A United States Senator, Steve Daines, has warned that the planned closure of all four units of a coal plant in Colstrip, Montana will not bode well for the state’s Bitcoin mining business.
Coal Plant Closure will Affect Bitcoin Miners
On Tuesday (August 21), Montana’s growing Bitcoin mining business formed a subject of discussion in the United States Senate. In a meeting of the Senate Energy and Natural Resources Committee, Senator Steve Daines discussed the link between Bitcoin mining centers and the coal-fired plant in Colstrip.
Senator Daines warned that if all four units of the Colstrip plant shut down as planned in 2027, Montana’s booming Bitcoin mining business could be badly affected. In the Senator’s view, low-cost energy will go a long way in helping and expanding Bitcoin mining businesses.
The Senator further commented, saying,
“As the demand for Bitcoin miners increases and supply of cheap, reliable electricity from coal generation decreases, this could pose a threat of the expansion of Bitcoin generation and an even greater threat to energy supply and prices for Montana as a whole.”
Members of the panel, however, did not agree with Senator Daines’ concerns. In their response, they believe that when one major provider is suddenly out of the market, many utility companies will look for an alternative source of power. These companies will keep the amount available, and the price will remain the same for customers.
Two of the largest Bitcoin mining operations in North America are located in western Montana. Cryptocurrency mining operations find Montana favorable because of its cold climate and low energy cost.
Suggested Reading : Learn more about Bitcoin mining in our ‘What is Bitcoin?‘ beginner’s guide.
The Quest for Cheaper Electricity Supply to Support Bitcoin Mining
Cryptocurrency mining generates a tremendous amount of heat. Thus, industrial cooling systems are required. For this reason, miners prefer to situate their facilities in cold climate regions to offset some of their energy costs.
According to a December 2017 article, international investors were seeking out Manitoba, Canada, as a favorable location for cryptocurrency mining. This is due to the city’s cheap electricity and cold weather, two core factors necessary for crypto mining.
In August 2018, however, DPW Holdings, Inc., made an announcement that could have profound implications for the industry. The company revealed its plans to use the New York hydroelectric dam Valatie Falls as a fully-dedicated source of low-cost and renewable power for a new cryptocurrency mining farm. This will be functional in that last quarter of 2018.
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