Large Bitcoin miners may face new restrictions from the state as Texas tries to protect the state's electric grid from power-hungry customers. On Tuesday the Senate Committee on Business and Commerce heard testimony on a bill that would also mandate virtual currency mining shut down during times of a power emergency.
Riot Platforms operates a large bitcoin mining operation in a 100-acre facility in Rockdale. It is such a power user that when electricity is in short supply ERCOT pays them to curtail their operations.
Senate Bill 1751 would ban that kind of arrangement. The bill’s sponsor, State Senator Lois Kolkhorst from Brenham explained, “We’re trying to produce all this new power. We’re going to have a lot of this new power taken up by virtual currency mining. And then we’re going to pay them to go off the grid at different times, which I believe is a part of their business model.”
SB 1751 would also require large customers to coordinate directly with ERCOT in a power emergency. But other electric providers want the bill go further. Julia Harvey with the Texas Electric Coop told the panel, “We would further support a provision that requires these facilities to be off during an emergency, so we ensure that they are shed prior to any residential customer.”
SB 1751 also seeks to control electricity demand from bitcoin mining by restricting the tax incentives to lure them to Texas. “It bars virtual currency mining from tax abatements given that the large scale of growth in virtual currency mining is already projected to grow in the state,” says Kolkhorst.
Riot platforms’ bitcoin mining is well established in Rockdale, but they worry the proposal could limit their expansion plans. VP Pierre Rochard says, “These abatements have helped attract bitcoin miners to Texas and they’ve created hundreds of rural jobs. Bitcoin miners are the number 1 employer in Rockdale. Bitcoin miners are also the number 1 taxpayer to Rockdale ISD. Bitcoin mining is good for rural education.”
The company recently broke ground on a facility in Corsicana near Dallas, and ERCOT approved it for one gigawatt of power.
That's even bigger than their operation in Rockdale.