Bitcoin mining embraces sustainability goals as over 50% of energy comes from renewable sources.
As of the first quarter, more than 50% of the energy used for Bitcoin (BTC) mining comes from sustainable sources, according to insights from the Cambridge Centre for Alternative Finance’s report on the digital mining sector.
In spite of rising energy usage, the sector has increased its dependence on sustainable energy, with operational indicators showing a trend towards long-term viability through innovative practices and diversification.
The total estimated annual electricity usage for Bitcoin mining climbed to 138 terawatt-hours (TWh), reflecting a 17% increase from the previous year. Mining-related greenhouse gas emissions reached 39.8 million tonnes of CO₂e, contributing to 0.08% of global emissions.
While natural gas remained the predominant energy source at 38.2%, renewable sources such as hydropower and wind energy collectively represented 52.4% of the overall electricity utilized in mining.
North American leadership
The United States continued to lead in the global mining arena, accounting for 75.4% of the reported Bitcoin hash rate, with Canada trailing at 7.1%.
New mining activities have surfaced in South America and the Middle East; however, North America retains a firm lead in the sector.
The market for mining hardware is highly concentrated, with Bitmain controlling 82% of the market share. The top three manufacturers—Bitmain, MicroBT, and Canaan—collectively dominate over 99% of the industry.
There has been a notable improvement in ASIC efficiency, now at 28.2 joules per terahash, showing a 24% increase in efficiency when compared to the previous year.
Electronic waste (e-waste) levels were managed effectively, with 86.9% of obsolete mining equipment anticipated to be either reused or recycled. The estimated e-waste output during the evaluated period was around 2.3 kilotonnes.
Economic challenges for miners
Electricity costs comprised over 80% of miners’ total operational expenses, with a median cost of $45 per megawatt-hour, leading to average overall operating expenses of $55.50 per megawatt-hour.
Despite profit margins being squeezed due to halving impacts, the industry maintained profitability by enhancing efficiency and implementing power management tactics.
Miners surveyed highlighted energy price fluctuations and regulatory uncertainty as their key challenges. To counter these issues, they adopted strategies like business diversification, geographic expansion, and power hedging.
The report indicated that limited capacity for deployment and supply chain constraints for hardware were significant obstacles to the sector’s growth.
Predictions showed that miners displayed strong forecasting abilities, with a median anticipated Bitcoin price of $80,500 by year-end 2024, compared to the actual closing price of $93,390.
The expected network hash rate of 750 exahashes per second (EH/s) was closely aligned with the actual hash rate of 796 EH/s that was observed.
Exploration of new revenue avenues and environmental efforts
The conventional revenue structure for miners, primarily based on block subsidies, is encountering increasing pressure due to changing market dynamics.
To adapt, mining companies are venturing into high-performance computing, especially in supporting artificial intelligence workloads, while also investigating opportunities in sustainable energy.
Advancements in energy management have become central to operations, with mining firms participating in projects aimed at reducing gas flaring, recovering waste heat, and joining demand response initiatives to better align with power infrastructure.
Around 70.8% of the miners surveyed reported being actively involved in climate action strategies, highlighting a collective effort within the industry to minimize environmental harm.
The report concluded that the Bitcoin mining landscape is transitioning towards a more diversified and sustainable operational framework, shaped by technological, economic, and ecological factors.
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