A recent study shows that Norwegian electricity service provider Salten Kraftsamband (SKS) dumped 340 Gigawatts hours (GWh) of hydropower last year. If this wasted energy had been channeled into Bitcoin mining, 1,800 BTCs (worth $48.6 million) would have been generated.
SKS Misses Out on 1,800 BTCs
Throughout 2022, the electricity-producing company produced a record-high 2,577 GWh of hydropower, representing a 20% increase from the previous year. However, the company fell short of utilizing produced energy due to damaged transmission infrastructure and restrictions to the distribution network caused by seasonal changes.
SKS eventually dumped 340 GWh of hydropower as water levels soared in its reservoirs, losing the chance to sit in profitable gains from use cases such as Bitcoin mining.
Effect of Electricity Tariffs on Bitcoin Mining
Bitcoin is a cryptocurrency that reaches consensus using a mechanism called Proof-of-Work (PoW). This process involves vigorous mining activity that drains electrical energy and rewards the miners with portions of bitcoins.
Last year, however, prices of electricity soared in several global regions in the wake of the COVID-19 pandemic and other international demands. Undoubtedly, this impacted the business operations of Bitcoin mining companies at the time as they struggled to make ends meet.
Several companies, like Core Scientific, Argo, and Marathon Digital Holdings, declared their financial struggles to the public. For example, Core Scientific filed for Chapter 11 bankruptcy protection last year as it was unable to keep its business running smoothly.
Argo, on its part, sold multiple mining machines to bolster its finances. Other platforms opted to sell part of their accumulated BTC holdings. Bitcoin’s reduced price range last year also contributed to the struggles of these companies.
Recent reports, however, show that the Bitcoin mining business is beginning to pick up once again. If SKS had diverted lost energy to Bitcoin mining, it would have recorded substantial gains alongside other Bitcoin mining firms as they rekindled their finances.
Your crypto deserves the best security. Get a Ledger hardware wallet for just $79!