Texan Crypto Mining Operations Must Seek Approval Before Tapping Into Power Grid

Texas has become a mecca for crypto mining due to its abundance of lower-cost renewable energy, but there are growing concerns regarding power grid stability.

The lone star state has begun requiring large-scale crypto mining operations to seek permission to access the state power grid. The move comes in anticipation of increasing demand for power as more mining facilities set up shop in Texas.

According to reports, the Electric Reliability Council of Texas (ERCOT) is now requiring utilities to submit studies on the impact of mining farms tapping the grid before they can get “approval to energize.” Council members will conduct a vote to form a task force with the ultimate aim of protecting the grid from being overwhelmed.

There has been a surge in demand from Bitcoin mining companies and the grid failed to withstand a deadly winter that struck the state last year. Texan authorities are planning to prevent a recurrence of this.   

Crypto mining power concerns

Several gigawatts of demand are expected to be added this year by crypto mining firms. Previously, the utilities themselves performed their own studies on power demands. Under the new requirements, any project adding 20 megawatts of demand on the generator site within the next two years will have to undergo the review process.

The minimum threshold for review is 75 megawatts for operations that do not generate their own power.

“We are entering into a dialogue with ERCOT now to ensure that this does not cause any delays for the Bitcoin miners,” stated Lee Bratcher, president of the Texas Blockchain Council.

There have been growing concerns over the power consumption of Bitcoin mining following the influx of companies to the country in the aftermath of China’s prohibition.

Earlier this week Greenpeace launched a campaign to change the core code of the Bitcoin network to something other than proof-of-work. The “Change the code, not the climate” campaign which was headed by Ripple co-founder Chris Larsen, wants to do away with mining and follow Ethereum’s environmentally friendlier path.

Kentucky coal town revival

In related news, Kentucky is also becoming a hotbed of mining activity as companies seek to rejuvenate old coal towns and tap into tax incentives.

According to Tech Crunch, crypto mining firms are repurposing abandoned coal mining sites and developing sustainable energy generation methods to power their machinery. Earlier this month, BeInCrypto reported that Blockware Solutions was one such firm digitizing coal in Kentucky.