Water an issue for some renewable projects

BC Utilities Commission Site C Dam Questions press BC Hydro on geotechnical risks, stability issues, cost overruns, oversight gaps, seeking transparency for ratepayers and clarity on contracts, mitigation, and the powerhouse and spillway foundations.

Key Points

Inquiry seeking explanations from BC Hydro on geotechnical risks, costs, timelines and oversight for Site C.

✅ Timeline of studies, monitoring, and mitigation actions

✅ Rationale for contracts, costs, and right bank construction

✅ Implications for ratepayers, oversight, and project stability

The watchdog B.C. Utilities Commission has sent BC Hydro 70 questions about the troubled Site C dam, asking when geotechnical risks were first identified and when the project’s assurance board was first made aware of potential issues related to the dam’s stability. 

“I think they’ve come to the conclusion — but they don’t say it — that there’s been a cover-up by BC Hydro and by the government of British Columbia,” former BC Hydro CEO Marc Eliesen told The Narwhal. 

On Oct. 21, The Narwhal reported that two top B.C. civil servants, including the senior bureaucrat who prepares Site C dam documents for cabinet, knew in May 2019 that the project faced serious geotechnical problems due to its “weak foundation” and the stability of the dam was “a significant risk.” 

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“They [the civil servants] would have reported to their ministers and to the government in general,” said Eliesen, who is among 18 prominent Canadians calling for a halt to Site C work until an independent team of experts can determine if the geotechnical problems can be resolved and at what cost.  

“It’s disingenuous for Premier [John] Horgan to try to suggest, ‘Well, I just found out about it recently.’ If that’s the case, he should fire the public servants who are representing the province.” 

The public only found out about significant issues with the Site C dam at the end of July, when BC Hydro released overdue reports saying the project faces unknown cost overruns, schedule delays and, even as it achieved a transmission line milestone earlier, such profound geotechnical troubles that its overall health is classified as ‘red,’ meaning it is in serious trouble. 

“The geotechnical challenges have been there all these years.”

The Site C dam is the largest publicly funded infrastructure project in B.C.’s history. If completed, it will flood 128 kilometres of the Peace River and its tributaries, forcing families from their homes and destroying Indigenous gravesites, hundreds of protected archeological sites, some of Canada’s best farmland and habitat for more than 100 species vulnerable to extinction.

Eliesen said geotechnical risks were a key reason BC Hydro’s board of directors rejected the project in the early 1990s, when he was at the helm of BC Hydro.

“The geotechnical challenges have been there all these years,” said Eliesen, who is also the former Chair and CEO of Ontario Hydro, where Ontario First Nations have urged intervention on a critical electricity line, the former Chair of Manitoba Hydro and the former Chair and CEO of the Manitoba Energy Authority.

Elsewhere, a Manitoba Hydro line to Minnesota has faced potential delays, highlighting broader grid planning challenges.

The B.C. Utilities Commission is an independent watchdog that makes sure ratepayers — including BC Hydro customers — receive safe and reliable energy services, as utilities adapt to climate change risks, “at fair rates.”

The commission’s questions to BC Hydro include 14 about the “foundational enhancements” BC Hydro now says are necessary to shore up the Site C dam, powerhouse and spillways. 

The commission is asking BC Hydro to provide a timeline and overview of all geotechnical engineering studies and monitoring activities for the powerhouse, spillway and dam core areas, and to explain what specific risk management and mitigation practices were put into effect once risks were identified.

The commission also wants to know why construction activities continued on the right bank of the Peace River, where the powerhouse would be located, “after geotechnical risks materialized.” 

It’s asking if geotechnical risks played a role in BC Hydro’s decision in March “to suspend or not resume work” on any components of the generating station and spillways.

The commission also wants BC Hydro to provide an itemized breakdown of a $690 million increase in the main civil works contract — held by Spain’s Acciona S.A. and the South Korean multinational conglomerate Samsung C&T Corp. — and to explain the rationale for awarding a no-bid contract to an unnamed First Nation and if other parties were made aware of that contract. 

Peace River Jewels of the Peace Site C The Narwhal
Islands in the Peace River, known as the ‘jewels of the Peace’ will be destroyed for fill for the Site C dam or will be submerged underwater by the dam’s reservoir, a loss that opponents are sharing with northerners in community discussions. Photo: Byron Dueck

B.C. Utilities Commission chair and CEO David Morton said it’s not the first time the commission has requested additional information after receiving BC Hydro’s quarterly progress reports on the Site C dam. 

“Our staff reads them to make sure they understand them and if there’s anything in then that’s not clear we go then we do go through this, we call it the IR — information request — process,” Morton said in an interview.

