Two Bitcoin mining giants compete for cheap electricity in the small town of Texas.
Bitdeer, a mining company spun off from Chinese giant Bitmain, and Riot Blockchain, one of the largest publicly traded Bitcoin mining companies in the United States, operate data centers housed in a former aluminum smelter in the Texas town of Rockdale.
The city’s aluminum smelting plant was previously the largest in the world, until the company that ran it, Alcoa, began operations in 2008. According to Lee Bratcher, chairman of the Texas Blockchain Council, the capacity The energy of the installation has been wasted since the departure of Alcoa until the miners settle in.
Although Rockdale comprises a small, rural town of just 5,600 residents, it has all the advantages that miners seek on an industrial scale – crypto-savvy politicians, large plots of land housing abandoned industrial infrastructure for reuse, and cheap electricity prices thanks to Texas’ deregulated market.
Rockdale Mayor John King describes the relationship between the local grid operator, the Electric Reliability Council of Texas (ERCOT) and the miners as mutually beneficial. He pointed out that miners regularly consume electricity that would otherwise be wasted, and that they can also shut down their operations instantly if electricity is needed elsewhere. He added:
“The miners agree to buy a certain amount of electricity and what they do is sell it on the market. [value] and make a profit. They have a contract for two or three cents … and they can sell it for $ 9 a kilowatt hour.
As Cointelegraph reported on October 7, Riot has more than tripled its Bitcoin production this year.
The company now estimates that the facility produces over 500 BTC per month from its Rockdale facility. At current prices, coins mined are equivalent to $ 30 million per month. Riot says the site hosts 100,000 mining rigs.
Related: Crypto Cowboys: Texas counties welcome Bitcoin miners with open arms
Texas lawmakers are pushing for a further expansion of the state’s Bitcoin mining embrace, with Senator Ted Cruz describing mining as a way to capture natural gas the state is currently burning.
Speaking at the Texas Blockchain summit on October 10, Cruz argued that natural gas is currently being burned in West Texas because “there is no transmission equipment to bring this natural gas to where it could be used as natural gas would normally be used ”.
“Use this power to mine Bitcoin. Part of the beauty of that is that by the time you do that, you are helping the environment tremendously, because rather than flaring natural gas, you are putting it to good use, ”he added.