Bitdeer, a mining firm that spun out from Chinese giant Bitmain and Riot Blockchain, one of the leading publicly traded Bitcoin stocks in the United States, have successfully teamed up to operate data centers that previously hosted an aluminium smelting facility (Alcoa) in Texan town of Rockdale.
Jointly, the two mining giants now plan to repurpose the aluminium smelting plant and instead utilize the energy produced to run a series of Bitcoin mining rigs.
Before winding up its operation in 2008, Alcoa was the world’s largest aluminium smelting facility. According to Lee Bratcher, the president of the Texas Blockchain Council, the facility’s energy went on wasted until recently when the local miners set up shop.
Despite hosting a tiny Texan town of just 5,600 residents, Rockdale features more benefits for industrial-scale mining including, crypto-friendly politicians, large plots of landlease holding abandoned industrial infrastructure that rips for repurposing, and relatively cheap electricity prices.
While commenting about the mining expansion, John King, the Rockdale Mayor, described the new integration between local grid operator, the Electric Reliability Council of Texas (ERCOT), and Bitcoin miners as “mutually beneficial.” King asserted that miners regularly utilize the power that would otherwise go to waste. Also, miners are somewhat flexible to shut down operations when power is needed elsewhere. He added:
“Miners are committed to buying a certain amount of power, and what they do is they sell it back at market [value] and make a profit. They have a contract of two cents or three cents, and they can sell it for $9 a kilowatt-hour.”
According to an analytic report released on October 7, Riot had tripled its Bitcoin production for this year at the time.
Riot now estimates producing more than 500BTC monthly from its facility in Rockdale. At current prices, the sum of mined coins equates to more than $30 million per month. Riot reveals that it is hosting 100,000 mining rigs in Rockdale.
Astoundingly, Texan lawmakers continue pushing for further expansion of Bitcoin mining, with Senator Ted Cruz recently describing mining as viable means to capture natural gas that states currently burn.
On October 10, 2021, while speaking during Texas Blockchain Summit, Cruz argued that natural gas is currently flared in West Texas simply because “there is no transmission equipment to transfer that natural gas to where people could use the same way natural gas would normally be employed.” He added:
“Use that power to mine Bitcoin. Part of the beauty of that is the instant you’re doing it you’re helping the environment enormously because rather than flaring the natural gas, you’re putting it to productive use.”