© Courtesy of KFDX Wichita FallsAUSTIN (KXAN) – Everything is booming in Texas, including cryptocurrency mining operations. Texas is currently home to the largest cryptocurrency mining operation in North America, and according to researchers, all operations in the state account for approximately 15% of the world's mining.
Texas-sized energy consumption is associated with these mining operations. To "mine" cryptocurrencies, computers must use computational algorithms to validate transactions. Computers that solve the algorithm receive a "reward" in the form of a cryptocurrency such as bitcoin, according to the Texas Comptroller.
According to the Texas Comptroller, the more calculations a computer can solve, the more likely it is to win a prize.
“In short, bitcoin mining is an energy-intensive process. Therefore, the level of these computer requirements has reached a level where it can compete with the cost of electricity in the city," said Le Gee professor of electrical and computer engineering at Texas A&M University. .
The Texas Comptroller estimates that by 2023, the state's cryptocurrency mining operations could need as much energy as that of Houston, the fourth largest city in the United States.
Despite the amount of energy required for these operations, Texas political leaders are promoting the state as home to mining companies, reports the Texas Tribune. Some of the rural areas where the objects have been moved have welcomed them and have benefited financially from the operation.
What risks do these mining companies pose to the Texas power grid?
Professor Le Gee is studying the impact these mining operations have on the Texas power grid.
His research focuses on examining the impact of mining operations in three areas: grid reliability, carbon footprint and wholesale energy market prices.
“Their impact really depends on how you shape them,” Xie said. "If they were modeled as [permanent] demand, it would have a significant impact on network reliability," as they always have to maintain the network and load it.
Conversely, if the facilities are "flexible," meaning they can be shut down during times of grid instability, they could actually be used to deliver more power to the Texas grid, Xie said.
The Xie group's findings were published in the March issue of the Institute of Electrical and Electronics Engineers' Institute for Energy Markets, Policy, and Regulation and the June issue of Advances in Applied Energy.
“We are pleased to report that the models and data we use can help decision makers, not just in Texas, but across the country, monitor and understand their work under stressful conditions,” he said.
Cryptocurrencies and cryptocurrencies are still relatively new industries. Bitcoin, the most popular cryptocurrency, has only been around since 2009.
“Any questions outside the specified range should always be studied and combined with careful analysis,” Xie said. “That is why we are doing research to understand [cryptocurrencies] properties so we can provide better decision support to policy makers.”
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