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Hochul administration decides to shut down gas-powered cryptocurrency factory

By on June 30, 2022 0

ALBANY, NY – Governor Kathy Hochul’s administration on Thursday denied a key permit for a gas-powered cryptocurrency mining operation in the Finger Lakes, saying the facility spews too much global-warming pollution to be permitted under state climate law.

The State Department of Environmental Conservation’s decision on the Greenidge Gas Plant is the latest step in New York to reduce pollution from cryptocurrency mining facilities that have begun to proliferate in the North of New York State for the growing industry.

“We are applying a new law to a new operation that has seen a significant increase in emissions — almost tripling emissions,” DEC Commissioner Basil Seggos told POLITICO in an interview Thursday. “The company itself was unable to demonstrate that it could comply with the law.”

Hochul faced political pressure to deny the permit, but delayed it until after Tuesday’s gubernatorial primary which she won convincingly. She is also being pressured to sign a measure to place a moratorium on any further new fossil fuel-powered cryptocurrency mining projects in New York.

The 106 MW gas plant at Greenidge hosts a large-scale Bitcoin mining facility, with approximately 17,000 miners. The plant faced aggressive opposition from many local residents, lawmakers and winemakers in the area.

Greenidge Generation Holdings Inc., the company that runs the plant which employs around 50 people, said it planned to appeal the decision and would continue to operate as usual while the process unfolds in a statement Thursday.

“We believe that there is no credible legal basis for denying this request because there is no real threat to the state’s Climate Leadership and Community Protection Act (CLCPA) from our license renewed,” the company said in a statement.

“This is a standard air permit renewal governing emissions levels for a facility operating in full compliance with its existing permit today. It is not, and cannot be turned into, a” “politically charged” cryptocurrency license.

Environmental advocates and other opponents of the project say increased emissions from cryptocurrency mining threaten the achievement of New York’s sweeping Climate Leadership and Community Protection Act. The measure calls for emissions to be cut 40% below 1990 levels by 2030 and 85% by 2050.

DEC agreed in a letter explaining the decision to deny renewal of the plant’s Title V emissions permit. The agency also said the company provided no justification for the reliability or other need for the project given that it would interfere with state climate goals, and that the goal of the plant had changed significantly since the original permit was issued in 2016 for the plant.

“Any increase in emissions at this stage makes it difficult for us to meet our targets which are very ambitious,” Seggos said. “As a slice of total emissions, this is just one operation, but we’re looking at the whole economy…and we need to start putting these strategies in place to reduce emissions as quickly as possible. “

Lawyers who had lobbied for the denial of the renewed permit welcomed the decision.

“Governor Hochul and the DEC have stood with science and the people, and sent a message to outside speculators: New York’s old fossil fuel power plants are not yours to reopen as Bitcoin mining cancers. gas guzzlers on our communities,” Yvonne said. Taylor, vice president of Seneca Lake Guardian in a statement.

Greenidge has 30 days to pursue an administrative appeal of the permit denial. If he does not appeal, the operations of the factory, which employs around fifty people, should cease.

The decision has significant implications for the state’s efforts to enforce climate law, and may also alarm manufacturers, hospitals, universities, power companies and other businesses seeking to renew their Title V permit. Seggos said the decision was closely tailored to the new cryptocurrency mining underway at the plant.

DEC previously rejected two aerial permits to refuel fossil fuel power plants, building new gas turbines. The Greenidge plant was not looking to build new power generation, but rather was looking to continue operating the existing turbine at higher levels than in previous years while keeping emissions within previously permitted limits.

The DEC decision letter notes that actual emissions have increased since 2016, when the original permit was issued, and 2020, when the climate law was passed. This increase is due to the fact that “Greenidge has significantly changed the main objective” of the factory. A renewal would allow the company to continue to increase greenhouse gas emissions “to benefit its own behind-the-meter operations,” the letter said.

The DEC rejected Greenidge’s arguments that the plant represents only a fraction of the state’s total emissions and that a permit expiring before 2030 cannot interfere with the state’s 2030 emissions goals. .

“Achieving statewide GHG emissions limits will require substantial action before 2030, including moving the energy sector away from its reliance on fossil fuels,” the letter said. “Even during the term of the permit, the continued operation of the facility to provide behind-the-meter power to its cryptocurrency mining operations would make it more difficult to achieve GHG emission limits at statewide.”

Crypto mining now uses around 45 megawatts of the 106 MW gas plant capacity. When operating, the plant also sells electricity to the grid.

Greenidge was built in the late 1930s as a coal-fired power station. It was decommissioned in 2011 and the new owners received state subsidies to convert to gas in 2017, when natural gas power was seen as a “bridge” rather than a dead end for the planet. They then turned to Bitcoin to boost their profits in 2020. The plant is owned by publicly traded company Greenidge Generation Holdings, which also has digital currency mining operations in South Carolina.

The DEC had again delayed a decision on a renewed permit in March, citing a high volume of comments and an offer from Greenidge. Greenidge has proposed to reduce its emissions by 40% from currently permitted levels by 2025 and to be a zero-emissions facility by 2035. That’s ahead of the United States Climate Act deadlines. ‘State.

But these proposals are not sufficient and the company has failed to justify the need for the project, the department found.

Greenidge said the department has not committed to this proposal.

“They chose to pass up the opportunity to materially improve the environment, choosing instead to impose on New York taxpayers the cost of financing a protracted administrative and legal battle that could easily have been avoided,” said the company in the press release.

Greenidge has increased the amount of pollution it releases into the air and water it sucks up from the lake and dumps at a higher temperature into a trout stream since it started cryptocurrency mining in 2020.

Greenidge expected its actual on-site carbon dioxide emissions in 2022 and beyond to be 520,386 metric tons per year, according to filings. Emissions in 2019 were 65,607 metric tons and less than 200,000 in the previous two years.

Environmental groups have also raised concerns about water quality and impacts on aquatic life. Like many shoreline combustion facilities, Greenidge draws in water to cool it and releases it at a high temperature.