Renewable energy is derived from solar, wind, and other ‘indefinite’ resources or operations that are renewed on a regular basis.
Non-depleting energy sources such as solar, tidal, wind energy are all classed as renewable energy.
In the world of blockchain, renewable energy has garnered a lot of attention. No matter how we look at it, there is a global issue that needs to be solved, and that is the substantial amount of energy consumed in cryptocurrency mining.
Blockchains is a distributed ledger that verifies, validates, and records transactions. They are public and free from a central authority and rely on mining via consensus protocols such as the Proof of Work (PoW) or Proof of Stake (PoS) algorithms.
Proof of Work is primarily intended to stimulate real-world resource mining in a digital setting using complex equations. To update and verify the network, computers operate in a computational race to solve a transaction code. Every 10 minutes, a new block is created. As a result, cryptocurrency is said to be mined by miners, which are essentially specialized computers.
There are over 1 million BTC miners worldwide, as well as millions of miners processing transactions for other Proof of Stake crypto networks, such as Litecoin and ETH. All of this crypto mining consumes a lot of energy, which has people all over the world concerned about its impact on the environment.
According to the University of Cambridge, BTC's energy consumption could range between 40 and 440 terawatts.
The rise of renewable energy has been accelerated by cryptocurrency mining. This is because miners go where the power is the cheapest. After all, cheaper power equals higher profits.
Several startups are currently researching and inventing ideas for developing alternative energy sources and recycling mining energy. Examples include Nasty Mining, which uses solar and wind energy; Swiss Alps Mining, which is constructing special hydropower plants and reusing mining energy, and many other similar projects.
The most significant benefit of renewable energy is its nearly limitless availability. Renewable energy sources, such as solar, wind, and hydroelectric, are excellent examples that can aid miners in their efforts. Another advantage is that it helps in preserving the environment.
Environmental concerns are the most serious criticism leveled at Bitcoin mining. CO2e, or carbon dioxide equivalent, is an excellent indicator for comparing the environmental impact of various energy sources because it is the carbon dioxide emissions for generating electricity per kilowatt-hour.
To generate 1 kWh of electricity, natural gas emits between 250 and 1000 grams of CO2. Wind energy, on the other hand, emits only about 9-18 grams of CO2e over its entire life cycle.
Elon Musk shocked the world when he announced that he would no longer accept Bitcoin payments for Tesla vehicles, citing the harmful impact of the environmental deterioration caused by the mining.
Also, renewable energy sources are not prone to sharp price fluctuations because their supply is not limited. Furthermore, the price of natural energy sources has steadily decreased over time, despite the world's ever-increasing volume of production and wider adoption in various industries. As a result, the entire renewable energy industry has gained efficiency, increased production capacity, and achieved economies of scale over time.
According to the International Energy Agency (IEA), solar energy is currently the cheapest source of energy when compared to coal and gas, which are still used by many countries.
As a result, the cryptocurrency mining industry can also benefit quickly from these renewable energy factors, as it will create a significant positive mood.
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