‘You can see red flags when something might be environmentally risky’
Anna Kelles, Ph.D., New York Assemblymember (District 125)
SENECA LAKE, N.Y. – Running down the halls of the New York State Assembly, Anna Kelles knew she was in a race against time. The assemblymember was pushing a bill to pause bitcoin mining in the state due to climate concerns, and wanted to beat opponents to briefing her colleagues.
Kelles, an environmental scientist with decades of experience, was trying to build support for her legislation, which would put a two-year pause on new proof of work cryptocurrency mining in New York until a comprehensive study could be conducted of its potential environmental harm. She was skeptical of what she called the “funny money” and worried about how resurrecting once-shuttered fossil fuel power plants to generate electricity for crypto mining could worsen the climate crisis.
“They used the playbook of any industry that has faced regulation,” says Kelles, recalling how lobbyists opposed to the bill warned lawmakers of job losses and other dire economic consequences if it became law. “The rhetoric was really based on a lot of fear,” she says.
What Kelles had on her side were facts, not threats. In a series of meetings with her colleagues she laid out the concerns about how using fossil fuels to power bitcoin mining could be bad for water and air quality, the climate, and quality of life.
The pipe that feeds water into the plant can withdraw up to 139 million gallons a day from Seneca Lake to create steam power, potentially dragging in and killing fish.
Armed with statistics, Kelles was optimistic that if she could just beat the fear-mongering lobbyists to her colleagues’ office, the other lawmakers would side with her. “I knew if I could just get 45 minutes to speak to them first, I would have the truth on my side.”
Her efforts paid off: In November 2022 Gov. Kathy Hochul signed Kelles’ bill into law. The New York Department of Environmental Conservation, or DEC, is now working on the mandated two-year environmental impact review.
Clashing with the state’s climate law
Kelles’ bill was inspired not only by concerns over bitcoin mining’s potential pollution, but also questions about whether possible greenhouse gas emissions increases from fossil fuel power used for mining could violate the state’s landmark climate law.
New York’s Climate Leadership and Community Protection Act, or CLCPA, requires the state to reduce greenhouse gases 40 percent by 2030. Yvonne Taylor, vice president of Seneca Lake Guardian, a grassroots group committed to fighting projects that might harm the local environment, warned in May 2022 that bitcoin mining emissions might lead to a spike in greenhouse gas emissions that could hinder New York’s ability to meet its climate goal.
“In the Finger Lakes and across the state, outside speculators are invading our communities to destroy our natural resources, kneecap local businesses and keep us from meeting the crucial climate goals outlined by the CLCPA, just to make a few people very, very rich,” Taylor said at the time.
Taylor’s group is among those fighting a former coal-fired power plant in Dresden, N.Y. that Greenidge Generation Holdings has been using since 2020 to power its commercial bitcoin mining operations. Greenidge Generation is part of Atlas Holdings, which bought the plant in 2014 and brought it back online in 2017. Instead of coal, the plant shifted to natural gas – another dirty fossil fuel that emits greenhouse gas emissions.
The plant’s Title V air permit expired in September 2021, and its application for a new air permit was denied by the DEC in June 2022 because of what the department said was its inconsistency with the state’s climate law. But the plant continues to operate while it appeals the denial of the air permit.
Former coal plant turned Greenidge crypto mine in Dresden, N.Y.
Photo credit: Associated Press
In March 2021, the company had applied to the DEC seeking to renew the permit. More than 4,000 public comments weighed in on the request, including critical comments from people and organizations concerned about the power plant’s electricity use, carbon emissions, and water pollution problems.
Many opponents warned that Greenidge would spur a drastic increase in greenhouse gas emissions, at odds with the New York climate law.
The DEC agreed, and in June 2022 it denied the permit application, rejecting Greenidge’s claim that the plant did not violate the climate law. “Greenidge has not provided any additional information to the Department regarding a potential justification for the Facility,” the DEC wrote in its permit denial.
Water pollution problems
The more power Greenidge’s proof of work bitcoin mining requires, the more water it needs to generate that electricity. It’s an alarming prospect for some advocates near Seneca Lake, an area defined by its pristine body of water.
Greenidge crypto mine overlooks picturesque Seneca Lake
Photo credit: Associated Press
The pipe that feeds water into the plant can withdraw up to 139 million gallons a day from Seneca Lake to create steam power, potentially dragging in and killing fish. “It’s like a giant fish blender,” Taylor recently told EWG.
Greenidge took steps to reduce the pipe’s impact on aquatic life, starting work in 2017 on installing wedge wire screens to protect fish from the water intake system. The company announced in January 2023 that its work is complete and the screens are operating. But this only prevents the fish from being “blended” not boiled.
At its peak, Greenidge can also discharge into the lake as much as 134 million gallons a day at temperatures up to 108 degrees. Abi Buddington, who lives near the plant, told a January 2023 Sierra Club webinar that the renowned Seneca Lake trout can be stressed at just 70 degrees. She has kayaked near the plant and found the water “unnaturally warm.”
Warmer water can also contribute to algae blooms, which may be toxic to humans and are known to kill pet dogs every year. Algae blooms in the lake can upend the daily routine of residents who depend on the water for recreation or their livelihood.
“A lot of people get their water directly from the lake, and if there is a harmful outbreak, you don’t want to bathe or cook or even flush your toilets with it,” Taylor told EWG.
The dangers of dredging
Legal fights over Greenidge continue, including a recently filed lawsuit claiming the power plant’s discharges into the lake violate the federal Clean Water Act. The lawsuit claims the facility discharges magnesium, fluoride, arsenic, barium, boron, iron, manganese, and aluminum – all pollutants and all, it claims, in violation of the law.
Taylor acknowledges to EWG that battles over proof of work crypto mines take place on a town-by-town basis but also says it shouldn’t be this way. “We need federal regulations.”
In the absence of federal rules targeting the environmental impacts of bitcoin mining, advocates are waiting on the DEC’s review, as required by Kelles’ law. In the meantime, the battle over Greenidge continues.