Storage Developer Urges Texas PUC To Study "Reliability Concerns" From Cryptocurrency Mining, Crowding Out Of "Physical" Solutions
April 15, 2021 Email This Story Copyright 2010-21 EnergyChoiceMatters.com
Reporting by Paul Ring • email@example.com
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HGP Storage (HGP) filed a pleading at the Texas PUC requesting that the PUC, "direct the Electric Reliability Council of Texas (ERCOT) to study the
potential reliability concerns driven by large datacenters that mine cryptocurrencies."
HGP Storage alleged, "There are
companies that look to benefit from the pricing of ancillary services in ERCOT to increase load
while providing little to no direct benefit to Texas. A company announced this week that it is
planning a facility with over a Gigawatt of load, expressly with the goal of benefiting from 'real-time'
price volatility and 'ancillary power services revenue'"
Quoting from a news release from Riot Blockchain, Inc. in which Riot announced that it has signed a definitive agreement to acquire Whinstone US, Inc., HGP Storage alleged as follows:
• "Whinstone is based in Rockdale, Texas and its facility is located on an 100-acre site,
hosting Bitcoin mining customers in three buildings totaling 190,000 square feet. An
additional 60,000 square foot building is also under development. The site is subject to a
long-term lease agreement, with electricity provided via a long-term power supply contract."
• "Whinstone’s site has a total power capacity of 750 MW, with 300 MW currently
developed. Whinstone’s facility is believed to be the largest single facility, as measured
by developed capacity, in North America for Bitcoin mining. In pursuit of achieving the
most efficient power strategy, Whinstone combines fixed low-cost power agreements,
real-time spot power procurement and income from ancillary power services revenue.
Bitcoin miners benefit from low-cost energy to maximize production margins, benefiting
from an electricity supply with the flexibility to respond rapidly to supply and demand
events in the power market."
HGP Storage alleged, "ERCOT reported this week that 'a new low inertia level' was set on March 22nd, 2021."
"HGP’s experience leads us to believe that ERCOT needs real physical solutions, such as batteries
for system inertia. ERCOT should study if these hyper-loads for cryptocurrencies a) crowd out
investment in physical solutions, contribute to real-time price volatility and increase or decrease
the costs paid by consumers, uplift and financial costs to all market participants in ERCOT," HGP Storage said