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A bitcoin mining operation is opening this month at the site of the last working coal plant in New York State, northeast of Niagara Falls.

A former aluminum plant in Massena, currently one of the largest cryptocurrency sites in the United States, is expanding across the state.

And in Owego, metal recycling king with 11.3 million Instagram followers get off to a bold start with computer banks in shipping containers next to a junkyard.

Rising Bitcoin values ​​may be Wall Street’s investment talk, but a few hours north, there is buzz in New York City about companies trying to create digital currency by “mining” almost any type and size of computer farm. It constantly buzzes between transactions.

In just a few years, parts of northern and western New York one of the biggest Bitcoin producers in the country. The prospectors in this digital gold stream need lots of cheap electricity to run thousands of energy-consuming computer equipment.

The area – with cheap hydroelectric power and numerous shuttered power plants and old factories – was ripe for Bitcoin mining. Abandoned infrastructure can often be easily converted with existing connections to the electricity grid. Bitcoin mining.

The companies say they are boosting local economies by bringing the industry back and creating a crypto pioneer north of New York City, where Bitcoin stocks are unpredictable. reach record levels on Wall Street this year and incoming mayor Eric Adams predicted cryptocurrency hub.

But the surge in activity has sparked a growing backlash over the amount of electricity and pollution associated with Bitcoin mining. Globally, cryptocurrency mining is said to consume more electricity per year than all of Argentina. China, once home to perhaps two-thirds of all crypto mining, banned the practice this year and drove some miners to New York City to help it meet its carbon reduction goals.

As a result, environmental groups say the Wild West-style mess combined with the lack of restrictions on Bitcoin mining threatens the state’s own emissions reduction targets, which require more renewable energy and rapid reductions in fossil fuel emissions.

Bitcoin mining companies usually only need basic construction or planning permits from local governments; many of these have withered industrial towns eager for any new business tax revenue they can generate.

In the Finger Lakes region, a former coal plant on pristine Seneca Lake has been converted into a Greenidge Generation natural gas combustion plant, which now powers on-site Bitcoin mining. Near Buffalo, a Bitcoin company is seeking cheaper electricity by taking over a part-time gas-fired power plant and taking over for 24-hour use.

The increase in greenhouse gas emissions, accelerating the impact of climate change, say Environmental groups Like Earthjustice and the Sierra Club, which monitor many former natural gas facilities in New York and are easily repurposed as Bitcoin mining operations.

Facilities receiving renewable energy from the grid also received complaints. Because a large Bitcoin mining facility can use more electricity than most cities in the state, environmentalists warn that crypto mining will leave other areas dependent on fossil fuel power.

The abundance of hydroelectric power and other forms of renewable energy outside the city helps the big mining companies that buy it in bulk to advertise themselves as environmentally friendly.

The facility, which opened in Somerset, NY this month northeast of Niagara Falls, is part of a $550 million project by Terrawulf, a Bitcoin mining company. The project also includes a proposed 150-megawatt data center at a former coal power plant on Cayuga Lake in the Finger Lakes.

Terrawulf’s CEO, Paul Prager, said the Somerset facility will use hydroelectric power salvaged from waterfalls, which is difficult to ship elsewhere due to grid congestion.

“We look at the regulations as a really good thing,” he said, as the facility will abide by the state’s environmental guidelines and not cause air pollution.

However, New York does not impose any restrictions on mining, although companies dealing with many aspects of Bitcoin activity, including currency trading, require licenses.

Some municipalities included Plattsburgh and MassenaTwo early Bitcoin mining destinations near the Canadian border have applied for moratoriums in practice.

The bans have since been lifted, but some lawmakers want to make New York one of the first states to ban certain Bitcoin mining. In June, the State Senate passed a bill that would impose a statewide moratorium on some fossil fuel-powered mining; The law died in Parliament.

