Tasmania is emerging as a global centre for bitcoin mining, with firms lured by its 200 per cent renewable energy target, but the boom could spell trouble for other energy-intensive industries.
New bitcoin miner Digital Asset Mining Enterprise (DAME), said it planned to set up a global-scale operation in 2022 in Northern Tasmania, home to existing player Firmus.
More are tipped to follow, as bitcoin miners – who collectively use more energy than some developed countries to power and cool supercomputers – flock to renewables, countering criticism that they drive global greenhouse gas emissions.
Bitcoin miners use fast, powerful, energy-hungry computers to compete globally to validate bitcoin transactions, being paid in bitcoin when successful.
Some are well-placed to transition to other supercomputing tasks, such as artificial intelligence, as they evolve.
Unlike traditional big power users, such as smelters, they claim to offer stability to the grid, due to their ability to quickly scale up or down usage in response to load peaks and troughs. They also argue that unlike major industrial energy users – and hydrogen proponents – they do not seek subsidised power, instead offering grid stabilisation services.
Pitched as a “partner not parasite” approach, it could potentially undermine demands by big manufacturing plants and hydrogen-spruikers such as Andrew “Twiggy” Forrest for cheap power.
Tasmanian energy analyst Marc White, of Goanna Energy, said supercomputer centres offered advantages in terms of load management and could create a new energy sector dynamic.
“If you’ve got one industry that’s prepared to pay market rates, prepared to value the green credentials and prepared to invest … and another industry that’s got its hand out all the time, you’ve got to question the benefits,” he said.
DAME chief executive Cam Nelson played down the impact on hydrogen or other big energy users. “Green hydrogen or any other battery storage technology is going to have a role to play in the future,” he said.
“Is it commercially viable today? As by the request from Twiggy, it requires some subsidy.
“We’re not coming out here and saying you can’t do other things in Tasmania; you can only do bitcoin mining. We are saying ‘how can we help?’ ”
That help may include driving wind farm development in Tasmania, where at least a dozen projects are being developed in anticipation of a second “Marinus” interconnector allowing export of power to the mainland.
Mr Nelson said that by signing “offtake” deals, supercomputer plants could help bring forward such projects, even before Marinus. The company had already conducted trials in Tasmania and in 2022 would set up its first operation in the state’s north, operating initially at 50MW to 100MW capacity.
Longer term, it has flagged scaling up to 350MW and eventually 1GW capacity. It plans to manufacture racking and cooling equipment at Burnie.
“We are looking to provide a service on a scale that would mean that we are competitive on the world market,” Mr Nelson said. DAME was working with Tasmanian power enterprises and found the state’s approach “positive and constructive”.
“We’re not coming with our hands out,” he said.
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