For context, ERCOT manages the flow of electricity to more than 26 million Texans, representing approximately 90 percent of the state’s electric load. The council oversees an electric grid connecting more than 52,700 miles of transmission lines and 1,100 generation units.
As for the council’s demand response program, ERCOT offers crypto mining companies financial benefits such as tax incentives and subsidies for reducing power use when demand is too high. SB 1751 would end the practice.
According to a report from the Comptroller of Public Accounts, “experts believe that, per day, about 3,000 megawatts (MWs) of mining operations operate in Texas, or about 4 percent of peak demand (i.e., demand for electricity on its hottest days).”
In addition, ERCOT projects that mining operations could rise by 6,000 MWs in the next couple years and potentially increase to 17,000 MWs by 2030.
The concern is that the energy needed to reach these projections could overpower the state’s electric grid, leaving homes, businesses and government entities without power.
For example, larger companies, including Microsoft, Amazon and State Farm have data centers across the state that rely on the electric grid. In total, Data Center Map estimates there are 185 data centers across Texas.
However, Lee Bratcher, president of the Texas Blockchain Council, believes the bill would destabilize the state’s crypto mining industry, weakening the state’s free market principles and creating job loss.
As a result, Bratcher and his team formed a “Don’t Mess With Texas Innovation” campaign arguing four counterpoints:
- “SB 1751’s restrictions will raise rates for consumers. A fair and level playing field in the energy market increases competition for key grid services, reducing the cost Texans must pay for those services. Bitcoin miners often provide these services at the lowest price.”
- “SB 1751 will eliminate rural jobs. Digital asset miners account for over 2,000 direct jobs and 20,000 indirect or contract jobs in rural areas in Texas. SB 1751 would threaten those jobs and future growth in areas of Texas that have been left behind.”
- “SB 1751 is antithetical to Texas’ free market principles. SB 1751 arbitrarily picks winners and losers by limiting bitcoin miners’ participation in ERCOT’s Demand Response Program. SB 1751’s restriction is a first-of-its-kind limitation based on what the energy is being used for, making it a giveaway to other industries.
- “SB 1751 limits demand response participation when it’s needed most. It is no secret that Texas is increasingly experiencing tighter conditions on our grid. Demand response services have played a critical role in restoring power to the grid during tight conditions."
