With Texas having natural gas, literally, to burn, and the Bitcoin mining industry a new wealth frontier like oil was for the state, Sen. Ted Cruz, R-Texas, wants Texas to capitalize.
Cruz is pitching the expansion of power-draining Bitcoin mining in the state to run on the state's energy surpluses when they exist as being a way to mitigate energy shortages when they arise, The Dallas Morning News reported.
"Because of the ability of Bitcoin mining to turn on or off instantaneously, if you have a moment where there's a power shortage in a power crisis, whether it is a freeze or some other natural disaster where power generation capacity goes down," Cruz told the Texas Blockchain Summit in Austin earlier this month, "they become excess reserves that can strengthen the grid's resilience by providing a significant capacity of additional power to be available for critical services if and when it's needed."
Bitcoin mining requires running a complex system of computers and has been reported to require more energy than many countries. Instead of being a pull on demands for more power, Bitcoin can be used to help balance the surpluses, according to Cruz.
"In five years, I expect to see a dramatically different terrain, with Bitcoin mining playing a significant role strengthening and hardening the resiliency of the grid," Cruz added, according to the News.
Texas has natural gas to burn and could give the Bitcoin mining an opportunity to capitalize.
"Fifty percent of the natural gas in this country that is flared is being flared in the Permian [Basin] right now in West Texas," Cruz said. "I think that is an enormous opportunity for Bitcoin, because that's right now energy that's just being wasted.
"Some of the really exciting endeavors that people are looking at is, 'Can we capture that gas instead of burn it, use it to put in a generator right there on site, use that power to mine Bitcoin?'"
A Rice University environmental engineering professor remains skeptical.
"There is merit to the idea that more flexible demand makes it easier to balance the ups and downs of supply when wind and solar vary, or when coal and gas and nuclear plants fail," Daniel Cohan told the News. "But just adding brand new demand to the grid isn't helpful, or doesn't fix the shortfalls.
"We should be capturing more of the natural gas, rather than letting it leak or be flared, but that’s independent of whether we have Bitcoin miners. The capture of natural gas can be used for anything, there's no shortage of customers looking for natural gas to use."
Cruz has become a Bitcoin backer, proposing to strike regulation on the industry that was included in the $1.2 trillion infrastructure package.
"There is a new and exciting industry in the United States of cryptocurrency, whether Bitcoin or otherwise, that are generating jobs, entrepreneurs who are creating new values," Cruz said on the Senate floor.
"It is dynamic, and this infrastructure bill," he added, "has one little portion in there designed to obliterate cryptocurrency."
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