Texas sees potential gains from Bitcoin mining for the energy sector

Mining facilities do not require a continuous electricity supply, so their long‑term siting in Texas could be advantageous for the energy sector. This is reported by the Texas Comptroller’s Office.

In a published note, Joshua Rhodes of the Webber Energy Group explained that Texas-based miners are attracted by the low cost of electricity and the rapid process of connecting equipment to the grid.

He noted that, despite its energy intensity, cryptocurrency mining offers a potentially advantageous link between electricity demand and its generation.

Miners can participate in demand-response programs, which means they can be cut off from the grid during peak demand.

“Supply and demand work in tandem, so if miners stop using electricity, this will help meet rising demand on the grid and improve its stability,” Rhodes said.

Moreover, ramping up cryptocurrency mining could spur the development of additional energy infrastructure. Mining facilities are often located near wind and solar plants that offer lower tariffs. This practice is common, for example, in the remote parts of West Texas.

“If cryptocurrency mining increases in this region, electricity prices could rise, which, in turn, would accelerate the construction of new plants,” the expert said.

The main difference between mining and large industrial operations, according to Rhodes, is that “the capacity for it can appear quickly and disappear just as quickly, depending on the price of Bitcoin.”

The researcher added that cryptocurrency mining could also potentially spur renewable generation provided long-term contracts with electricity suppliers are secured.

“If miners are willing to show flexibility, for example by participating in a demand-response program, they could become a valuable asset for the grid,” he concluded.

Separately, Texas authorities are debating repurposing excess gas for cryptocurrency mining to cut emissions.

Last week, an Arcane Research analyst forecast a tenfold growth in the Bitcoin network’s annual energy consumption by 2040, provided the price of the first cryptocurrency reaches $2 million.

Earlier, a Capriole Investments analyst stated the capitulation phase of Bitcoin miners has ended.

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