It’s heating up in Texas as the Summer progresses, with the record for energy usage in the state being shattered twice last week. Last Friday, the state recorded 78,206 megawatts of expended power, breaking the previous record of 77,460 megawatts just a few days earlier on July 5, according to data from the Electric Reliability Council of Texas (ERCOT).
Accordingly, the Lone Star state’s host of Bitcoin mining companies have temporarily halted their machines on Monday, to avoid the threat of blackouts as first reported by Bloomberg.
This decision was made to ease the stress on the Texas power grid, which has been especially susceptible to the elements in recent years, most notably suffering power outages during a string of severe winter storms in February 2021.
Industries that are reliant on intensive energy usage weren’t the only ones asked to scale back, as ERCOT encouraged individual households to adjust their thermostats by “a degree or two,” and avoid “running major appliances... during afternoon peak hours.”
A crypto hub —
As noted in the Bloomberg report, some of these companies include Riot Blockchain, Argo Blockchain, and Core Scientific. Texas has become something of a bastion for Bitcoin miners since China began cracking down on crypto mining last year.
Over 1 percent of the state’s total grid capacity was being utilized by the existing collection of mining companies operating there, which accounts for “over 1,000 megawatts,” stated Lee Bratcher, president of the Texas Blockchain Council, in an email correspondence with Bloomberg.
Bratcher also pointed out that the suspension of industrial mining equipment allows for increased capacity for things like, you know, cooling one’s home during a record-shattering heatwave.
Still, the announcement from ERCOT was not necessarily the only driver for this pause in activity. Some Bitcoin mining companies have agreements in place to receive payments to curtail their operations, as pointed out by Fortune.
Given the ongoing crypto winter, miners have been forced to sell off their own supplies of Bitcoin in order to curb losses for the very resource they’re extracting. For every Bitcoin that is produced during a time of record-setting drops in the digital currency’s value, the opportunity cost only becomes higher.
Taking a payout to temporarily escape this cycle of deteriorating value makes both economic and practical sense.
