Did Anyone Do Even a Minimal Check on the Sensationalist Bitcoin Electrical Consumption Story?

Let’s start with a primer on how to write a sensationalist story that can be passed off as “journalism:”

1. Locate credible-sounding data that can be de-contextualized, i.e. sensationalized.

2. Present the data as “fact” rather than data that requires verification by disinterested researchers.

3. Exaggerate the data as much as possible and set the tone and context with emotionally laden words: “shocking,” etc.

4. Select a context that sensationalizes the conclusion.

Now let’s take a look at a story that has been swallowed whole, with little to no fact-checking or disinterested inquiry: bitcoin’s electrical consumption, i.e. the electricity consumed by mining/maintaining bitcoin’s blockchain.

One Bitcoin Transaction Now Uses as Much Energy as Your House in a Week

Let’s start by stipulating that energy consumption is a consequential matter worthy of serious inquiry. It’s important to measure the energy consumption of all the systems that operate within the current status quo, and compare the consumption levels of these systems.

With that in mind, let’s take a look at the story.

Right off the bat, the context we’re offered to grasp the enormity of bitcoin’s mining consumption is the electrical consumption of Nigeria, a nation, we’re breathlessly informed, with 186 million residents. Wow! That’s a crazy amount of electrical consumption, right?

Let’s do some very basic fact-checking before we accept sensationalist conclusions, shall we?

Nigeria consumes about 24 billion kWh annually, while the U.S. consumes 3,913 billion kWh annually.

So Nigeria uses 3/5th of 1% (0.6%) of the electricity the U.S. consumes.

Now let’s compare that electrical consumption with the amount of electricity consumed in the U.S. by residential devices and chargers on stand-by, i.e. appliances, devices, chargers, gizmos, etc. that aren’t in use and doing no work but that are still consuming electricity.

About a quarter of all residential energy consumption is used on devices in idle power mode, according to a study of Northern California by the Natural Resources Defense Council. That means that devices that are “off” or in standby or sleep mode can use up to the equivalent of 50 large power plants’ worth of electricity and cost more than $19 billion in electricity bills every year.

source: Just How Much Power Do Your Electronics Use When They Are ‘Off’? (May 7, 2016, New York Times)

(Please read the article to find out just how much power the 50+ gadgets in your home consume doing absolutely zero work.)

According to the U.S. Energy Information Administration, annual residential electrical consumption totals 1,410 billion kWh.

So 25% (the amount of household electricity consumed by stand-by devices) of 1,410 billion equals 352 billion kWh consumed annually by residential appliances and devices on stand-by in the U.S.

Now let’s compare the annual electrical consumption of Nigeria (24 B kWh) with the annual residential electrical consumption of devices on stand-by in the U.S.

The annual electrical consumption of Nigeria (24 B kWh) is 6.8% of the annual electrical consumed by household devices on stand-by in the U.S. That means the supposed consumption of bitcoin mining is 1/14th of the power lost to residential devices on stand-by in the U.S., devices doing essentially nothing.

Now let’s add in all the appliances and devices in government and private-sector offices on stand-by. Let’s conservatively estimate another 150 B kWh lost to all this stuff on stand-by.

Now let’s multiply the total of electricity lost to stuff on stand-by mode (doing no work whatsoever) in the U.S., 500 B kWh annually, by five, since the U.S. consumes roughly 20% of all electricity globally.

Electricity production 2016 (Enerdata)

The United States’ share of world energy consumption (EIA)

This gives us an estimate of all the electrical power lost to electrical appliances and devices on stand-by globally every year: 2,500 billion kHh. 1% of that wasted electricity is 25 billion kHh. If you reckon this seems high, let’s shave these totals to 1,500 billion kHh and 15 billion kHh.

Let’s go back to the story about bitcoin’s consumption of electricity which tells us “a shocking 215 kilowatt-hours (KWh) of juice (is) used by miners for each Bitcoin transaction.”

But then a few paragraphs down, we discover the electricity per transaction might only be 77 kWh– nobody really knows for sure. Hmm. 77 is 36% of 215, so the “shocking” consumption might overstate actual consumption by a factor of three?

Let’s choose a number between 77 and the “shocking” 215, since nobody really knows what the real number is: shall we guesstimate 135, or 2/3 of the high guesstimate? That would drop the annual consumption of bitcoin mining from 24 B kWh annually to 15 B kWh, less than 1% of the electricity wasted annually on stand-by devices doing no work whatsoever.

And so, um, bitcoin mining is a threat to the planet because it consumes less than 1% of all the electricity squandered by appliances and devices on stand-by? If we want to stop wasting so much energy, perhaps we should start by mandating near-zero stand-by power consumption for the hundreds of millions of devices which are not in use that are nonetheless sucking up electricity every second of every day.

