryptocurrency mining, and require the Department of Environmental Conservation (DEC) to conduct a study into the practice’s environmental impacts. 

Food & Water Watch Senior New York Organizer Eric Weltman said:

“Governor Hochul is still stalling on the most important piece of climate legislation that passed this year. If she’s got time to read and sign 600 bills since June, she’s got time to get this done. Governor Hochul must press the pause button on burning fracked gas for Bitcoin mining and sign the crypto-moratorium bill collecting dust on her desk — it’s a necessary step towards moving New York off fossil fuels and meeting our climate goals.”

“It hit 78 degrees this past weekend in the Finger Lakes, and the Governor is still stalling on any meaningful action around cryptomining while we sunbathe in November. We’re sick of excuses, and we’re sick of the Governor siding with an industry that’s lost 50% of its value since last year over the health and safety of New Yorkers,” said Yvonne Taylor, Vice President of Seneca Lake Guardian. “Shut down Greenidge now.”

Advocates are also demanding Governor Hochul shut down the fracked gas-powered Bitcoin mine Greenidge Generation. The NYS Department of Environmental Conservation (DEC) denied Greenidge’s air permit renewal in June stating that the facility poses a threat to the state’s climate goals. But Greenidge is still operating and even expanding as it appeals the DEC’s decision. It’s also attempting to renew its water permit without having met the conditions of its expired water permit. Meanwhile, the company’s stock is tanking – down to a record low ~$0.71/share, from $17.29/share in January 2022. Its CEO abruptly stepped down in October, and Atlas Holdings, the Connecticut-based private equity firm that owns Greenidge, replaced him with a pair of executives affiliated with the firm. In a statement announcing the shakeup, Greenidge projected $22 million in losses for the 2022’s third quarter, and reported losing $107.9 million in the second quarter.

“Cryptocurrency mining should not come at the expense of our climate or the health and livelihoods of people living near the fossil fuel plants that power crypto operations. Governor Hochul must be the climate champion she says she is and protect New York’s climate mandates. It’s time to sign the cryptocurrency mining moratorium bill and shut down Greenidge Generation,” said Liz Moran, New York Policy Advocate for Earthjustice.

“FrackBustersNY believes it’s a crime to usurp energy from the public for private profit, such as Bitcoin and other cryptomining facilities do. Please sign the bill to stop power plants from being used to produce cryptocurrencies. Keep NY cool when it should be!” said Mary Finneran, FrackBustersNY co-founder.

“We cannot waste even one more day playing whack-a-mole in our local communities while Bitcoin mining in New York is wreaking havoc on our stated climate policies, polluting our communities, ravaging our energy supply and raising our energy costs. So much is at stake. Governor Hochul’s actions will have real life consequences for New Yorkers for decades to come.  We implore Governor Hochul to immediately sign the cryptocurrency mining moratorium bill the New York State legislature passed last spring and uphold the decision to deny the Greenidge air permit,” said Ellen Weininger, Director of Educational Outreach at Grassroots Environmental Education.

Last month, nearly 500 organizations, businesses, wineries, labor, and faith groups sent a letter to Governor Hochul strongly urging her to sign the cryptomining moratorium without delay. Signatories include 1199 SEIU, Action Center on Race and the Economy, Earthjustice, Finger Lakes Business Coalition, Food & Water Watch, WEACT for Environmental Justice, and NY League of Conservation Voters.

Opponents of the cryptomining moratorium argue that it will kill the industry. The argument is clearly false: On September 15, industry giant Ethereum successfully “merged” from the energy-intensive proof-of-work mining method to proof of stake, reducing the cryptocurrency’s energy consumption by 99.95%. Ethereum is the second largest cryptocurrency (after Bitcoin) and its merge confirms that the industry can innovate and upgrade to more sustainable business practices.

Even the White House is sounding the alarm about cryptomining — in September, the Office of Science and Technology Policy released a report about the industry’s climate threats and the need for regulation. But cryptomining continues to grow rapidly across New York and the country. Earthjustice and the Sierra Club recently released a new Guidebook, finding that from July 2021-22 Bitcoin mining in the U.S. alone consumed as much electricity as four states combined, emitting 27.4 million tons of CO2 – equivalent to the emissions of as much as 6 million cars annually.

Greenidge isn’t the only cryptomining operation threatening New York’s climate goals while harming New Yorkers and creating few jobs but big profits for an out-of-state corporation. In September, the New York Public Service Commission approved the sale of the Fortistar North Tonawanda power plant (FNT) to Digihost, a Canadian cryptomining company. Digihost has already been mining Bitcoin at the facility using power sourced from the grid, and is now one step closer to generating its own power with fracked gas for proof-of-work cryptomining. Over the last five years, FNT has only produced energy as a peaker plant between 2% and 13% of the time, emitting relatively small amounts of CO2 and other harmful air pollutants. Now Digihost will be able to pursue operating 24/7/365, multiplying its greenhouse gas emissions by up to 3000%, all while the rest of New York works to drastically reduce its greenhouse gas emissions. 

