April 13, 2022
Bitcoin miners descend on Georgia to mint new currency
Georgia was the site of America's first gold rush in 1828 when miners flocked to the mountains near Dahlonega looking to strike it rich. Nearly 200 years later, a new wave of miners is descending on the state.
Instead of gold, they're mining a type of money that can't be hidden under a mattress or folded into a wallet. They're in the hunt for bitcoins, a cryptocurrency that has a global value of more than $1 trillion.
Since 2020, bitcoin mining companies have opened or expanded eight facilities across the the state, lured by some of the same benefits that bring other industries to Georgia: inexpensive land, low taxes and cheap electric rates for businesses.
It takes a lot of juice to keep computers humming at top speed and cooled 24/7—especially when it comes to cryptocurrency miners, which globally use as much energy as the country of Norway, according to a Cambridge University study.
Georgia has become a leading state in this ethereal industry, according to industry observers, even though hard numbers remain scarce. Texas, North Dakota and other states also are competing for new bitcoin miners.
The centers employ relatively few workers and gobble up massive amounts of electricity in an age when social and governmental pressures are pushing companies to reduce their carbon footprints. The facilities also generate non-stop noise from cooling equipment.
But they are welcomed with open arms by some communities, particularly in Georgia's tax-starved rural counties.
"When you're looking at fallow ground that's not generating any tax revenue on that dirt, any incremental improvement is better than nothing," said Tim Huffman, an executive at real estate brokerage firm CBRE.
The concept behind bitcoins and other cryptocurrencies is baffling to many raised on paying with credit cards and American greenbacks.
Cryptocurrencies exist only in the form of digital tokens that can be bought, sold or traded online, converted to hard currency or used to buy goods or services from merchants who accept them as payment.
Cryptocurrency miners use stacks of thousands of computers to run complex calculations that independently track and verify how each token is traded or spent. Doing all that work is also how the mining companies make a profit. Those solving the complex calculations to verify transactions can reap the rewards of earning newly generated bitcoins.
Cryptocurrencies are a long way from replacing traditional money, and their values swing widely. A bitcoin bought for $67,544 last November was worth $46,535 on April 1, according to CoinDesk, a website that tracks cryptocurrency news and values. Not so many years ago, bitcoin was worth almost nothing.
Rural areas of Georgia and small towns like Adel, Dalton, Fitzgerald and LaFayette lured the first wave of mining companies. In March, an Australian company announced an expansion of its facility in Sandersville, between Macon and Augusta.
Horace Daniel, chairman of the county commission in Washington County, the home of Sandersville, summed up why he supported it.
"I'm all for new jobs," he said.
An average bitcoin mining facility usually employs no more than 20 workers, such as electricians and technology specialists. That's less than many factories or warehouses, but it's still something.
The largely rural electric cooperatives and municipal-owned utilities also like miners because they provide a new source of revenue. And by serving more and bigger customers, the smaller utilities gain more leverage with Georgia Power, which sells power to them.
"They're able to negotiate better rates," said Matt Schultz, chairman of CleanSpark, which has mining facilities in College Park and Norcross, rather than rural areas.
College Park's municipal-owned utility gets 90% of its power from nuclear sources, the highest of any Georgia city.
To try to deflect criticism about energy consumption, many miners seek utilities that have solar, wind and nuclear power, which don't emit greenhouse gasses.
Georgia has a growing complex of alternate energy production, such as solar and wind, and it is adding nuclear capacity with Georgia Power's Plant Vogtle, though the project is years behind schedule.
The state also has relatively cheap energy, with an average rate of 9.93 cents per kilowatt hour, according to the most-recent figures from the U.S. Energy Information Administration. That's below the U.S. average of 10.59 cents.
Noise can also be a problem with bitcoin mining. A county in eastern Tennessee recently sued a bitcoin miner there over noise and sight pollution.
The mining operation in Adel, Georgia, has gotten complaints, with one couple reporting to WAXL News in Albany last December they had spent $5,000 trying to soundproof their house, but it was still driving them crazy.
Schultz said CleanSpark picked College Park partly because it's in the Hartsfield-Jackson International Airport flight path and jet-engine noise drowns out the sounds of bitcoin mining. CleanSpark also installed sound barriers around its facility.
"You can hear a low-pitched hum but it's just from the large fans we use," he said.
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