In many parts of the world, access to electricity is a luxury that we often take for granted. Sub-Saharan Africa (SSA), for example, faces serious electrical deficitmore than 600 million people without electrical power. This deficit leads to economic stagnation, reduced food production, poverty, and even civil unrest. The correlation between access to electricity and economic growth is undeniable, and regions with less than 80% electrification rates they systematically suffer a reduction in GDP per capita. The challenge lies in expanding electrical infrastructure to these underserved areas, which is capital-intensive and often financially unfeasible for governments with limited resources. This is where bitcoin mining is a potential solution that can offer a path to electrifying regions that have long been without access to electricity.
bitcoin mining has long been the subject of much controversy, with critics often focusing on its perceived environmental impact. However, below the technology/bitcoin-miners-environment-crypto.html”>sensational headlines and bitcoin-mining-electricity-pollution.html”>mainstream media narratives, lies a story of potential humanitarian benefits and energy innovation. By harnessing stagnant energy in remote locations, bitcoin mining can provide a source of income for new power plants to support the construction of electrical grids.
Despite the current smear campaign against bitcoin mining, knowledge of the importance of harnessing stored energy for bitcoin mining is slowly gaining ground. In fact, this is the story that is beautifully captured in the newly released and prize documentary film, Stranded: A short of dirty coins by Alana Mediavialla Diazwhich shows how bitcoin miners in places like SSA ingeniously repurpose stranded energy, bringing both bitcoin and forgotten energy infrastructures to life.
In this article, we will explore the overlooked positive aspects of bitcoin mining, compare its energy consumption to other industries, and make the case for how bitcoin mining could potentially incentivize the discovery of new energy sources and the construction of new energy infrastructure.
What is stranded energy anyway?
bitcoin-c9a9a43e4a04″>Stranded energy It refers to energy sources that exist in a place but are not used or harnessed effectively for productive purposes. It is essentially energy that is isolated or “stranded” in a given location due to various reasons, such as a lack of infrastructure to transport it or a mismatch between the location of energy production and demand.
For example, when new electricity grids are developed, especially in remote areas, the energy infrastructure may be ready before demand catches up to it. Which means that, until consumers are connected to the grid, the energy generated is more than is immediately needed, making him “stranded” and is ultimately wasted until more users connect. This is a big problem that bitcoin mining can help solve, and this particular area is one of the main benefits of mining that Stranded explored in great detail.
In an interview, Alana highlighted how bitcoin mining, by monetizing excess energy in regions that lack traditional demand, acts as a financial catalyst to build vital network infrastructure, thereby changing lives and challenging our perceptions about social impact. of energy. She elaborated on this saying: “The concept of how a network grows through demand was never something I thought about. In the film I wanted to capture that it is a great privilege to have access to electricity and that mining is able to finance new grid infrastructure in places that have never had it before.”
Take Ethiopia as an example. have the potential to generate More than 60,000 megawatts (MW) of electricity come from “renewable” sources, but it currently only has 4,500 MW of installed capacity. 90% of your electricity It is generated from hydroelectric energy, with geothermal, solar and wind being the difference. However, the country still suffers from a serious energy shortage: only 44% of its 110 million inhabitants have access to electricity. With projects such as the Grand Ethiopian Renaissance Dam (GERD) under construction, which is expected to generate an additional 5,150 MW, the government hopes to have a total of 17,000 MW of installed capacity in the next 10 years. The introduction of bitcoin mining has the potential to finance these electrical infrastructure projects.
Dispelling misconceptions about bitcoin mining
One of the most common misconceptions surrounding bitcoin mining is the notion that it consumes an exorbitant amount of energy, surpassing the energy consumption of entire countries. Critics often bitcoin-mining-track-consume-worlds-energy-2020-744036″>point out the reports suggesting that bitcoin mining consumes more electricity than many nations, including Ireland, Nigeria and Uruguay. He bitcoin-energy-consumption”>bitcoin Energy Consumption Index According to cryptocurrency platform Digiconomist, it estimates annual energy use of 33 terawatts, on par with countries like Denmark.
However, it is important to analyze this criticism and place it in the broader context of energy consumption. While it is true that the energy use of the bitcoin network seems significant, it is essential to remember that energy consumption itself is not inherently bad. This criticism tends to assume that energy is a finite resource and that allocating it to bitcoin mining deprives other industries or individuals of this valuable commodity.
In reality, energy is a vital and expandable resource, and the notion that one use is more or less wasteful than another is subjective. All users, including bitcoin miners, incur a cost and pay the full market rate for the electricity they consume. Singling out bitcoin mining for its energy consumption and overlooking other industries is a fallacy. As Alana also pointed out, “People consider what the media commonly repeats about bitcoin to be common misconceptions. No one ever thinks about the energy consumption of the industries they interact with every day. This is not a common figure that people know about, but when it comes to bitcoin, it sure is dirty because of all that energy consumption!
Comparing bitcoin to other energy-intensive industries
To put things into perspective, let's compare bitcoin mining to other energy-intensive sectors that often escape similar scrutiny:
I don't know about you, but I can't remember the last time I heard complaints in the media about the high energy consumption of the pulp and paper industry. To counter the myths surrounding “the dangers” of bitcoin mining and its energy use, a nuanced understanding of energy consumption is required. While it is crucial to examine the environmental impact of any industry, criticizing bitcoin mining and overlooking other energy-intensive sectors is a flawed approach.
What does the future hold?
Unlike any previous technology, bitcoin mining incentivizes the exploration of profitable ways to harness energy, regardless of geographic limitations or conventional energy restrictions. This financial boost could trigger an energy revolution on a scale not seen since the Industrial Revolution, potentially propelling humanity to be a type I civilization. An opinion that is also shared by Alana, who when asked about her next film project said: “The next one is about what it will take us to reach a type 1 civilization using Puerto Rico as our underdog model that is undergoing a major change in infrastructure. “It is a crucial moment in the island's history and can serve as an example for failing networks around the world.”
As economic incentives bitcoin-mining-and-the-case-for-more”>boost bitcoin mining To saturate the energy sector, a convergence is occurring. Energy producers are monetizing surplus and stagnant energy through bitcoin mining, while miners are vertically integrating to improve competitiveness. In the foreseeable future, the most efficient miners could become energy producers themselves, potentially reversing the traditional power grid model.
This is a guest post by Kudzai Kutukwa. The opinions expressed are entirely their own and do not necessarily reflect those of btc Inc or bitcoin Magazine.
