6 ms·

Bitcoin energy use in Iceland set to overtake homes, says local firm

38 points by fredley 9y ago

moocowtruck 9y ago
so much for all that environmental friendly iceland!
- otoburb 9y ago
  The article states "[Iceland] has seen a marked increase in the number of new data centres, often built by firms wishing to tout green credentials. Nearly 100% of energy in Iceland comes from renewable sources." Unless that's false, Iceland looks like it is still about as environmentally friendly as it was before agreeing to build Moonlite. Perhaps the more interesting question is what Iceland will do to meet the increase in domestic energy demand. Presumably a crude first-order response will be to increase input costs across the board by jacking up commercial electricity rates (assuming they can differentiate between retail vs. commercial facilities).
otoburb 9y ago
>>Smari McCarthy, a member of the Icelandic parliament for the Pirate Party, tweeted: "Cryptocurrency mining requires almost no staff, very little in capital investments, and mostly leaves no taxes either. Replace "cryptocurrency" with any other technology service and you'll probably be left with the same net result. The datacenter is presumably charging for the co-location services, so there's certainly tax revenue and the operational jobs (as few as they are) to run the facilities that benefits Iceland.
- gruez 9y ago
  also, >very little in capital investments what? it doesn't require huge upfront capital compared to say, building a factory, but risk in buying mining equipment is insane given how volatile the price/difficulty is.
  - otoburb 9y ago
    You're correct, but I believe the MP was referring to the fact that any such capital assets (e.g. miners/servers) are being purchased outside of Iceland, so no tax revenue accrues to Iceland (except maybe indirectly in the form of import duties or shipping costs).
    - gruez 9y ago
      >are being purchased outside of Iceland ...as opposed to any other business? if you're setting up any kind of business[1], chances are most of the capital investments won't be goods from iceland. [1] other than ones centered around processing raw resources https://upload.wikimedia.org/wikipedia/commons/7/77/Iceland_Export_Treemap.jpg https://upload.wikimedia.org/wikipedia/commons/7/77/Iceland_...
bittcto 9y ago
This is an example of bitcoin mining seeking the most renewable, inexpensive energy sources... including geothermal in iceland and hydroelectric in Washington State and China. As solar or wind get closer to viability, it may soon come that bitcoin starts paying for massive solar investment (due to the "greedy" interests of miners buying up lots of solar capacity) and that further lowers costs of solar... and maybe wind, though I'm less confident on wind.
- danmaz74 9y ago
  On the contrary, bitcoin using up a lot of solar installation would only displace using the same solar panels for other uses.
  - nk1tz 9y ago
    Implying it won't accelerate the development of more/better solar.
    - danmaz74 9y ago
      There is already a huge demand for electrical power in the world, especially clean one. Bitcoin won't add anything specific for solar.
      - kfriede 9y ago
        There is huge demand for electrical power, but there is only huge desire for clean electrical power. I'm sure Bitcoin miners want to use clean power, but if it means they have tighter margins as a result, then non-clean will be what they stick with. (Bitcoin used only as placeholder here).
  - bittcto 9y ago
    You're making the zero sum economic fallacy. More demand for solar panels finances more panels growing, increasing economies of scale reducing panel costs, and also, quite literally growing the total capacity of panels available in the world.
xutopia 9y ago
This is why there is a huge gold rush in Quebec. We have cheap electricity year long and cheap cooling 9 months of the year.
- supbitcoin 9y ago
  True, I have a friend who is building a mining operation of 112 MW in the North
martin1975 9y ago
In other words, proof-of-stake is the future. Legacy PoW coins will stick around, but they will not be dominant.
bmcusick 9y ago
Bitcoin is a great export product for Iceland. Their biggest disadvantage is being so remote from the rest of the world, so the ability to produce something locally that has zero shipping costs isn't one to be missed. It's effectively a way of turning local geothermal power into money, providing tax revenues to all sorts of services.
njarboe 9y ago
While it does sound impressive, as stated in the article, Iceland has only 340,000 people. And almost all heating is done with geothermally heated water further reducing residential electricity costs. Compared to the electricity of aluminum smelting business in Iceland, bitcoin very small (so far).