“There are things reported in here that we felt required a little more clarity, and we needed a little more understanding of them, so that’s why we asked the questions.”

The questions were sent to BC Hydro on Oct. 23, the day before the provincial election, but Morton said the commission is extraordinarily busy this year and that’s just a coincidence. 

“Our resources are fairly strained. It would have been nice if it could have been done faster, it would be nice if everything could be done faster.” 

“These questions are not politically motivated,” Morton said. “They’re not political questions. There’s no reason not to issue them when they’re ready.”

The commission has asked BC Hydro to respond by Nov. 19.

Read more: Top B.C. government officials knew Site C dam was in serious trouble over a year ago: FOI docs

Morton said the independent commission’s jurisdiction is limited because the B.C. government removed it from oversight of the project. 

The commission, which would normally determine if a large dam like the Site C project is in the public’s financial interest, first examined BC Hydro’s proposal to build the dam in the early 1980s.

After almost two years of hearings, including testimony under oath, the commission concluded B.C. did not need the electricity. It found the Site C dam would have negative social and environmental impacts and said geothermal power should be investigated to meet future energy needs. 

The project was revived in 2010 by the BC Liberal government, which touted energy from the Site C dam as a potential source of electricity for California and a way to supply B.C.’s future LNG industry with cheap power.

Not willing to countenance another rejection from the utilities commission, the government changed the law, stripping the commission of oversight for the project. The NDP government, which came to power in 2017, chose not to restore that oversight.

“The approval of the project was exempt from our oversight,” Morton said. “We can’t come along and say ‘there’s something we don’t like about what you’re doing, we’re going to stop construction.’ We’re not in that position and that’s not the focus of these questions.” 

But the commission still retains oversight for the cost of construction once the project is complete, Morton said. 

“The cost of construction has to be recovered in [hydro] rates. That means BC Hydro will need our approval to recover their construction cost in rates, and those are not insignificant amounts, more than $10.7 billion, in all likelihood.” 

In order to recover the cost from ratepayers, the commission needs to be satisfied BC Hydro didn’t spend more money than necessary on the project, Morton said. 

“As you can imagine, that’s not a straight forward review to do after the fact, after a 10-year construction project or whatever it ends up being … so we’re using these quarterly reports as an opportunity to try to stay on top of it and to flag any areas where we think there may be areas we need to look into in the future.”

The price tag for the Site C dam was $10.7 billion before BC Hydro’s announcement at the end of July — a leap from $6.6 billion when the project was first announced in 2010 and $8.8 billion when construction began in 2015. 

Eliesen said the utilities commission should have been asking tough questions about the Site C dam far earlier. 

“They’ve been remiss in their due diligence activities … They should have been quicker in raising questions with BC Hydro, rather than allowing BC Hydro to be exceptionally late in submitting their reports.” 

BC Hydro is late in filing another Site C quarterly report, covering the period from April 1 to June 30. 

The quarterly reports provide the B.C. public with rare glimpses of a project that international hydro expert Harvey Elwin described as being more secretive than any hydro project he has encountered in five decades working on large dams around the world, including in China.

Read more: Site C dam secrecy ‘extraordinary’, international hydro construction expert tells court proceeding

Morton said the commission could have ordered regular reporting for the Site C project if it had its previous oversight capability.

“Then we would have had the ability to follow up and ultimately order any delinquent reports to be filed. In this circumstance, they are being filed voluntarily. They can file it as late as they choose. We don’t have any jurisdiction.” 

In addition to the six dozen questions, the commission has also filed confidential questions with BC Hydro. Morton said confidential information could include things such as competitive bid information. “BC Hydro itself may be under a confidentiality agreement not to disclose it.” 

With oversight, the commission would also have been able to drill down into specific project elements,  Morton said. 

“We would have wanted to ensure that the construction followed what was approved. BC Hydro wouldn’t have the ability to make significant changes to the design and nature of the project as they went along.”

BC Hydro has been criticized for changing the design of the Site C dam to an L-shape, which Eliesen said “has never been done anywhere in the world for an earthen dam.” 

Morton said an empowered commission could have opted to hold a public hearing about the design change and engage its own technical consultants, as it did in 2017 when the new NDP government asked it to conduct a fast-tracked review of the project’s economics. 

Construction Site C Dam
A recent report by a U.S. energy economist found cancelling the Site C dam project would save BC Hydro customers an initial $116 million a year, with increasing savings growing over time. Photo: Garth Lenz / The Narwhal

The commission’s final report found the dam could cost more than $12 billion, that BC Hydro had a historical pattern of overestimating energy demand and that the same amount of energy could be produced by a suite of renewables, including wind and proposed pumped storage such as the Meaford project, for $8.8 billion or less. 

