Crypto mining in Australia is perfect for soaking up excess rooftop solar and night-time wind generation which is causing problems for electricity generation firms.
While it is energy-intensive to mine Bitcoin, the operations can also help siphon off energy from renewable sources which may have otherwise gone to waste.
Bitcoin has become the hottest investment to make as firms such as Tesla build their treasury around it with a massive $1.5 billion investment.
US financial aggregator Square also holds a $230 million investment.
Paypal, Visa and Mastercard are also in the process of brokering an agreement to facilitate payments in Bitcoin.
All these have helped the currency quadruple in value over the past year, reaching a high of $USD 58,000 in February 2021.
Mainstream acceptance of Bitcoin has given it a status of wealth
The greatest difference between Bitcoin and other forms of cryptocurrency is that the former has become a store of value.
Bitcoin was originally designed to be a transactional currency.
Elon Musk recently said Bitcoin has become the future for hedging, the new gold and a backing tool for wealth.
This is why it is gaining stratospherically in value. People are investing in Bitcoin and holding onto it as a status of wealth.
Bitcoin can still be traded verifying transactions results in the minting of new Bitcoin, which the problem solver receives.
The concept is called ‘proof of work’.
Just 10 years ago crypto mining was a hobby for anyone with a bit of computer experience, a laptop and a decent Graphics Processing Unit.
It has become a lucrative activity on an industrial scale. Bitcoin’s creator Satoshi Nakamto designed the system so an algorithm is solved every 10 minutes.
The software scales the algorithm up and down, making it harder or easier depending on the number of computers trying to crack it.
The algorithm also allows for the processing power variable and dedicated mining computers are getting more and more powerful, consuming more electricity.
How can crypto mining help balance the Australian energy grid?
The drop in electricity prices has encouraged crypto mining companies such as Cosmos Capital to build a lab in rural Australia.
The lab is currently in talks with energy providers to take on the excess generation that is sitting idle.
Bitcoin mining is growing at a time when Australia’s energy grid is transitioning to renewable energy. This change has presented some challenges for generators. One such example is when plentiful rooftop solar drives demand down to deep troughs during the day.
However, there is usually a huge spike in demand in the evening when the sun stops shining and the wind dies down, creating what is known as the duck curve. In the late evening and through the night, when demand is at its lowest, the wind picks up and creates more excess generation.
When computers are switched off, they immediately free up power for use elsewhere.
Crypto mining can help stabilise the grid in two ways. The first is to soak up excess daytime solar generation.
They can do this by powering down machines in the early evening and switching them back on at night to draw excess generation from wind power.
The second way is when cryptomining companies sell contracted electricity back into the grid when there are supply squeezes. This also leads to massive profits for the cryptocurrency company.
One company in Texas recently did this and returned a 700-percent profit.
As we found out recently, cryptocurrency mining requires a lot of electricity to run. As such, if you’re planning to set up a crypto mining lab operation in Australia, it’s essential to have an energy plan that keeps electricity expenses reasonable. To do so, here are a few things you need to keep in mind:
- How does your current energy demand compare to your expected energy demand?
- Which state is your company operating from, and which network covers that location?
- How or from whom should you procure your energy supply from? You will need to decide on an electricity provider who can draw up a fitting energy contract structure and efficiency plan that meets your requirements and offers reasonable monthly rates.
- Which Demand Response product will best address the way you use electricity on your crypto mining venture? How can you obtain this?
- Which types of technology (for instance, apps) are available for monitoring and controlling your site’s electricity consumption?
Leading Edge Energy is committed to helping businesses in the cryptocurrency industry and beyond monitor and manage their electricity consumption. No need to pay unreasonably high electricity bills – just contact our Energy Experts and we’ll help you find the right energy efficiency solution that fits your budget and consumption. Call us at 1300-852-770 or fill out our form here today!