38 points by fredley 9y ago

moocowtruck 9y ago

so much for all that environmental friendly iceland!

otoburb 9y ago
The article states "[Iceland] has seen a marked increase in the number of new data centres, often built by firms wishing to tout green credentials. Nearly 100% of energy in Iceland comes from renewable sources." Unless that's false, Iceland looks like it is still about as environmentally friendly as it was before agreeing to build Moonlite. Perhaps the more interesting question is what Iceland will do to meet the increase in domestic energy demand. Presumably a crude first-order response will be to increase input costs across the board by jacking up commercial electricity rates (assuming they can differentiate between retail vs. commercial facilities).

otoburb 9y ago

>>Smari McCarthy, a member of the Icelandic parliament for the Pirate Party, tweeted: "Cryptocurrency mining requires almost no staff, very little in capital investments, and mostly leaves no taxes either. Replace "cryptocurrency" with any other technology service and you'll probably be left with the same net result. The datacenter is presumably charging for the co-location services, so there's certainly tax revenue and the operational jobs (as few as they are) to run the facilities that benefits Iceland.

gruez 9y ago
also, >very little in capital investments what? it doesn't require huge upfront capital compared to say, building a factory, but risk in buying mining equipment is insane given how volatile the price/difficulty is.
- otoburb 9y ago
  You're correct, but I believe the MP was referring to the fact that any such capital assets (e.g. miners/servers) are being purchased outside of Iceland, so no tax revenue accrues to Iceland (except maybe indirectly in the form of import duties or shipping costs).
  - gruez 9y ago
    >are being purchased outside of Iceland ...as opposed to any other business? if you're setting up any kind of business[1], chances are most of the capital investments won't be goods from iceland. [1] other than ones centered around processing raw resources https://upload.wikimedia.org/wikipedia/commons/7/77/Iceland_Export_Treemap.jpg https://upload.wikimedia.org/wikipedia/commons/7/77/Iceland_...

bittcto 9y ago

This is an example of bitcoin mining seeking the most renewable, inexpensive energy sources... including geothermal in iceland and hydroelectric in Washington State and China. As solar or wind get closer to viability, it may soon come that bitcoin starts paying for massive solar investment (due to the "greedy" interests of miners buying up lots of solar capacity) and that further lowers costs of solar... and maybe wind, though I'm less confident on wind.

danmaz74 9y ago
On the contrary, bitcoin using up a lot of solar installation would only displace using the same solar panels for other uses.
- nk1tz 9y ago
  Implying it won't accelerate the development of more/better solar.
  - danmaz74 9y ago
    There is already a huge demand for electrical power in the world, especially clean one. Bitcoin won't add anything specific for solar.
    - kfriede 9y ago
      There is huge demand for electrical power, but there is only huge desire for clean electrical power. I'm sure Bitcoin miners want to use clean power, but if it means they have tighter margins as a result, then non-clean will be what they stick with. (Bitcoin used only as placeholder here).
- bittcto 9y ago
  You're making the zero sum economic fallacy. More demand for solar panels finances more panels growing, increasing economies of scale reducing panel costs, and also, quite literally growing the total capacity of panels available in the world.

xutopia 9y ago

This is why there is a huge gold rush in Quebec. We have cheap electricity year long and cheap cooling 9 months of the year.

supbitcoin 9y ago
True, I have a friend who is building a mining operation of 112 MW in the North

martin1975 9y ago

In other words, proof-of-stake is the future. Legacy PoW coins will stick around, but they will not be dominant.

bmcusick 9y ago

Bitcoin is a great export product for Iceland. Their biggest disadvantage is being so remote from the rest of the world, so the ability to produce something locally that has zero shipping costs isn't one to be missed. It's effectively a way of turning local geothermal power into money, providing tax revenues to all sorts of services.

njarboe 9y ago

While it does sound impressive, as stated in the article, Iceland has only 340,000 people. And almost all heating is done with geothermally heated water further reducing residential electricity costs. Compared to the electricity of aluminum smelting business in Iceland, bitcoin very small (so far).