The NDP government, under pressure from construction trade unions, opted to continue the project, refusing to disclose key financial information related to its decision. 

When the geotechnical problems were revealed in July, the government announced the appointment of former deputy finance minister Peter Milburn as a special Site C project advisor who will work with BC Hydro and the Site C project assurance board to examine the project and provide the government with independent advice.

Eliesen said BC Hydro and the B.C. government should never have allowed the recent diversion of the Peace River to take place given the tremendous geotechnical challenges the project faces and its unknown cost and schedule for completion. 

“It’s a disgrace and scandalous,” he said. “You can halt the river diversion, but you’ve got another four or five years left in construction of the dam. What are you going to do about all the cement you’ve poured if you’ve got stability problems?”

He said it’s counter-productive to continue with advice “from the same people who have been wrong, wrong, wrong,” without calling in independent global experts to examine the geotechnical problems. 

“If you stop construction, whether it takes three or six months, that’s the time that’s required in order to give yourself a comfort level. But continuing to do what you’ve been doing is not the right course. You should have to sit back.”

Eliesen said it reminded him of the Pete Seeger song Waist Deep in the Big Muddy, which tells the story of a captain ordering his troops to keep slogging through a river because they will soon be on dry ground. After the captain drowns, the troops turn around.

“It’s a reflection of the fact that if you don’t look at what’s new, you just keep on doing what you’ve been doing in the past and that, unfortunately, is what’s happening here in this province with this project.”

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Mexico Energy Reform Defeat underscores opposition unity as CFE-first rules, state regulators, and lithium nationalization falter amid USMCA concerns, investment risks, and clean energy transition impacts in Congress over power generation policy.

Key Points

The failed push to expand CFE control, flagged for USMCA risks, higher costs, regulator shifts, and slower clean energy transition.

✅ Bill to mandate 54% CFE generation and priority dispatch failed.

✅ Opposition cited USMCA breaches, higher prices, slower clean energy.

✅ Lithium nationalization to return via separate legislation.

Mexican President Andres Manuel Lopez Obrador's plan to increase state control of power generation was defeated in parliament on Sunday, as opposition parties united in the face of a bill they said would hurt investment and breach international obligations, concerns mirrored by rulings such as the Florida court on electricity monopolies that scrutinize market concentration.

His National Regeneration Movement (MORENA) and its allies fell nearly 60 votes short of the two-thirds majority needed in the 500-seat lower house of Congress, mustering just 275 votes after a raucous session that lasted more than 12 hours.

Seeking to roll back previous constitutional reforms that liberalized the electricity market, Lopez Obrador's proposed changes would have done away with a requirement that state-owned Comision Federal de Electricidad (CFE) sell the cheapest electricity first, a move reminiscent of debates when energy groups warned on pricing changes under federal proposals, allowing it to sell its own electricity ahead of other power companies.

Under the bill, the CFE would also have been set to generate a minimum of 54% of the country's total electricity, and energy regulation would have been shifted from independent bodies to state regulators, paralleling concerns raised when a Calgary retailer opposed a market overhaul over regulatory impacts.

The contentious proposals faced much criticism from business groups and the United States, Mexico's top trade partner as well as other allies who argued it would violate the regional trade deal, the United States-Mexico-Canada Agreement (USMCA), even as the USA looks to Canada for green power to deepen cross-border energy ties.

Lopez Obrador had argued the bill would have protected consumers and made the country more energy independent, echoing how Texas weighs market reforms to avoid blackouts to bolster reliability, saying the legislation was vital to his plans to "transform" Mexico.

Although the odds were against his party, he came into the vote seeking to leverage his victory in last weekend's referendum on his leadership.

Speaking ahead of the vote, Jorge Alvarez Maynez, a lawmaker from the opposition Citizens' Movement party, said the proposals, if enacted, would damage Mexico, pointing to experiences like the Texas electricity market bailout after a severe winter storm as cautionary examples.

"There isn't a specialist, academic, environmentalist or activist with a smidgen of doubt - this bill would increase electricity prices, slow the transition to (clean) energy in our country and violate international agreements," he added.

Supporters of clean-energy goals noted that subnational shifts, such as the New Mexico 100% clean electricity bill can illustrate alternative pathways to reform.

The bill also contained a provision to nationalize lithium resources.

Lopez Obrador said this week that if the bill was defeated, he would send another bill to Congress on Monday aiming to have at least the lithium portion of the proposed legislation passed.

