Bitcoin Miners in Texas Cut Production by 12% to 25% to Avoid High Electricity Costs

Major Bitcoin mining firms reported lower Bitcoin production during June 2024, primarily due to power curtailment in Texas. Miners voluntarily reduced operations to avoid high electricity costs during peak demand periods. Riot Platforms mined 450 Bitcoin, a 12% decrease from May’s 514 Bitcoin. The company engaged in Texas grid programs including ERCOT’s Four Coincident Peak (4CP). This program imposes transmission charges based on usage during June-September peak hours. Riot sold 397 Bitcoin for $41.7 million and retains 19,273 Bitcoin.

Cipher Mining produced 160 Bitcoin, selling 58 while holding 1,063. The company confirmed reduced output stemmed from deliberate power reduction. This formed part of their “proactive 4CP avoidance strategy.” Cipher stated this approach prevents costly penalties and maintains low operational expenses.

Marathon Digital mined 211 Bitcoin, down 25% from May’s 282. CEO Fred Thiel cited weather-related curtailment and equipment redeployment. Older machines operated temporarily at its Garden City, Texas facility during storm repairs. MARA sold no Bitcoin in June and holds 49,940 Bitcoin total.

CleanSpark reported contrasting results. Its production rose 6.7% to 445 Bitcoin. The company exceeded its mid-year hashrate target of 20 EH/s. CleanSpark sold only 8 Bitcoin, accumulating 6,591 Bitcoin in reserves.

Texas miners prioritize cost management during summer months. The ERCOT 4CP program incentivizes reduced consumption when grid demand peaks. Lower June output reflects strategic operational adjustments rather than systemic issues. The deliberate reduction in power usage by miners in Texas during June 2024 highlights a strategic approach to managing operational costs amidst peak demand periods. This proactive measure, driven by the ERCOT’s Four Coincident Peak (4CP) program, aims to mitigate high electricity costs and avoid penalties. The program imposes transmission charges based on usage during peak hours from June to September, prompting miners to adjust their operations accordingly. This strategy not only helps in cost management but also ensures the stability of the power grid during critical periods. The varying outcomes among different mining firms underscore the effectiveness of these strategies, with some firms like CleanSpark even reporting increased production despite the challenges. Overall, the June output reduction is a testament to the miners' adaptability and their commitment to sustainable and cost-effective operations.