Here’s another thought: check the context before uncritically accepting sensationalist conclusions.

 

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  • JdL

    In addition,

    One Bitcoin Transaction Now Uses as Much Energy as Your House in a Week

    …makes no sense, if only because the cost of one Bitcoin transaction is much less than I spend on electricity in a week.

  • Army of Addicts

    186 million. A little more than half the US population at 323 million. So, if we double Nigeria’s population to equal ours and double it’s electrical consumption, it still only would use 12-15 percent of what the US uses with all its electricity shut off.

    Gotta love capitalism. But according to Adam Smith, this must be God’s will.

  • Todd Millions

    good summation but-
    I’m very concerned that all crypto currency is like the rest of the blessed Al’s interweb (wry) is set up for
    Geometric increase in electrical consumption per transition. Or any action.
    This ploy has already being in train for more than a decade. Add too it the mal/spy advert ware burned in.
    This of course is too the benefit of Uber evil imps like tepco and their isreali “security contractors”(“Those who didn’t pay Always suffered catastrophic fires”.)
    It also ties into the push for ‘Tumors Are Us’ smart meters(“With iron dome features”-Henri Rothschild).
    It may indeed have come to the point that the twits using the smart phones can not get the essential points(any of them) in this very deliberately constructed reality but-
    -Power bar every thing and kill the switch on it when not in use.
    -refuse any meter with a X mitter (transmitter).
    -Let your phone supplier know that you will refuse any replacement phone unit that has more than 100 milliwatts (One Tenth of A Watt) of transmitter power and lacks a Wire plug with block diodes for a handset(remember that any speaker can be used as a mic.)
    The black electrical tape over the camera lens(or pin hole)trick also is effective and very cheap on smart appliances-Heloise recommends putting a square with the sticky Away from the aperture too be blocked, attached too the sticky side of the longer holding piece with a folded end too make peel off when you do want too use the camera and subsequent block replacement -easy. Without having too clean the adhesive off the spy hole.
    The foaming teeth gnashing this simple -customizing will cause with our securittaty, sets the whole assumable off nicely.
    Once you have enough of the population aware of these basic factors-Then adjustments too taxing end use of power consumption (supplied by owner or not) to make the cyber abortion set up- expotentailly more expensive to operate.
    This sin tax can be adjusted upward till actual power use conforms too Moore’s law.
    Which is Not the plan we are all supposed too buy into.

  • Marko

    The analysis I’d like to see , and I’m sure I’m not alone , is one that assumes that bitcoin becomes the new U.S. currency. What volume of transactions does it take to support a $20 trillion economy , with $100 trillion in net value of assets , and how much do you have to spend annually on the bitcoin mining juice to support that.

    If the mining costs are 2% of that $20 trillion in gdp , it’s too high. If the mining costs are not so high for a $20 trillion economy , but grow at a faster rate than the economy going forward , it’s unsustainable.

  • Alfred I Newman

    Fact check ?That’s time consuming and tedious.
    The latest hot dope on the nsa hotline is that ChuckHS is in the process
    of constructing a Democratic People’s Republic of Korea made, back yard type1,
    nuclear reactor to mine coins and go off grid to power the home+shop.
    40 acres and a [tesla]plough for every able bodied welfare refuser!
    A big screen TV,dishes +clothes washer/dryer in every residence NOW!
    A Nuke in every back yard….make America great again by force,glory to jesus!
    Yahoo up the Wazoo my fellow Americans

    • Greta

      Google is paying 97$ per hour,with weekly payouts.You can also avail this.
      On tuesday I got a great new Land Rover Range Rover from having earned $11752 this last four weeks..with-out any doubt it’s the most-comfortable job I have ever done .. It sounds unbelievable but you wont forgive yourself if you don’t check it GoogleNetJobsMarketWorkFromHome/find/jobs……

  • Sparticus

    Who Obsess with Government Spy Currency? Cash is more Secure.

    You have a problem in America where Jobs are being exported to slave labor nations; while costs of living are being pushed up by RIGGED MARKETS! This is far more important than Bit-coin.

    Americans have to learn, Government is to serve the people, not the people to serve government. All Wars for Industrial Profit MUST END and there will be Mega-Trillions in Savings! This money should be used to benefit the people with Medical Insurance and Basic Income to make up for all the LOST JOBS, ROBOTS and BANKER BAILOUTS! Nobody can afford an education, unless you`re RICH, so an educational package is also needed if America wants to be called Civilized.

    Can it be afforded … Sure, if America stops giving Trillions of Dollars to the MIC for Nothing! Your choice, America, benefits, or MURDER by MIC. You will be responsible: ” Government by and for the People, Remember?”