Finger Lakes cryptomining operation is inconsistent with climate law, state finds

A high-profile converted natural gas plant near Seneca Lake is emitting too much pollution to comply with the state’s new climate law, with the plant’s emissions almost tripling since shifting operations to “burning fossil fuels to power crypto mining,” state Department of Environmental Conservation Commissioner Basil Seggos said.

The jump in emissions was part of the basis for the decision by Gov. Kathy Hochul’s administration to deny a key air permit renewal for the site, Greenidge Generation, on Thursday. “Based on DEC’s review of the specific facts and circumstances presented, this natural gas-fired facility’s continued operations would be inconsistent with the statewide greenhouse gas emission limits established in the Climate Act,” the department said of the former coal plant in a statement.

Greenidge Generation began directing some of its energy to behind-the-meter cryptocurrency mining in 2019. Between 2017 and 2019, the DEC reported, the total greenhouse gas emissions associated with the facility averaged 166,406 tons of carbon dioxide equivalents per year. By 2020, when the CLCPA went into effect, that rose to 415,861 tons per year. “This increase in GHG emissions is primarily due to the fact that Greenidge has substantially altered the primary purpose of the Facility’s operation, from providing electricity to the grid in a ‘peaking’ capacity to powering its own energy-intensive proof-of-work cryptocurrency mining operations behind-the-meter,” the DEC wrote in a letter explaining its decision. 

The decision by the DEC to deny Greenidge its permit renewal marked a major win for environmental groups near the Finger Lakes and around the state who have fought the renewal application for over a year. Those groups are now awaiting a decision by Hochul on whether she will sign a bill recently passed by the state legislature that would place a two-year moratorium on sites similar to Greenidge – natural gas plants powering behind-the-meter proof-of-work crypto mining – from setting up shop in the state. (Existing sites would be able to continue to operate.)

In statements on Thursday afternoon, environmental groups cheered the DEC’s decision to deny Greenidge’s permit renewal, but kept their eyes on the larger goal – getting that moratorium bill signed into law by the governor. “Governor Hochul and the DEC stood with science and the people, and sent a message to outside speculators: New York's former fossil fuel-burning plants are not yours to re-open as gas-guzzling Bitcoin mining cancers on our communities,” Yvonne Taylor, vice president of Seneca Lake Guardian, said in a statement. “Now, it's up to Governor Hochul to finish the job by signing the cryptomining moratorium bill.”

Labor groups who support Greenidge’s presence in the area – and who fought against the moratorium bill – were not so happy. “It is a sad day in New York State, when we can throw away good paying jobs in a hi-tech field,” a spokesperson for the International Brotherhood of Electrical Workers Local 840 said in an emailed statement.

Greenidge, meanwhile, has said that it will continue operations during an “extended judicial review process.” Greenidge is allowed to submit a request for an administrative adjudicatory hearing on the denial within 30 days. “Greenidge made a sincere and substantial offer to take unprecedented actions to further reduce our emissions and make those proposals binding conditions in our renewed permit,” the company said in a press release, adding that the DEC did not engage on that offer. The department said in its decision that those measures were not adequate.

Hochul has been mostly quiet on bitcoin mining – and the environmental concerns about the practice – as the issue has become increasingly heated and prevalent across the state. That relative silence caused some environmental advocates to fear that the administration would allow Greenidge’s permit to be renewed, especially after the deadline for the DEC’s decision on whether to do so was extended multiple times. Most recently, the deadline was extended in March until after the Democratic gubernatorial primary, which took place on Tuesday. Advocates at the time suggested that the delay was politically motivated. The cryptocurrency industry has been enthusiastically lobbying Albany lawmakers this year, and the chief executive of Coinmint, another company with mining operations in New York, donated to Hochul’s campaign. A spokesperson for the DEC said in March that it was solely the department’s decision to extend that deadline in order to review additional material from Greenidge.

As environmental groups await Hochul’s decision on the moratorium legislation, the DEC’s denial of Greenidge’s permit renewal marked an initial victory. “This is a bold move that will protect our natural resources for New Yorkers and particularly important on a day when the Supreme Court has weakened the Environmental Protection Agency’s ability to regulate our power plants,” Assembly Member Anna Kelles, who sponsored the moratorium legislation, said in a statement.