According to a recent report published by the Cambridge Center for Alternative Finance (CCAF), Bitcoin mining accounts for 0.10% of global greenhouse gas (GHG) emissions, or 48.35 million tons of carbon dioxide per year. What’s more, the CCAF report notes that “Bitcoin’s environmental footprint is becoming more complex and complicated” and due to complex issues “highlights the importance of independent data.”
Cambridge Center for the Study of Alternative Finance: ‘Bitcoin Network Produces 48.35 Million Tonnes of CO2 a Year’
On Tuesday, the Cambridge Center for Alternative Finance (CCAF) published a new report, “A Deeper Dive into Bitcoin’s Environmental Impact,” written by CCAF’s project leader. Alexander Nummuller. The report highlights that bitcoin’s growing popularity has focused attention on “environmental issues related to bitcoin production.”
A CCAF study says the Bitcoin network produces 48.35 million tons of carbon dioxide per year. The measure is equivalent to approximately 0.10% of global greenhouse gas emissions and is 14.1% lower than Nummüller’s projected GHG emissions in 2021.
Neumüller’s research further details that 37.6 percent of the energy used by bitcoin (BTC) miners comes from sustainable forms of energy. CCAF’s “best estimate” of 0.10% of global greenhouse gas emissions is equivalent to the amount of energy used in Nepal or the Central African Republic.
Bitcoin mining power represents a touch less than half of the 100.4 million tons of carbon dioxide gold mining uses annually. Neumüller believes that GHG emissions in 2022 will be lower than in 2021 because of “significant reductions in mining profitability”.
CCAF notes that the decline may be due to the shift from inefficient mining to more efficient next-generation machines. Neumüller said CCAF’s estimate was “verified by empirical evidence from Bitcoin miners.”
Miners face pressure from three angles: falling BTC price, increasing hashrate, and operational costs. Rev per hash is near ’20 lows, and energy costs are rising, despite ASICs being more efficient. Can separate the wheat from the chaff this year, strengthening in the future? pic.twitter.com/WRqbTD8raG
— Alexander Neumueller (@alexneumueller) June 16, 2022
In addition to swapping out old hardware for newer and more efficient bitcoin miners, the CCAF said that as China’s hashrate decreased, the cryptocurrency’s “electricity mix became more diverse.” According to Nummuller and CCAF data, sustainable energy use has decreased recently.
As of 2021, data shows that electricity mix fluctuations are now “significantly less” variable. As it is not yet possible to comment on how the emissions have changed from 2021 to 2022, as only January data is available, Bitcoin’s average emissions in 2020 (491.24 gCO2e/kWh) were compared to 2021 (531.81 gCO2e/kWh), indicating that the sustainability of the electricity mix has deteriorated,” explained Neumüller.
The CCAF report notes that the bitcoin mining industry is constantly changing and that CCAF’s research and tools will continue to evolve. With real-world data, researchers can look at the situation in a “big picture.”
CCAF’s project leader concludes the study, “exciting concepts and developments are already appearing in bitcoin mining.” These include concepts such as flare gas reduction, waste heat recovery and applied demand response applications.
“Time will tell whether these are novel ideas that have failed to deliver on their promise, or whether they will become an integral part of the Bitcoin mining industry in the future,” Neumüller’s report concludes.
What do you think of the latest bitcoin mining report published by the Cambridge Center for Alternative Finance? Let us know what you think about this in the comments section below.
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