Cryptocurrency miners looking for renewable energy options in southern Alberta

By COLLIN GALLANT on April 21, 2021.

cgallant@medicinehatnews.com@CollinGallant

Cryptocurrency firms are scoping out natural gas plants in the Medicine Hat and Lethbridge region for a site suitable for future wind and solar power development.

The end result would be “greener” digital currency, said the head of Neptune Digital Assets Corp., which last week raised $40 million in a share offering for the expansion.

“We’re looking at a couple options initially tied to gas, then we’d bring on (renewables),” said Cale Moodie, the CEO of Vancouver-based Neptune.

“Over time we’d ween ourselves off gas.”

The company’s partnership with Link Global Technologies, Inc. was announced in Mid-March toward developing a self-contained power source at a rural site in Alberta.

Initially a relatively small 5-megawatt gas-powered turbine would be installed at the site to power data-processing systems. Then it would stand in as backup power once solar panels or wind turbines are built, up to a potential 20-megawatt capacity in years ahead.

Improving renewables offer increasingly cheaper power supply, along with the potential for grant funding or offset credits, while running a less carbon-intensive operation. This could bolster favour with investors concerned with environmental social governance (ESG) in the energy-intensive sector.

Link provides design and commissioning services to the blockchain industry in Oregon, B.C. and already operates at three gas sites Alberta, according to the company.

The partnership created a new company, Pure Digital, and Link’s CEO Stephen Jenkins says his company will also “aggressively” source contracts from other solar facilities coming online elsewhere in Alberta to offset new cryptocurrency operations.

“The growth of solar power in Alberta will keep sustainable energy in the forefront of (Bitcoin) mining,” he stated in a release. “With the increased market adoption of BTC … we see the opportunity to expand our mining operations and secure long-term sustainable power.”

Link already operates three facilities in Alberta at once-shut-in or underused gas sites. The are located in Westlock County, Sturgeon County and another location described only as “Eastern Alberta” in company literature.

In recent months, some crypto miners have moved to address environmental concerns about the massive amount of energy used to power processing centres that compute digital transactions for Bitcoin users for a fee.

This winter, Hut8, which operates a major data-processing facility in Medicine Hat, announced it was in talks with power system developer Validus Power towards mobile data miners and gas-turbines that could make use of flare or waste gas at site in the U.S.

That is in line with a proposed methane reduction program as burning the gas lowers its greenhouse gas implication compared to methane.

In Alberta, utility regulations are lower for facilities with production capacity levels of 5 megawatts and less, especially for so-called behind-the-fence facilities that do not access the provincial grid to bring power in or sell off supply.

Moodie, who is a native of Edmonton, said the layout of Alberta’s power sector and rising outlook for cryptocurrency and a drive to diversify economic activity, mean interest in the digital currency sector will only grow.

“You’ll probably see a tonne of investment,” he told the News. “I’m from Alberta and it’s time we saw a divergence.

“There is a lot of concern about the impact, and we want to be on the other side on that.”