OK, coin mining.
Set up grossly energy inefficient mine. So, kit is hugely cheap, poss even free.
Of course, you can’t run it and make a profit because energy costs. Except.
You can get paid (I think?) to not use energy when demand is high relative to supply. So, collect that subsidy by not running it at that time.
Also, sometimes ‘leccie wholesale price is negative. Wind overperforming etc. So, only run it then, when your ‘leccie meter is running backwards.
Yes, of course it’s absurd. But is the ‘leccie market absurd enough yet to make it work?
“Wind overperforming”
Use it to make Green Hydrogen eh?
The perverse incentivisation for dumping leccy is exceeding rare.
I’ll just stick with lobbying for rooftop hydropower turbines fitted to all drainpipes.
I think you could make this work in the Vaterland. The question is how big a customer you need to be at already eyewatering prices to benefit from the occasional “pay to shut down”. That system is also probably massively corrupt. The levels of corruption here, deeper and stronger the further up you go, well hidden by the political-media complex, would make a one-bit central African dictator call on his Priest for forgiveness. And bitcoin mining might not get past the first level of corruption – political correctness.
Domestic suppliers are now quoting typically 40 to 50 cents a kWh for new contracts. Mine fixed for 2 years, at 26 cents. I will enjoy while it lasts.
Well, yes. But only (a la BiFR) if you’re at a scale to enter the wholesale market directly. There’s a form of this already happened tho’ – miners shifted to cheap leccy (from coal) in China, Kazakh and (I think, Brazil). China’s already shutting them down.
Without the scale, it’s probably easier to use storage – get some generators and stock up on diesel when it’s relatively cheap, and make the switch as and when.
But I don’t think it’ll work – inefficient kit implies older, slower – so the time to mine increases, regardless of the energy price.
Buying the latest kit latest is expensive but “should” pay for itself by using less electricity for a given number of calculations (which is why it’s expensive), but if your electricity prices are high you will never cover the costs of electricity you use.
Some of the more profitable bitcoin miners have owed their success to stealing the electricity they use along with inefficient second hand kit that had become worthless to its original owner.
Intel is now working on some super super efficient mining chips. It will be interesting to see if they use them themselves or sell them. The old adage of the people selling shovels being the ones who got rich in a gold rush doesn’t apply to Bitcoin. With Bitcoin you strike gold anywhere that electricity is cheap.
Do what most of the miners are doing.
Steal the electricity.
Yes. In countries with subsidised power like Iran bitcoin mining is licensed and depracated.
In China bitcoin mining was used as a swing consumer for hydro when it rained a lot. The miners followed the seasonal rain.
In the USA bitcoin mining is used both as an anchor tenant e.g. For geothermal and as a swing consumer.
The magic of markets produces many variations on the theme.
Surely, isn’t Tim’s point that at times electricity can be a negative cost. Because you can get paid for not using it. Coin mining is just a way of using electric. You could get the same result by installing a load of electric fires in an industrial freezing plant.
“Green” is stupid enough for anything!
A decent mining rig eats about 5kWh, 10kWh for a really serious rig. Enough to rate an industrial contract ( and fusebox….) , but not nearly enough for wholesale prices.
And really.. If I were able to get my grubby mitts on kit like that I wouldn’t be mining bitcoin with it… I’d rent out the processing power to various shades of Boffinry for model simulation and the like.
May not be as big an “earner” as Virtualcoin speculation, but slow and steady gets the cart home, and all.