Topic: Cryptocurrency mining as a load-balancing mechanism for power utilities (Read 3907 times)

I like the idea. While Id prefer to see the excess electriciity shared locally I also see that its not allways possible. I know someone with solar panels, Ill ask him for numbers to figure out if its profitable. IIRC the return on the electricity given back to the grid was very small. And a few TH/s miners cost next to nothing in comparisson to a roof filled with solar panels. A problem could be reliabilty and heat though. If I have to make a one hour drive every week because the miner breaks down, it will not get broad acceptance. The heat could probably used for something else, the question is for what. Typicall days for extra electricity are sunny and thus "heating" should not be a problem.

Well, the problem with that is that transmission of power over a grid over long distances is typically inefficient.  It may be more cost-efficient to simply convert the energy to cryptocoins which are used later to offset the cost of fuel.  Also, what if there is a mismatch between renewable power production and demand over a large region (e.g. on a day that is particularly sunny or windy over much of the country).  Then, who do you sell the excess power to?  It still has to be stored somewhere, or used.  Currently, this is not as big of a problem, since renewable production is still only a small fraction of demand in most countries, but we can anticipate that this will not always remain the case.

I disagree.  The cost of photovoltaic panels has come down dramatically in recent years, to the point where in many places, PV is now cheaper per watt than grid power, with only a low payback period (few years) for capital cost recovery.  I know a miner who is building a complete solar-powered mining installation.  His operating costs are extremely low, and so his profit margins are much better than other miners'.  As other miners realize the feasibility of this approach, and the cost/watt of PV panels continues to come down, I predict that PV-powered mining will become more and more popular, and eventually will drive all traditional grid-powered mining out of the market due to the cost differential, also helping to drive widespread adoption of distributed solar power worldwide (at least in high-insolation areas).

Cheers...

This already happens without the use of bitcoin. People with solar panels can generally sell excess production (that generally occurs during peak demand times) back to the "grid" at retail prices. The cost of transmitting this energy is borne by the utility companies (and are ultimately socialized).

I do not think using "green" energy is a good way to use miners to make bitcoin

During some discussions at our local meetup group last night (http://www.meetup.com/Bitcoin-Tallahassee/), I realized that there is a use case for cryptocurrency mining as a load-balancing mechanism for renewable power utilities, in effect, using mined coins as a form of "stored energy."

The argument goes like this:  Suppose you have an installation of renewable power generation (solar, wind) whose production varies throughout the day, and is not necessarily well-matched to demand.

Currently, either the surplus energy needs to be stored (using expensive battery systems) or exported via inefficient long-distance transmission lines to other markets.

As an alternative:  Renewable power utilities could use their excess power (when available) to drive mining hardware, and collect the (approximate) value of the energy consumed in the process as cryptocurrency.

Then, later, when production is lower (at night, or on a cloudy/calm day), and falls below power demand, the saved coins can be used to buy back surplus energy from nearby partners on the grid, or alternatively, to pay for or offset the cost of fuel (coal/oil/gas/biofuels) to produce it locally.

By proposing this scenario to energy companies and co-ops, one could sell them on the idea of purchasing cryptocurrency mining hardware and doing mining and trading as a more economical means of load balancing, which will help make the adoption of renewables more profitable.  And, as the utilities accumulate cryptocurrency reserves, they will pressure more and more of their fuel suppliers to accept it as payment directly, thereby driving broader adoption of cryptocurrencies within the energy industry.  As renewables become more competitive, and more and more utilities try this approach, it could drive a fairly rapid shift from the "petrodollar" to bitcoin, or whatever.

Load balancing is already a pretty major issue even within traditional fossil-fuel-driven power markets, and with renewables being added to the mix, the problem will only get worse...  So this presents a big growth opportunity for cryptos.

I have contacts at our university's campus utility as well as with a regional co-op, and I'm planning to talk with them about this idea and see if I can get it adopted locally.

Cheers, -Mike