Crypto Mines are struggling to reduce carbon emissions.

Bitcoin has made a name for itself by promoting cheap electricity. Now Bitcoin diggers are trying to get to a green point.

Bitcoin companies aim to run their computers on renewable energy or to register for solar or wind-powered databases. The fall in prices for renewables and the rise in bitcoin still make a profit.

But much of Bitcoin’s mining is still based on fossil fuels, coal, cheap and dirty energy. “Crypto has a carbon-level problem,” said Paolo Natali, director of the Rocky Mountain Institute’s Climate Intelligence Program.

That problem led to the creation of the Crypto Climate Accord in April, a voluntary framework requiring cryptocurrency companies to reduce net carbon emissions from zero to zero by 2030, with some 180 companies registered, Mr Natalie said.

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Politics

Miners say they are thinking about the environment but have other incentives to reduce carbon emissions.

Lawmakers in New York State are considering a ban on fossil fuels to produce bitcoin, and miners have been asked to register their carbon footprint. The Securities and Exchange Commission is considering measures to require publicly traded companies to release weather information.

Crypto currencies, including Bitcoin, use a labor-intensive process to verify transactions. This requires a large amount of computer power, which requires a lot of electricity.

The Bitcoin New Minerals Institute in Northern New York is using the Niagara River hydroelectric power plant. The company is part of a group of miners trying to make the industry more environmentally and financially sustainable. Example: Exam Alex Alex Kuzoyan / WSJ

The lower the price of electricity, the higher the profit. The cheapest sources are sometimes very dirty, which causes some miners to restart previously discontinued coal plants. In areas with renewable energy resources, the combination of green energy with coal, natural gas or other sources can make landmines more important.

“If you mine cryptocurrency, you worry about electricity costs and you don’t have the luxury to take care of the climate,” said Alex de Vries, an economist who created the Bitcoin Energy Consumption Index.

Griffin Digital Mining joined the Crypto Climate Agreement in May and said it had achieved net zero carbon emissions. He launched a 21-megawatt hydroelectric facility and registered more than half of the power with a digital hosting company that receives renewable energy sources. The airline fills the gap by purchasing carbon offset credits in such a way that it can offset carbon emissions.

Some bitcoin miners are reviving their energy needs by reviving coal mines, such as New York State.


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Julie Jacobson / Associated Press

“We want to be the best pastors in the world,” said Rob Chang, CEO of Griffon.

About 76 percent of mining-certified cryptocurrencies combine green and fossil fuels, but less than 40% of mining and other cryptocurrencies come from renewable sources, according to a survey of 280 crypto companies. Center for Alternative Finance at the University of Cambridge.

Mr de Vries said renewable energy sources in crypto-mining could still use fossil fuels to generate more energy. Bitcoins miners in El Salvador use green energy from volcanic eruptions to power operations. Despite its abundant renewable resources, the Central American country has imported about 20% of its fuel for 2019, according to the World Trade Organization.

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“If you put green energy into bitcoin miners, you have to increase your imports from fossil fuels,” said Mr de Vris. “You are displacing the problem.”

China has increased cryptocurrency in the United States and Canada after banning transactions with Bitcoin and the like. The US and Canada accounted for 45% of global bitcoin transactions in August, up from 12 percent in January, according to the Cambridge Alternative Finance Center. Bitcoin-mining activity decreased by 20% during the period following the closure of mines in China.

Some of the world’s most important companies are now focusing on carbon emissions. Coinbase COIN Spokesperson for Digital Coin Exchange, which officially sells 2.97%

He said the company was currently focusing on environmental issues and would announce action on climate change in the coming weeks.

Write Shane Schifflet at Shane.Shifflett@wsj.com

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