Bitcoin Mining in Sweden
(2022) FMIM01 20221Environmental and Energy Systems Studies
- Abstract
- Bitcoin mining is an industry which for many years has been criticized for its electricity consumption, which globally today equals roughly that of small countries such as Sweden, and its subsequent contribution to climate change. However, electricity consumption does not by default equals greenhouse
gas (GHG) emissions and not many studies have been done on the subject with a focus on Sweden, hence this study aims to provide some clarity to the otherwise opaque space of Bitcoin mining.
The study has been examining the effect Bitcoin mining operations have on the Swedish energy system, in terms of additional power consumption and GHG emissions, with a focus on electricity and heating. The study has partly been conducted as a response... (More) - Bitcoin mining is an industry which for many years has been criticized for its electricity consumption, which globally today equals roughly that of small countries such as Sweden, and its subsequent contribution to climate change. However, electricity consumption does not by default equals greenhouse
gas (GHG) emissions and not many studies have been done on the subject with a focus on Sweden, hence this study aims to provide some clarity to the otherwise opaque space of Bitcoin mining.
The study has been examining the effect Bitcoin mining operations have on the Swedish energy system, in terms of additional power consumption and GHG emissions, with a focus on electricity and heating. The study has partly been conducted as a response to the proposed ban of Bitcoin mining in Sweden and the European Union by the Director Generals at the Swedish Environmental Protection Agency and the Swedish Financial Supervisory Authority in the fall of 2021.
Data covering the Bitcoin mining space is in general opaque in terms of data availability and filled with nuances and perspectives depending on assumptions, hence multiple cases have been used to account for different carbon intensities, technologies, and time effects. Data sourcing has been combined with calculations and scenario analysis. The study is including an examination of the effects of heat recovery from the Bitcoin mining machines as well as power consumption and potential use of future excess electricity. Through the different cases it is observed that the effect Bitcoin mining has on the overall GHG emissions of Sweden corresponds to a rounding error, ranging in an interval of an increase of national GHG emissions by a tenth of a percent to a reduction of national GHG emissions of around half a percent depending on the different cases.
The study suggests that instead of banning Bitcoin mining operations within Sweden and the European Union, regulators should use administrative tools and economic incentives to encourage Bitcoin miners to use renewable energy and excess electricity. It is also reasonable to incentivize Bitcoin mining operations to
make use of the generated waste heat, which could potentially be used in the heating of individual homes or in large scale district heating facilities. The study also finds a potential use case for Bitcoin mining machines as a future substitute to electric heaters under certain technical conditions. (Less) - Popular Abstract (Swedish)
- Bitcoin mining är en industri som i flera år har kritiserats för sin elkonsumtion, som globalt idag motsvarar elkonsumtionen hos små länder som Sverige, och det tillhörande klimatavtrycket. Elkonsumtion är dock inte alltid likställt med växthusgasutsläpp och få studier har gjorts kring ämnet med fokus på Sverige. Detta är bakgrunden till arbetets genomförande som ämnar att bidra med nya rön till det annars inte särskilt transparenta området Bitcoin mining.
Studien har undersökt effekten som svensk Bitcoin mining verksamhet har på det svenska energisystemet i termer av elkonsumtion och växthusgasutsläpp, med fokus på el och värme. Studien har delvis genomförts i syfte som ett svar på det föreslagna förbudet mot Bitcoin mining verksamhet... (More) - Bitcoin mining är en industri som i flera år har kritiserats för sin elkonsumtion, som globalt idag motsvarar elkonsumtionen hos små länder som Sverige, och det tillhörande klimatavtrycket. Elkonsumtion är dock inte alltid likställt med växthusgasutsläpp och få studier har gjorts kring ämnet med fokus på Sverige. Detta är bakgrunden till arbetets genomförande som ämnar att bidra med nya rön till det annars inte särskilt transparenta området Bitcoin mining.
Studien har undersökt effekten som svensk Bitcoin mining verksamhet har på det svenska energisystemet i termer av elkonsumtion och växthusgasutsläpp, med fokus på el och värme. Studien har delvis genomförts i syfte som ett svar på det föreslagna förbudet mot Bitcoin mining verksamhet i Sverige och Europeiska
unionen som lades fram av generaldirektörerna för Finansinspektionen och Naturvårdsverket hösten 2021.
