Bitcoin and its environmental impact

One of the common arguments of those who gang up against Bitcoin technology is the excess of energy that the system needs for its proper functioning.

It would be very difficult to determine exactly the amount at which Bitcoin’s energy consumption is considered to be above or below its optimal level. We would possibly end up discussing more philosophical or moral issues and this is not the purpose of this article.

The purpose of this article is to show a series of data that will allow anyone who wants to enter into the debate on Bitcoin energy consumption to have a more accurate and detailed view than the one told by the most controversial voices. A more contextualized vision that serves to take a position based on reference data.

Let’s get to it.


World energy consumption is currently estimated at 155,000 TWh (Terawatt-hours).

Due to inefficiency during the generation, storage and transport processes, it is estimated that around 35% of the total energy produced is lost, that is 54,000 TWh of energy is never used.

Bitcoin mining currently consumes around 220 TWh, which means 0.14% of world consumption. This amount is equivalent to 0.44% of the total energy wasted during the mining processes. We will see later why this is important.

To understand the magnitude from another perspective, we can compare the consumption of Bitcoin with other industries.

One of the industries with the highest energy consumption is residential construction, which represents around 26,500 TWh, non-residential construction 9,600 TWh, finance and insurance sector 5,000 TWh, gold mining 570 TWh, video games 214 TWh. The lights used for festive events such as Christmas 201 TWh.

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The energy used for the generation and distribution of electricity in the US is estimated at around 10,500 TWh, of which more than 60% is lost. This represents about 6,800 TWh of electrical energy lost or wasted.

With the 220 TWh consumed by Bitcoin mining, we are talking about its consumption being equivalent to 3.2% of the energy that is lost or wasted in the US alone.


According to the latest report prepared by the Bitcoin Mining Council (BMC), during the fourth quarter of 2021, 58% of the energy consumed by the Bitcoin network came from renewable sources, being up to 66% between the mining companies that are part of BMC, which generate 48% of the total computing power of the network.

This raises the sustainability of its consumption above the most energy sustainable country in the world, which is Germany with 48.5% of energy generated from renewable sources.

In the year 2021 the energy efficiency of Bitcoin mining grew enormously (efficiency measured by the number of Petahash (PH) for each Megawatt (MW) used).

From the first to the second quarter, efficiency rose 15%. From second to third 23%. From the third to the fourth 9%. This was largely due to improvements in mining equipment (called ASICS) and also improvements in facilities. This increases the computing power (hashrate) while reducing energy consumption.

Taking a longer time frame, it is estimated that the efficiency of mining equipment has increased by 5,800% in the last 8 years.

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Similarly, the energy mix of Bitcoin mining moved towards the use of cleaner energy from 38% in the first quarter to 58.5% in the fourth quarter.

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As we have seen above, the amount of energy produced by energy companies that is ultimately lost or wasted during the generation and transportation processes is very large. Statistically only by using a small part of that energy we could keep the Bitcoin network running. We could apply this to several industries, but a real phenomenon, that is power generators can (and should, in my opinion) look for alternative ways of harnessing energy. Bitcoin mining is a more than interesting option for this.

These companies could allocate part of the energy that will eventually be wasted (is not possible to consume because of the cost of transportation) to strengthen the capacity of the Bitcoin network, being immediately rewarded economically and supporting growing industry.


1.      Bitcoin today is just another industry among all those that exist. An industry that generates economic activity through the creation of new businesses, new jobs, new products and services, etc.

2.      Every industry needs energy generation and consumption.

3.      Bitcoin currently consumes 0.14% of the world’s energy consumption.

4.      The use of renewable energy in Bitcoin mining is already around 60%.

5.      Bitcoin’s energy efficiency is the highest among all industries. Moreover it continues to increase every day thanks to technological improvements.

6.      Energy companies need to improve the performance and efficiency of their business. Bitcoin can be an opportunity to do so.


From my point of view, the argument in favour of the use of energy in Bitcoin is clear.

On the one hand, because it is indisputable the growth of economic activity that has been generated around it. It is a sector that does not stop growing. Therefore, we have confirmation of the creation of a new industry that could well be equated to any other.

On the other hand, the quantitative and qualitative leap that Bitcoin has made in terms of increased efficiency during the processes of obtaining resources: greater computing power with less environmental impact. This is expected to continue to improve even more in the future.

Finally, to highlight the need for the energy industry to increase the utilization of the energy created and keep it covered in a better way the gaps in the different supply and demand peaks, although this would be another discussion.

This puts Bitcoin in an unbeatable position as a harbinger of a new era in the energy sector.

Bitcoin can be a key piece in this new puzzle.

In the next few years we are going to witness very big changes in the energy sector so we must be especially vigilant and as I always say… #HODL #Bitcoin.

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The computing power of the Bitcoin network is at an all-time high.

The data offered in this article comes from the latest report published by the Bitcoin Mining Council (BMC), which takes data on the evolution of the sector in 2021.