“It’s been easy for these companies to fly under the radar because the whole industry is confusing to understand in the first place,” said Congresswoman Anna R. Kelles, a Democrat who represents the Ithaca area and sponsored the bill. “It is too new an industry to be regulated federally or statewide in terms of greenhouse gas emissions and its impact on water and air.” (Ms. Kelles said she plans to revive the bill next year.)

For the same reason, some environmental activists urged Governor Kathy Hochul to issue an executive order to ban some crypto mining.

In 2017, the enclosed coal plant in Seneca Lake was converted into a natural gas-fired power plant by Greenidge, which was then owned by Atlas Holdings, a private equity firm with a $6 billion stake. Greenidge is now promoting itself as the first publicly traded company with a bitcoin mine integrated as part of a power plant. The power plant has a capacity of 106 megawatts, enabling it to generate enough electricity to power approximately 85,000 homes.

Dale Irwin, Greenidge’s CEO, said in a statement that the facility “creates a new economic engine that brings a piece of the world’s digital future to New York.”

But greenhouse gas emissions have increased with the mining operations of the facility, and so has opposition from some local residents who describe the facility as an environmental threat to these rural vineyards, farmlands, pristine waterways and prime gorges.

A local blogger He reported on Greenidge’s permission to draw more than 100 million gallons of water per day from Seneca Lake for cooling purposes and then return it to a nearby trout stream tributary at warmer levels.

Mr Irwin said the outflow poses no danger and the lake temperatures measured daily by independent sources are unaffected.

He said that although the plant’s emissions have increased since 2019, they are still well below government-permitted levels. He insisted that the plant poses no environmental threat.

Greenidge is applying to the state to renew its air emissions permits, and opponents see an opportunity for the state to block the company’s expansion.

Elected officials, including U.S. Senators Kirsten Gillibrand and Chuck Schumer, have asked state and federal regulators to closely examine the facility’s application.

With increasing political and public pressure, Basil Seggos, the state’s commissioner for environmental protection, said: wrote on twitter “Greenidge failed to comply with NY’s climate law,” in September. He urged residents to participate in the public comment period on permit renewal.

Greenidge received local planning board approval from the town of Torrey in April to build several structures at the site.

Patrick H. Flynn, 79, a farmer and mayor of Torrey, described Greenidge as a boon for the area and said renewable energy was “overdone”.

“We can’t restrict a job,” he said. “Whether they are producing Bitcoin, it is no different than raising cattle, pigs or chickens.”

Yvonne Taylor, vice president of the Seneca Lake Guardian, a local conservation group, accused state officials of failing to require an environmental review before allowing Greenidge, and essentially leaving the approvals to local governments.

“It can’t be a town-to-town fight,” said Ms. Taylor, a speech pathologist whose family has lived in Seneca Lake for generations. We need the governor to step in. If it wants to be a champion on climate, it needs to adopt a moratorium on this type of energy-intensive cryptocurrency or we will never achieve our climate goals.”

Greenidge’s situation is not unique. Bitcoin company Digihost, which is reviving a gas-fired power plant in Buffalo, has faced criticism that its increased gas emissions will affect areas long plagued by industrial toxins. Between them love channel, the Niagara Falls neighborhood notorious for its toxic landfill that has harmed hundreds of residents.

But local officials largely approved of Digihost’s plans because the environmental impact of the new operation seemed minimal compared to the benefits the company was expected to bring, including new jobs and annual fees for municipal water to cool the facility, said Robert Pecoraro. , chairman of the joint council in North Tonawanda, where the plant is located.

Digihost officials say the facility will operate within state emissions limits, begin to switch to more renewable energy sources over time, feed the grid as needed, and help keep up with western New York’s tech industry while creating at least 30 permanent jobs.

Mr. Pecoraro recently stood outside the gas plant and watched workers build a large shed to house the new servers. He told Digihost that he did not understand the opposition and the economic boost it would bring to the region.

“Many industries have been left behind over the years,” he said. “And we’re trying to get Digihost involved here, and people are fighting us about it.”