An upstate New York power plant has been using some of its own electricity to mine bitcoin on an industrial scale.
Greenidge Generation, a natural gas power plant near the town of Dresden in the Finger Lakes region, announced it had successfully installed a mining farm in its facility. Comprised of nearly 7,000 mining rigs and powered by electricity generated on-site, the facility can mine an average of 5.5 bitcoins (BTC) every day, roughly $50,000, according to CoinDesk's Bitcoin Price Index.
Greenidge uses its own "behind the meter" power, the generated electricity it uses itself at the basic cost of production. Kevin Zhang, director of Greenidge's blockchain strategies, said in a statement the initiative would provide potential investors with unique exposure to both the cryptocurrency and energy markets.
The server farm comes as part of an extensive $65 million renovation of the power plant, which includes transforming the plant from coal to natural gas as well as investing in the electrical infrastructure needed to power the mining rigs.
Following the plant's conversion to natural gas, with both state and federal approval, in 2017, Greenidge Chief Executive Dale Irwin said the mining operation would complement the "power plant's unique commitment to environmental stewardship."
Because costs are already low and predictable, plant owners say they are in a "favorable market position" and believe they will remain profitable even after the halving event takes bitcoin's block reward down to 6.25 BTC in May.
“Due to our unique position as a co-generation facility, we are able to make money in down markets so that we’re available to catch the upside of volatile price swings," said Tim Rainey, Greenidge's chief financial officer, to Bloomberg.
First established in 1937, Greenidge is now owned by Connecticut-based Atlas Holdings, which helped install the mining rigs in the facility in the space of four months. The plant used to only open at peak times in the summer and winter months; the new mining initiative means it now operates all year round.
The server farm currently consumes 14 megawatts of the 106 megawatts of Greenidge's capacity. That's enough electricity to power well over 11,000 average U.S. homes.
UPDATE (Mar. 5, 14:15 UTC): A previous version of this article said the mining farm was worth $65 million. This has since been updated to clarify the mining farm came as part of a $65 million renovation of the power plant as a whole.