An approach to targeting cryptocurrency mining loads for energy efficiency enhancement

Abstract

Abstract In recent years, the mining of cryptocurrencies such as Bitcoin has attracted much global attention due to the simplicity and high profitability of this business, especially in countries with low electricity rates. The process of cryptocurrency mining using cryptocurrency mining devices requires a significant amount of computing power. This industry, which is increasingly growing in energy and carbon emissions, can cause environmental concerns. Common ways to reduce this amount of energy consumption are to prohibit mining and charge these loads at a higher electricity rate; however, these solution methods are not feasible and applicable in many countries. This paper presents an energy efficiency program to persuade the customers to mine cryptocurrency using high‐efficient cryptocurrency mining devices (CMDs), including informative, regulation, and financial policy instruments. This energy efficiency approach suggests a standard, if implemented, would ban the application of inefficient CMDs, and would encourage the cryptocurrency miners to improve the profitability of their business with high‐efficient CMDs through a penalty‐reward strategy. The performance of this energy efficiency program is studied through an analysis of data gathered from different CMDs used in Iran. The effectiveness of this suggested program is proved through its sufficient incentives for miners using high‐efficient CMDs.

Keywords

• Bitcoin
• cryptocurrency
• energy efficiency
• financial instrument
• policy instrument