The blackout in Spain is an opportunity to remind that the Bitcoin industry could certainly have helped prevent the disaster.

The complete blackout in Spain last week was a disaster that could have been avoided, and the Bitcoin industry could certainly have helped prevent it.

Bitcoin, how many GW?

As a sign, the University of Cambridge has just published a report in which it describes the Bitcoin industry as an “key contributor to network resilience” by offering network managers a “demand-based strategy”.

The results are based on a survey of 49 bitcoin miners representing 48% of the total computing power (hashrate). It should be noted that North American miners represent 80% of the sample, twice their actual global share.

Verdict: the annual global electricity consumption of the Bitcoin network is around 140 TWh and generates 40 MtCO2e of greenhouse gas emissions. This corresponds to an electrical power of 7.3 GW, comparable to that of the Czech Republic.

But surprise, it turns out that sustainable energy sources are actually the majority (52.4%). Hydroelectric power comes first (23.4%), followed by wind (15.4%), nuclear (9.8%), and solar energy (3.2%). Fossil fuels are mainly natural gas (38%) and coal (9%).

All in all, the Bitcoin industry consumes 0.54% of the world’s electricity production. Another useful piece of information: miners report paying an average of 0.045 $ per kWh. This bargain price suggests that it is mostly electricity that would otherwise be wasted, i.e., produced by renewables.

Those are the raw numbers. As highlighted in the introduction, the report also highlights the advantage the bitcoin industry represents for balancing electrical grids. The Spanish government would do well to read it…

Indeed, bitcoin miners offer more resilience against sudden outages because they can disconnect from the network instantly.

A luxury fuse

Balancing the electrical grid via demand is becoming increasingly essential to accommodate the growth of intermittent energies at lower cost and the headache they represent for network managers.

Historically, the grid frequency was maintained at 50 Hz by increasing or reducing the output of “peaking” power plants. These power plants are designed to start and stop quickly during demand spikes or unexpected outages. These typically include dams and gas plants.

However, in Spain, gas represented only 3% of electricity production at the time of the blackout. It was 73% for wind and solar energy, which have priority. Unfortunately, it seems that the priority given to renewables is largely responsible for the blackout:

And this is where bitcoin miners come into play as a demand-side adjustment variable. They offer load shedding solutions to network operators to balance demand and electricity production in real-time. No other industry can react as quickly.

The report also highlights that 57% of miners shut down on demand in 2023, returning a total of 888 GWh to the grid. This electrical symbiosis works so well that the Texas network operator (ERCOT) recently canceled the construction of several gas plants due to the 3 GW that miners can supply to the grid at any time.

Cherry on the cake, miners represent a significant financial boon for energy companies desperately needing funds to finance the energy transition.

Bitcoin vs Methane

The heat produced by the bitcoin industry can also be recycled. District heating, greenhouse farming, heating public pools, etc. There is plenty of potential since heat production generates 40% of global CO2 emissions.

Many projects are underway, particularly in Scandinavian countries:

The great advantage miners have is that they can set up almost anywhere. A Starlink satellite connection is enough to connect to the network.

This agility allows them to take advantage of gas when it is a byproduct of oil extraction. This is a gas that would otherwise be flared or worse, released into the atmosphere because it cannot be transported to civilization.

This methane (CH4) is burned into CO2 to reduce the greenhouse effect. CO2 is indeed 80 times less impactful than methane over a 20-year period. However, the combustion rate is often closer to 90% than 100%, for various reasons such as wind.

The alternative is to convert the gas into electricity to power bitcoin mining machines. Combustion then approaches 99.9%. Systematically deploying BTC miners would help combat global warming since 140 billion cubic meters of natural gas are flared each year (357 MtCO2e).

According to the report, 3.3% of the electricity consumed by miners comes from this type of gas. In other words, the share of renewable energy consumed by the Bitcoin network is not 52.4%, but rather 55.7%.

What exactly do BTC miners do?

If you’re still here, it means the topic interests you particularly. Catch-up course:

It is helpful to clearly distinguish the Bitcoin network into two parts: on one side transactions, and on the