The Cost & Sustainability of Bitcoin — Part VII — Environmental Inputs & Drivers
Environmental costs can be broken down into the CAPEX stage of an ASIC miner, as well as its OPEX phase. The breakdown is as follows
CAPEX
To better assess the overall impact of the bitcoin mining industry, we should also consider the CO2 emissions from the manufacture and recycling of mining equipment.
A study using data from 2000[1] suggests that total energy to produce a PC is 895kWh. Although the data is quite dated, it sets a very conservative benchmark, as manufacturing efficiencies consistently improve in line with the laws of competition, alongside Moore & Koomey’s laws discussed earlier in the series.
As 98% of electronic waste is completely recyclable[2], and an estimated energy saving of 90% on the recovery of metals and silicon[3], we will reduce the “Bulk Materials” energy use by 90%, to result in a total of 703 kWh. Recycling of ASICs is a fair assumption due to the short life of mining equipment, and the value to be extracted out of quickly obsolete equipment through means of recycling.
OPEX
Environmental Impact from operations is effectively pure energy use. If miners are using cheap hydroelectricity to mine, emissions are insignificant. If miners are using dirty coal with no carbon capture, environmental impact is much higher.
It is assumed that the average miner will use power that emits a weighted average value of CO2 based on the world’s average energy mix — which is, 600g of CO2e/kWh as per Part VI of this series.
References
[1] E. Williams, “Energy intensity of computer manufacturing: hybrid assessment combining process and economic input-output methods,” Environ Sci and Technol, vol. 38, 2004, pp. 6166–6174.
[2] Australian Bureau of Statistics, 2013, “Waste Account, Australia, Experimental Estimates, 2013 — Electronic and Electrical Waste”, http://archive.is/EZHST
[3] Zhang, K., Schnoor, J., Zeng, E., 2012, “E-Waste Recycling: Where Does it Go from Here?”, Environment, Science, Technology, Vol 46, pp 10861–10867, http://cedar-rock.ca/pdf/E-Waste_Recyling.pdf (accessed 20 June 2018)
