Power Solutions for the Crypto Mining Industry in 2023

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Crypto mining is a profitable business and lucrative for investors however it’s a bit complicated. The mining business started as a well-paid hobby for the early adaptors and tech savvies who had a chance to mine 5 BTC per minute and now become millionaires. One of the items that make this business now a bit complicated is the hardware. The more energy-efficient and powerful hardware means more profit for the company. In general, it takes a lot of energy to keep crypto-mining devices up and running. This creates a real concern for the mining industry. Crypto field mines and operates 24/7 and that makes mining more a risky business.

What is a crypto mining farm/rig?

It’s a computer with multi-powerful graphic cards or GPUs while in a standard computer generally one graphic card is used. using multiple GPUs in a single mining rig needs a lot of power to keep them running. A Large array of miners or rigs that are housed in a warehouse is called a mining farm. Tow factors are important to keep a mining farm up and running; reliable power and sufficient cooling. As we discussed running a miner we need a reliable source of power and the result of working these devices would be a lot of generated heat which needed to be removed from the warehouse. Creating sufficient cooling also comes with a decent amount of power consumption.

For investors, to make their mining business profitable have them parallel hundreds or sometimes thousands of rigs running in one place. More rigs mean more generated heats which forces owners to provide an external cooling source in addition to the original computer’s fans.

Power options for a crypto mining farm

As we discussed a crypto farm needs a lot of power which practically an established grid power from cities or national grid network can not provide that amount of excessive power in a short period of time. Even sometimes with the available power from the city or national network, the electricity price is so expensive that makes crypto mining infeasible. Therefore, investors need to find an alternative solution for the power supply of their farms. Here we try to name different power solutions for the crypto mining industry.

Rental Power Solution:

Generally, the life cycle of mining devices is around 5 years sometimes investors of a crypto farm decide to go with a short-term rental power solution instead of providing an established powerplant owned by them. The rental solution makes more sense when the city has ongoing power supply projects which soon or later can provide the required amount of power for the crypto farm via the grid. The only thing that you need to provide for a rental power provider is a good amount of natural gas available near your farm. In general, rental providers handle the operation and maintenance of their generators which makes your life easier as a crypto farm investor. However, this type of turnkey power rental solution is so expensive that sometimes makes the whole project infeasible. In some cases, the turnkey rental costs are almost equal to the CAPEX of buying all generators and related equipment. This high cost makes investors to hesitate of considering rental generators as a long-term solution.

Short term solution
High cost
Easy to execute
Available immediately

Gas engine generator set

Gas engines seem to be a good choice for the power source of a crypto mining farm. Gas engines have a high power generation efficiency, more than 40%, which makes them a good fit when power is the only utility that is important in our project. Nowadays gas engine efficiencies are even higher than 50% which means they turn 50% of their input energy into electricity. Their efficiency also is good in a partial load in comparison with gas turbines. Gas engines are also good for frequent stops and starts which is not the case in crypto farms as the mining devices are expected to work constantly. Engines also have liquid fuel flexibility which is good especially for places that don’t have access to the natural gas pipeline or resources. In general, the CAPEX for a gas engine is lower than a gas turbine in the same amount of power generation capacity however their maintenance costs or OPEX for them sometimes is higher than a gas turbine. A rule of thumb is for small power projects (less than 5MW) it makes more sense to have an engine than a turbine for power generation. As engines turn most of the input energy to power, the exhaust gas temperature of the engine doesn’t have much heat to recover especially for projects that a high temperature of heat recovery is needed.

Higher electricity efficiency even in part load
Lower CAPEX
Fuel flexibility
Low exhaust temperatures
Good for Crypto farms if no external cooling is required

Gas turbine generator set

Gas turbines can be started within minutes and ramed up and down very quickly which makes them fit with the applications that we need to meet sudden peak loads. They have a lower electrical efficiency (less than 40%) and their efficiency is dropping dramatically in the partial load. They are designed for continuous operation and often combined with steam turbines to improve the total efficiency by using the exhaust heat of gas turbines. The temperature of gas turbine exhaust is very high and therefore still there is a lot of energy available for recovery. This recovery typically is done by heat recovery steam generators HRSGs in the power plant to create high-pressure steam for running steam turbines in combined power plants CPPs or combined heat and power systems CHPs. However, the cost of the combined power plant is very high and it seems that it’s not a feasible solution for crypto farms. Nevertheless, the recovered heat of gas turbine exhaust gas can be used for creating cooling load in absorption chillers in combined cooling, heating, and power systems CCHPs which make projects more feasible for crypto farms if they need external cooling sources. Gas turbines typically generate more smooth electricity with lower fluctuation which is good for crypto rigs as they are more sensitive to the input power voltage fluctuations. As mentioned one of the main drawbacks of using a gas turbine is its high CAPEX however by using a refurbished or used gas turbine investors may be able to handle that downside. The operation and maintenance of gas turbines are more complicated than the engines so it is highly recommended that crypto investors either go into a long-term service contract with gas turbine manufacturers or find the right and professional gas turbine service provider to handle that part for them.