The fact that the mining process in the crypto domain is energy intensive is not big news to practically everyone. The process of hashing has its requirements and they are directly related to the amount of energy the mining rigs use.
That is the reason why the miners’ search for energy sources that are affordable and accessible is a process that never ends. Recently, many mining ventures have been trying to change their operations to accommodate for an improvement in the energy consumption department.
Some have decided to change their locations for places that are more suitable for mining. Some have been trying to relocate to areas where electricity is bountiful and cheap. Others were focusing more on finding locations that provide natural cold areas so that their costs of cooling can be diminished.
However, a single company has drawn attention to it thanks to its choice of lowering the utility bills. Here is how the same Australian company by the name of IOT Group decided to drastically take the issue into their own hands. Also, will the same occurrence impact the otherwise growingly difficult situation in the crypto mining domain?
Starting up a Power Plant
Saying that the IOT Group is thinking outside of the box is a great understatement – the same venture decided to reopen a coal power plant for the purpose of running a mining network and its blockchain system. To do this, the company created a partnership with Hunter Energy and the plant they will be recommissioned is called Redbank. This power plant was closed down in 2014 but IOT has a plant that would see it reopen and begin producing energy directly to their mining business.
IOT plans to have its costs diminish for about 20% thanks to the plant and its energy output. However, it is not clear what would be the cost of starting up the plant and what taxes and other potential expenditures will the company have.
In spite of the unclear nature of this idea, many are finding the news both fascinating and relevant for the future of cryptocurrency mining. In fact, the initiatives like this could open up a whole new domain of industry – supplying energy to consumers from the field of the blockchain.
In general, anyone who decides to invest in energy today cannot be dismissed as making a bad move. The modern world is a place that very much runs on energy and this will not change even in the distant future.
Historically speaking, ever since the first industrial revolution took place, the concept is completely accurate – from coal to oil and nuclear fuel, the preferred types of energy have been changed from one source to another, but the industry was run by this energy expenditure.
Even before the first industrial revolution, places like Holland and Sweden were tapping into their sources of power like wind and water to run their heavy machinery like sawmills and windmills. Thanks to the same fact, no one could deny that having access to energy is a precursor to economic and financial success.
Now, it seems that crypto mining is discovering the same concept and trying to put into practice with dedicated sources of energy used only for their operation. However, while millions use digital currency like BTC for online betting, purchases, loans and everything else, many are wondering are decisions like making dedicated power sources really necessary?
Energy Savings Vs Energy Production
Ever since the cost of mining overcame the level where individuals could do it on their personal computers, the concept of attaining energy savings has been around. That is how the idea of mining rigs was born and the principle of using GPUs started to become widely used. The hardware improvement process is visible everywhere where digital devices are used, from eSports to serious scientific endeavors. Still, nowhere is it faster than in the crypto community.
In other words, people in the cryptocurrency community have been always ready to employ some means of attaining savings for these procedures. Later on, with the price boom, some companies started moving to the colder regions of the Nordic region and building facilities there to get a lower cooling bill.
But, there is no clear indication that this is the best possible move. If it was, there would be a mass migration of facilities to the regions closer to the poles. However, this is not happening mainly because a single unclear situation in terms of utility bills is exchanged with another similarly clear one.
The idea of becoming a provider of the needed energy is something else completely. It comes with the idea of being directly responsible for energy production needed for the mining, but also being open to many additional issues that come from running an energy-producing business.
This is a field onto its own and it comes with its challenges and requirements. There is hardly a chance that a tech company could simply wing it and start a business that produces energy without any great effort. It is more likely that the bureaucracy of the country they are in would demand a huge scope of licenses and approvals that have nothing to do with their primary business.
Renewables as a Potential Solution
While IOT has made the decision to open up a coal-power plant, this seems like a strange step from an environmental perspective. Today, most of the western nations are closing down their coal plants and there is a big certainty that this one will not last for long.
Because of that, the potential solution for anyone who is thinking about entering the energy sector could be to move to the green energy domain. These energy sources are definitely the way of the future and they make the most sense business-wise.
By investing in dedicated solar and wind-power generators, crypto miners anywhere will be fully able to produce their own energy and do not worry about the environmental side of the issue. This would also generate a lot of great feedback from the local community, which can be a big problem if it is not engaged positively by the mining ventures.