Iceland is facing an “exponential” rise in Bitcoin mining that is gobbling up power resources, a spokesman for Icelandic energy firm HS Orka has said.
This year, electricity use at Bitcoin mining data centers is likely to exceed that of all Iceland’s homes, according to Johann Snorri Sigurbergsson.
He said many potential customers were keen to get in on the act.
“If all these projects are realized, we won’t have enough energy for it,” he told the BBC.
The Associated Press first reported Mr Sigurbergsson’s calculations.
Iceland has a small population of around 340,000 people.
But in recent years, it has seen a marked increase in new data centers, often built by firms wishing to tout green credentials. Nearly 100% of the energy in Iceland comes from renewable sources.
Bitcoin mining refers to computer work connected to the global Bitcoin network.
These computers solve complex mathematical problems – a process that, in turn, validates transactions between users of the crypto-currency.
The computers that do this validation work receive small Bitcoin rewards for their trouble, making it a lucrative exercise, especially when done at a large scale.
‘Exponential growth’
“What we’re seeing now is… you can almost call it exponential growth, I think, in the [energy] consumption of data centers,” said Mr Sigurbergsson.
He added that he expects Bitcoin mining operations will use around 840 gigawatt hours of electricity to supply data center computers and cooling systems, for example.
He estimated that the county’s homes, in contrast, use around 700 gigawatt hours every year.
“I don’t see it stopping quite yet,” added Mr Sigurbergsson, referring to data centre projects.
The crypto-currency mining industry in Iceland was recently boosted thanks to The Moonlite Project’s launch. Various cryptocurrencies, including Bitcoin, will be mined in this large data center.
It is set to open later this year and will have an initial capacity of 15 megawatts, though this is expected to increase in the future.
Some have questioned how beneficial the rise of crypto-currency mining will be to Iceland.
Smari McCarthy, a member of the Icelandic parliament for the Pirate Party, tweeted: “Cryptocurrency mining requires almost no staff, very little in capital investments, and mostly leaves no taxes either.
“The value to Iceland… is virtually zero.”
He also clarified previous reports that quoted him as keen to tax Bitcoin mining firms.
It has previously been reported that the electricity demand of the world’s total combined Bitcoin mining operations may now exceed the energy use of the Republic of Ireland. However, this calculation may not be entirely accurate.
But as crypto-currencies rise in popularity, mining operations continue to use more and more resources – a recent analysis of European energy use in 2017 by campaign group Sandbag. to additional power demand in the technology sector.
