The surge of bitcoin in popularity and value seems to cast a keen eye on the asset over its potential. Nevertheless, there is always a persistent question on the amount of electricity the crypto consumes and how it appears to fare with other entities.
Data acquired by Cryptovibes shows that bitcoin’s estimated annual consumption of 143 TWh as of May 5, 2021. That amount is about eight times higher than Google and Facebook’s cumulative consumption of 17 TWh. The social network consumption stands at about 12TwH while the search engine’s annual energy usage is at 5TWh.
When compared to individual countries’ annual electricity consumption, bitcoin is behind China’s 6,453 TWh which has exceeded it by around 45 times. Moreover, bitcoin’s consumption is around 27 times less than the United States’ 3,990 TWh. The asset’s consumption also accounts for nearly 69% of the cumulative energy that is used by world data centers.
Why Is BTC Electricity Consumption Contentious?
The debate on bitcoin power consumption has been continuing for several years, mostly whenever the price surges. Today, the asset has recorded a sustained bull run with the market cap surpassing the $1 trillion market. This increase in bitcoin’s values has reignited the sustainability debate.
The discussion on the amount of power required to sustain bitcoin’s network is mostly accompanied by the asset’s other criticism that includes the price volatility and ability to help illegal and criminal activities.
Bitcoin power consumption normally correlates with an increase in its value. It becomes quite profitable to mine the asset since more people are now selling and buying crypto to leverage the high and volatile price movements. It calls for more miners to confirm the transactions. Thus, the more miners involved in the mining process, the more computing power is required to solve the computing issues.
The crypto proponents think that putting BTC’s power consumption into a wider context is much beneficial. They say that power consumption is a small price to pay for the asset’s mining as it promises more benefits including financial inclusion and decentralization of the finance systems.
For Facebook and Google, their power consumption figure remains quite low. Interestingly, the companies’ vast power consumption goes mainly to their data centers. Nonetheless, the usage is forecasted to reduce after the firms made efforts to guarantee that data operations are more energy-efficient with renewable power and energy sources. For example, Google is making some efforts to supply every data center with an energy grid.
Elsewhere, Facebook is turning to find solutions through renewable sources. The company, as of 2019, committed to switching to renewable energy 100% for its global operations. The firm’s operations are now 86% powered by renewable power and energy sources.
Generally, the tech firms’ electricity consumption is forecasted to surge as a result of increasing internet traffic and data loads. Nonetheless, these firms are encountering the increased power consumption by changing to efficient means.
Apart from investing in renewable energy sources, the firms are also shutting down older facilities and favoring ultra-efficient centers. Generally, consuming less energy has now become part of Google and Facebook’s corporate social responsibility efforts.
Shift To Renewable Energy Might Make Bitcoin Sustainable
Elsewhere, the crypto industry is also embracing renewable energy sources. The BTC proponents think that as renewable energy sources emerge and become cheaper, the digital currency will also become significantly green. Thus, there is a consensus that bitcoin and the whole crypto industry must strive to lower their carbon footprints.
Additionally, bitcoin electricity consumption has been integrated into infrastructure, and there are massive advances in building ASICs, purpose-built chips to help in mining the crypto with a focus on less energy consumption.
With bitcoin going mainstream, friendly governments might support the industry by enhancing and supporting the setting up of mining firms near power grids, mostly renewable electricity. This initiative will see the miners use the excess power that is produced to mitigate the oversupply of electricity.
The model seems to be working in China where huge mining facilities have been established in the regions with excess energy that is cheap. Nonetheless, the debate on BTC’s sustainability might not cool down any time in the near term, mainly with the asset forecasted to keep rising in value, critics might focus on the power consumption of bitcoin.