21 Mar 2022

Which miners have access to the cheapest electricity?

Access to low-priced power is essential for miners to stay long-term competitive. Which public miners pay the least for their electricity?
Source: Public filings (Stronghold, Greenidge, Riot, Marathon, Argo, Hut 8, Core Scientific, Bit Digital, Hive, Bitfarms)
The only long-term advantage in mining is having lower costs than competitors. On average, power represents half of miners' cost structure, so it's critical for them to access cheap electricity.With a price of $18 per MWh, Stronghold is the publicly listed miner with the lowest power cost. Vertically integrated, Stronghold generates its own power and further lowers its power cost by receiving carbon credits for cleaning up coal residue.In the second place, we find another vertically integrated miner: Greenidge. Owning a power plant, the company can either sell their power to the grid or use it to mine bitcoin. Greenidge started as a pure power generating company but entered bitcoin mining as it vastly improved their economics. This article shows how much energy generators can earn by mining bitcoin compared to selling power to the grid.Mining margins are already low, as we show in this article. If they continue decreasing, some miners with higher power prices may struggle, leading to consolidation in the industry, as anticipated by Riot. Still, all the miners here have the same or lower power costs as Bitooda’s industry median estimate of $40 per MWh.
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