Economic viability of bitcoin mining using a renewable-based SOFC power system to supply the electrical power demand. (15th July 2020)

• Record Type: Journal Article
• Authors: Malfuzi, A.; Mehr, A.S.; Rosen, Marc A.; Alharthi, M.; Kurilova, A.A.
• Is Part Of: Energy. Volume 203(2020)
• Publication Date: 2020-07-15
• Subjects: Bitcoin -- Cryptocurrency -- Solid oxide fuel cell -- Biogas -- Economic analysis -- Renewable power system; Power resources -- Periodicals; Power (Mechanics) -- Periodicals; Energy consumption -- Periodicals; 333.7905
• DOI: 10.1016/j.energy.2020.117843
• Languages: English
• ISSNs: 0360-5442

Abstract

Abstract: One of Bitcoin's most significant problems is its seemingly insatiable use of electricity. In the present research, along with providing the required power for Bitcoin (BTC) mining, a solid oxide fuel cell (SOFC) system fed either by natural gas or biogas as a renewable source of energy is used to supply the electricity demand. Thermodynamic modeling for the fuel cell system is applied to determine the required biogas or natural gas. For the proposed cases (grid-based, natural gas-fed SOFC and biogas fed SOFC), various scenarios depending on the Bitcoin price and mining difficulty are proposed. Also, the economic viability for each scenario in several countries is investigated and compared. Results indicate more profitability for grid-based mining in Bitcoin prices up to $20, 000, but as the Bitcoin price increases SOFC based mining operations achieve reasonable profitability. It is shown that Iran, Russia, and China with cumulative cash flows of $87, 300, $77, 200 and $70, 500 respectively, are the best countries to mine BTC using grid electricity while Iran, Canada and Russia are the best countries using a natural gas-fed SOFC system. While the profitability of SOFC-based mining is lower than grid-based mining, the latter method compensates with better sustainability and lower environmental costs. Highlights: Bitcoin blockchain uses a large amount of electrical energy, estimated to be 73.1 TWh annually. The main factor in Bitcoin price is the price of electricity used in the mining process. Using grid electricity, Iran, Russia, and China are the best countries to mine BTC. Using natural gas-fed SOFC system, Iran, Canada, and Russia are the best countries to mine BTC. Using biogas-fed SOFC system for BTC mining operations may result in smaller profit margins but is cleaner.