Bitcoin mining is getting greener, but the debate isn't over

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Bitcoin mining is getting greener

Bitcoin didn’t change. The industry did.

Bitcoin mining’s environmental footprint is back in focus after new research from the Cambridge Centre for Alternative Finance found that hydropower has overtaken natural gas as the network’s largest source of electricity. According to the report, low-carbon energy now accounts for 59.4% of Bitcoin's power mix.

The findings come with an important caveat. Annual electricity consumption has climbed to around 190 TWh, meaning the industry is using more power than ever even as its energy sources become cleaner.

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The numbers mark a significant shift for an industry that, until recently, was defined almost entirely by its environmental footprint.

The industry’s biggest image problem

That wasn’t always the conversation.

For years, Bitcoin mining was one of cryptocurrency's biggest public relations challenges. Environmental groups argued that the network's electricity consumption made it incompatible with global climate goals. Governments debated restrictions, investors questioned its sustainability, and headlines regularly compared Bitcoin's energy use to that of entire countries.

The criticism reached its peak in 2022, when Greenpeace USA, backed by Ripple co-founder Chris Larsen, launched its “Change the Code, Not the Climate” campaign, urging Bitcoin to abandon its energy-intensive Proof-of-Work consensus mechanism.

Ethereum eventually made that transition. Bitcoin never did.

Following economics, not ideology

Bitcoin miners are not rewarded for using renewable electricity. They are rewarded for finding the lowest-cost electricity.

Power remains the industry’s largest operating expense, pushing miners toward regions where energy is abundant and inexpensive. Increasingly, that means hydropower, geothermal energy, surplus wind and solar generation, or electricity that might otherwise go unused.

“The major energy source for Bitcoin mining is hydropower,” sustainability researcher Daniel Batten wrote while commenting on the Cambridge findings.

One of the clearest examples is Bhutan. The Himalayan nation has quietly expanded state-backed Bitcoin mining powered largely by surplus hydropower, turning excess electricity into an additional source of revenue instead of exporting all of it abroad. Similar trends are emerging in countries such as Ethiopia, where cheap hydroelectric power has attracted growing mining investment.

The industry’s changing energy mix appears to be driven as much by economics as by environmental ambition.

A different business after the halving

Mining has also become a much tougher business. Bitcoin’s 2024 halving cut block rewards in half, squeezing profit margins across the industry. Rising network difficulty, more efficient hardware, and growing competition have forced miners to lower costs wherever possible.

Some companies, including Core Scientific, Hive Digital, and Hut 8, have expanded into AI and high-performance computing to diversify revenue. Others continue focusing on what has always mattered most: securing cheaper electricity.

As margins tighten, access to low-cost energy has become one of the industry’s biggest competitive advantages.

The debate isn’t over

Not everyone sees the changing energy mix as evidence that Bitcoin’s environmental problems are being solved.

Alex de Vries, founder of Digiconomist and one of Bitcoin mining’s best-known critics, argues that improvements in electricity sourcing should not distract from the network’s growing energy demand and broader environmental costs, including electronic waste. He has also questioned whether claims that mining supports renewable energy are backed by sufficient independent evidence.

Greenpeace has made similar arguments, maintaining that cleaner electricity alone does not eliminate the environmental impact of an industry whose total electricity consumption continues to grow.

Supporters offer a different perspective. They argue that Bitcoin mining increasingly functions as a flexible electricity consumer, capable of absorbing surplus renewable generation and reducing consumption during periods of peak demand. Texas has become one of the best-known examples, with miners participating in demand response programs designed to help stabilize the state’s electricity grid.

A different conversation

A few years ago, much of the discussion centered on whether Bitcoin’s environmental impact could only be reduced by changing the protocol itself.

That never happened.

Instead, the industry adapted around it. Mining companies changed where they operate, how they source electricity, and how they compete in an increasingly challenging business. Whether those changes are enough to satisfy critics remains open to debate, but the conversation surrounding Bitcoin mining is no longer the same as it was just a few years ago.

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