Most of the conversations about Bitcoin infrastructure for the past two years have focused on the mining sector’s increasing convergence with traditional energy generators and power companies. At the Bitcoin 2022 conference, a panel[1] hosted by this author discussed this trend and what mining’s continued growth means for electric grids and energy markets. Beyond discussing how a grid works and demystifying some basic information about energy infrastructure, the panelists shared their perspectives on current trends, expected benefits and even some risks from a rapidly-growing mining sector forging long-term and large-scale partnerships with energy companies.
Mining growth has the potential to affect every market that uses energy, which is to say: everything. And this article summarizes some of the key insights shared by the panelists on what that future will look like. All the quotations and referenced comments in this article from the Bitcoin 2022 panel are hyperlinked with timestamps during the panel discussion.
Improved Power Pricing Mechanics
Bitcoin mining is radically changing some fundamental aspects of the power industry, and with these changes come new obstacles to overcome. “[Mining] is fundamentally an innovative approach to consuming power relative to what has happened for the last 95 years,” Harry Sudock, vice-president of strategy at GRIID, told the audience[2].
In 2019, energy companies were highly skeptical and in disbelief about signing power purchase agreements with mining companies like Sudock’s GRIID usually because of the sheer amount of power miners wanted to purchase. Sudock explained[3] that his team would hear responses from power companies to the effect of: “What? We’ve only signed a deal that big once in the last 30 years.”
Today, those phone calls with other power providers are easier. But discussions between miners and power providers can still improve in one
