Why is US energy demand soaring - putting climate goals at risk?

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2. Texan Bitcoin miners profit

by using less electricity; advocates say all Texans should get the same chance

BY KEVIN VU AND EMILY FOXHALL
JAN. 3, 2024

When the news broke that Bitcoin mining company Riot Platforms made $32 million by reducing — or being willing to reduce if needed — its energy use last August in Texas, the outrage was immediate.

Riot made that giant sum of money because of how the state’s electricity market is designed. Companies that use large amounts of power, such as manufacturers or petrochemical plants, have long profited in similar ways.

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There are two ways that large power users can make money on the state’s main power grid, according to industry experts. The Electric Reliability Council of Texas, which operates the grid, pays large industrial users that promise to reduce their power consumption as needed, giving ERCOT some wiggle room in case a power plant unexpectedly fails or power demand is higher than forecast.

A company such as Riot also can profit by buying power at negotiated rates ahead of time — retail power companies allow big companies to lock in prices that way — then selling it back into the state market when energy prices soar during extreme heat or cold. In Riot’s case, when electricity prices soared during the summer heat wave, Riot sold power back to TXU, a Dallas-based electricity provider, which sold it back to the grid.

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So while the rest of us were sweating ourselves to death, bit coin companies cashed in. Same thing happened during the Great Freeze.