Greenidge and FNT are just the beginning, which is why advocates are calling on Governor Hochul to sign the cryptomining moratorium before more outside speculators take advantage of New Yorkers, just to make rich people richer.

Background

On June 30, after more than a year of advocacy by residents, business owners, wine makers, environmental activists, and elected officials, the New York State Department of Environmental Conservation (DEC) denied Greenidge Generation a renewal of its Title V Air Permit. Greenidge has been operating as a 24/7 proof-of-work cryptocurrency mining facility for Bitcoin under grandfathered in permits for other usage.

Located on the shores of Seneca Lake, Greenidge is a once-mothballed power plant that was converted into a bitcoin mine by the private equity firm that owns it. The plant has brought only 48 new jobs to the region compared to the existing $3 billion agritourism economy, employing approximately 68,000 people, while poisoning the Finger Lakes’ natural resources. With over 17,000 Bitcoin machines and plans to expand to 32,500, if permitted to continue operating and expanding, Greenidge would emit over one million tons of CO2 each year, equivalent to that of 100,000 homes. Greenidge also sucks 139 million gallons of water each day from Seneca Lake and dumps it back in at up to 108 degrees, risking toxic algal blooms that could make this water source for 100,000 people non-potable. 

Gothamist recently reported, “The company has added about 10,000 computers and mined about 300 bitcoins in July alone, which would be worth more than $6 million. Their hash rates, a unit of how much power the bitcoin network is using, increased by nearly 70% over the last four months.” The added computers mean more greenhouse gas emissions (it’s on track to emit at least as much as 100,000 homes), more harm to Seneca Lake (a new study confirms that Greenidge’s operations are warming the lake), and a bigger threat to the local $3 billion agritourism industry that employs 68,000 people — all for the 48 jobs that Greenidge has brought to the region. 

Greenidge is just the beginning, and advocates are urging Governor Hochul to put a statewide moratorium on proof-of-work cryptomining. New York hosts a significant portion of the U.S.’s Bitcoin mining to the detriment of small businesses, local economies, the environment, and the climate. After China banned cryptomining, citing the environmental threats the practice poses to meeting emissions reduction goals, outside speculators have flocked to upstate New York to take advantage of our clean air, cool temperatures, fresh water, and lack of cryptocurrency mining  environmental regulations. 

Proof-of-work cryptocurrency mining is an extremely energy intensive process that threatens the ability of governments across the globe to reduce our dependence on climate-warming fossil fuels. Mining requires thousands of machines whirring 24/7 to solve complex equations. The more machines that are running, the faster a coin is mined. Each one of these machines requires energy to run, plus more energy for cooling. Globally, Bitcoin mining consumes more energy each year than the entire country of Argentina. In the U.S. alone, Bitcoin mining produces an estimated 40 billion pounds of carbon emissions each year. Cryptocurrency mining facilities are major emitters of air pollutants. And when cryptocurrency miners rely on the public grid, they can stick everyday people with the bill. A 2021 study estimates “the power demands of cryptocurrency mining operations in upstate New York push up annual electric bills by about $165 million for small businesses and $79 million for individuals.”

Powering Bitcoin mining with renewables is not a viable solution, as renewables supply cannot possibly meet the extreme energy demands of Bitcoin mining in addition to daily necessities such as heating and cooling homes and running cars. Any renewable energy that supports Bitcoin mining is renewable energy that is being diverted from the public grid. 

At an Environmental Conservation budget hearing when asked about the potential impact of the escalating cryptocurrency mining activity in upstate NY on the state’s energy grid, the NYS Energy Research and Development Authority (NYSERDA) President Doreen Harris stated, “There could be a very significant impact on NY load resulting from cryptocurrency mining depending on the penetration of the resource.”

Cryptomining is also at odds with the overwhelmingly popular amendment to the state constitution passed last year, which guarantees every New Yorker the right to clean air, clean water, and a healthful environment. Revitalizing old polluting power plants for private financial gain, with drastic consequences for our air, water and climate, all while causing huge amounts of noise pollution, is now unconstitutional – and ought to be treated as such.

Reform groups Common Cause/NY and NYPIRG have specifically criticized the crypto mining industry for exploiting public resources and straining the energy grid for private gain, and a group of federal lawmakers led by Senator Elizabeth Warren requested details from six major Bitcoin mining companies about their electricity usage and contributions to climate change.

More than 1,000 organizations, businesses, environmental activists, concerned residents, wine makers, elected officials, and more have taken action over the last year in opposition to crypto mining in New York State. A letter sent to Governor Hochul in October was signed by more than 650 individuals and groups. In letters to Governor Cuomo last year opposing Greenidge Generation‘s expansion from an emergency peaker plant to a 24/7 Bitcoin mining operation, organizations, businesses, and Finger Lakes residents demanded Gov. Cuomo revoke Greenidge’s permits due to its massive greenhouse gas emissions, poisoning of the Finger Lakes, and noise pollution, with no economic benefit to the community. Similar fights have occurred in Plattsburgh and Niagara Falls, which resulted in local moratoriums.

Contact: Phoebe Galt, [email protected]