Data på Bitcoin mining industrins omfattning är generellt otillgänglig och ofta fylld med nyanser och olika perspektiv beroende på antaganden kring
emissionsfaktorer, teknologi och tidseffekter. Datainsamling har i studien kombinerats med beräkningar och scenarioanalys för att undersöka effekterna av värmeåtervinning från Bitcoin mining maskinerna, elanvändning samt utnyttjandet av överskottsproduktion av el. Genom de olika fallstudierna kan det fastslås att den svenska Bitcoin mining verksamhetens växthusgasutsläpp motsvarar ett avrundningsfel på de totala utsläppen i ett intervall från en promilles ökningen till en halv procents minskning av Sveriges totala växthusgasutsläpp beroende på de olika fallen.
Studien föreslår att istället för att förbjuda Bitcoin mining verksamhet i Sverige och i den Europeiska unionen borde reglering och styrmedel användas för att skapa ekonomiska incitament som gynnar klimatsmart Bitcoin mining verksamhet. Detta genom att exempelvis uppmuntra användningen av överskottsel samt återvinning av restvärmen, exempelvis via fjärrvärmesystemet. Vidare hittar studien ett
potentiellt användningsområde för Bitcoin mining som ett substitut till traditionell elvärme under specifika tekniska antaganden. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/9088586
- author
- Hager, Sixten LU
- supervisor
- organization
- alternative title
- Bitcoin Mining i Sverige
- course
- FMIM01 20221
- year
- 2022
- type
- H3 - Professional qualifications (4 Years - )
- subject
- keywords
- ASIC, Bitcoin, Bitcoin mining, proof-of-work, blockchain, district heating, heat recovery, climate change, Sweden
- report number
- ISRN LUTFD2/TFEM-22/5181--SE + (1-60)
- ISSN
- 1102-3651
- language
- English
- id
- 9088586
- date added to LUP
- 2022-06-14 14:57:23
- date last changed
- 2022-06-17 12:11:29
@misc{9088586,
abstract = {{Bitcoin mining is an industry which for many years has been criticized for its electricity consumption, which globally today equals roughly that of small countries such as Sweden, and its subsequent contribution to climate change. However, electricity consumption does not by default equals greenhouse
gas (GHG) emissions and not many studies have been done on the subject with a focus on Sweden, hence this study aims to provide some clarity to the otherwise opaque space of Bitcoin mining.
The study has been examining the effect Bitcoin mining operations have on the Swedish energy system, in terms of additional power consumption and GHG emissions, with a focus on electricity and heating. The study has partly been conducted as a response to the proposed ban of Bitcoin mining in Sweden and the European Union by the Director Generals at the Swedish Environmental Protection Agency and the Swedish Financial Supervisory Authority in the fall of 2021.
Data covering the Bitcoin mining space is in general opaque in terms of data availability and filled with nuances and perspectives depending on assumptions, hence multiple cases have been used to account for different carbon intensities, technologies, and time effects. Data sourcing has been combined with calculations and scenario analysis. The study is including an examination of the effects of heat recovery from the Bitcoin mining machines as well as power consumption and potential use of future excess electricity. Through the different cases it is observed that the effect Bitcoin mining has on the overall GHG emissions of Sweden corresponds to a rounding error, ranging in an interval of an increase of national GHG emissions by a tenth of a percent to a reduction of national GHG emissions of around half a percent depending on the different cases.
The study suggests that instead of banning Bitcoin mining operations within Sweden and the European Union, regulators should use administrative tools and economic incentives to encourage Bitcoin miners to use renewable energy and excess electricity. It is also reasonable to incentivize Bitcoin mining operations to
make use of the generated waste heat, which could potentially be used in the heating of individual homes or in large scale district heating facilities. The study also finds a potential use case for Bitcoin mining machines as a future substitute to electric heaters under certain technical conditions.}},
author = {{Hager, Sixten}},
issn = {{1102-3651}},
language = {{eng}},
note = {{Student Paper}},
title = {{Bitcoin Mining in Sweden}},
year = {{2022}},
}