Why Northwest officials are only now deciding how to regulate crypto mining

More than a dozen cryptocurrency mining operations call Grant County, Washington, home.

In a county of just over 100,000 residents, sitting directly below the Grand Coulee Dam, 13 crypto mining operations — think warehouses stacked with networked computers continuously working on complex math equations to earn bitcoin — might seem like a lot. But the combined 27 megawatts of electricity those miners use today comprise only a fraction of the requests the Grant County Public Utility District has fielded since 2017, when bitcoin surged in value to nearly $20,000.

“We were getting inquiries that would have tripled our load for the county” back in 2018, said Christine Pratt, public information officer for the utility. “The actions we’ve taken have prepared us to deal with that type of customer fairly.”

The swell of crypto mining interest in the region was driven by some of the cheapest hydropower in the U.S. produced by the Grand Coulee and other dams. So the utilities in central Washington used tiered power rate increases to manage the high electricity usage that is characteristic of the industry.

Fee schedules have also wound up being one of the few ways that any public authority in Washington has sought to regulate the crypto mining industry.

Several years of bitcoin’s boom-and-bust cycles later, environmental regulations around crypto mining have remained relatively sparse in Washington and the rest of the Northwest.

Even at state agencies tasked with environmental protections beyond emissions, such as water quality or e-waste disposal, spokespeople echoed a common refrain that they have little or no specific insight into the impacts of bitcoin mining.

Slowly, that’s beginning to change.

The targets for Oregon’s and Washington’s ambitious clean air laws, which seek to phase out nonrenewable energy sources from the states’ power grid in the next couple of decades, are growing closer. In response, lobbyists and policymakers have begun to focus on ensuring crypto mining’s high electricity use doesn’t wind up contributing to fossil fuel emissions after the deadlines pass.

In Oregon, House Bill 2816 seeks to extend emissions controls to the high-load customers of consumer-owned utilities that are the providers for crypto mining operations and data centers, closing what climate activists consider an important loophole. Existing laws only apply to investor-owned utilities, such as PacifiCorp and Portland General Electric, and electricity service suppliers.

It really just made sense as a next step on this path toward 100% clean energy and making sure we’re meeting our target goals.

– Oregon Rep. Pam Marsh, D-Ashland, one of the co-sponsors of House Bill 2816

“It really just made sense as a next step on this path toward 100% clean energy and making sure we’re meeting our target goals,” said Oregon Rep. Pam Marsh, D-Southern Jackson County, one of the co-sponsors of HB 2816.

In Washington, House Bill 1416 would apply clean energy standards to similar customers of municipal and public utilities, which are excluded from current law. They serve the majority of crypto mining operations, which are primarily located in central and eastern Washington.

Glenn Blackmon, energy policy manager for the Washington Office of Energy, described the bill as one piece of a larger, ongoing conversation that the state needs about how to prioritize resources to meet its climate goals.

“We are also trying to transform other parts of our economy from fossil fuels to clean electricity,” Blackmon said. “(Crypto mining) certainly adds to the requirements that are already very large for us to build out our electric supply to meet our energy goals.”