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Municipal Renewable Energy Procurement surged as cities contracted 3.7 GW of solar and wind, leveraging green tariffs, community solar, and utility partnerships across the Southeast, led by Houston, RMI, and WRI data.

Key Points

The process by which cities contract solar and wind via utilities or green tariffs to meet climate goals.

✅ 3.7 GW procured in 2020, nearly 25% year-over-year growth

✅ Houston runs city ops on 500 MW solar, a record purchase

✅ Southeast cities use green tariffs and community solar

Cities around the country bought more renewable energy last year than ever before, reflecting how renewables may soon provide one-fourth of U.S. electricity across the grid, with some of the most remarkable projects in the Southeast, according to new data unveiled Thursday.

Even amid the pandemic, about eight dozen municipalities contracted to buy nearly 3.7 gigawatts of mostly solar and wind energy — enough to power more than 800,000 homes. The figure is almost a quarter higher than the year before.

Half of the cites listed as “most noteworthy” in Thursday’s release —  from research groups Rocky Mountain Institute and World Resources Institute — are in the region that stretches from Texas to Washington, D.C. 

Houston stands out for the sheer enormity of its purchase: In July, it began powering city operations entirely from nearly 500 megawatts of solar power — the largest municipal purchase of renewable energy ever in the United States, as renewable electricity surpassed coal nationwide.

The groups also feature smaller deals in North Carolina and Tennessee, achieved through a utility partnership called a green tariff.

“We wanted to recognize that Nashville and Charlotte were really blazing a new trail,” said Stephen Abbott, principal at the Rocky Mountain Institute.

And the nation’s capital shows how renewable energy can be a source of revenue: It’s leasing out its public transit station rooftops for 10 megawatts of community solar.

All of these strategies will be necessary for scores of U.S. cities to meet their ambitious climate goals, researchers believe. An interactive clean energy targets tracker shows all 95 clean energy procurements from the year in detail.

Tracker 
Even before former President Donald Trump promised to remove the United States from the Paris Climate Accord, a lack of federal action on climate left a void that some cities and counties were beginning to fill, as renewables hit a record 28% in a recent month. In 2015, the first year tracked by researchers at the Rocky Mountain Institute and the World Resources Institute, municipalities contracted to buy more than 1 gigawatt of wind, solar and other forms of clean energy. 

But when Trump officially set in motion the withdrawal from the climate agreement, the ranks of municipalities dedicated to 100% clean energy multiplied. Today there are nearly 200 of them. The growth in activity last year reflects, in part, that surge of new pledges.

“It takes a while to get city staff up to speed and understand the options, and create the roadmap and then start executing,” Abbott said. “There is a bit of a lag, but we’re starting to see the impact.”

Even in Houston — one of the earliest to begin procuring renewable energy — there has been a steep learning curve as market forces change and prices drop, including cheaper solar batteries shaping procurement strategies, said Lara Cottingham, Houston’s chief of staff and chief sustainability officer.

No matter how well resourced and educated their staff, cities have to clear a thicket of structural, political and economic challenges to procure renewable energy. Most don’t own their own sources of power. Nearly all face budget constraints. Few have enough land or government rooftops to meet their goals within city limits.

“Cities face a situation where it’s a square peg in a round hole,” Cottingham said.

The hurdles are especially steep in much of the Southeast, where only publicly regulated utilities can sell electricity to retail customers, even large ones such as major cities. That’s where a green tariff regime comes in: Cities can purchase clean energy from a third party, such as a solar company, using the utility as a go-between.

Early last year, Charlotte became the largest city to use such a program, partnering with Duke Energy and two North Carolina solar developers to build a solar farm 50 miles north in Iredell County. At first, the city will pay a premium for the energy, but in the latter half of the 20-year contract, as gas prices rise, it will save money compared to business as usual.

“Over the course of 20 years, it’s projected we would save about $2 million,” Katie Riddle, sustainability analyst with Charlotte, told the Energy News Network last year.

The growing size of projects, innovative partnerships like green tariff programs, and the improving economics all give Abbott hope that renewable energy investments from cities will only grow — even with the Trump presidency over and the country back in the Paris agreement.

And when cities meet their goals for procuring renewable energy for their own operations, they must then turn to an even bigger task: reducing the carbon footprint of every person in their jurisdiction with broader decarbonization strategies and community engagement.

“The city needs to do its part for sure,” said Houston’s Cottingham. “Then we have this challenge of how do we get everyone else to.”

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Bitcoin Energy Debate examines electricity usage, mining costs, environmental impact, and blockchain efficiency, weighing renewable power, carbon footprint, scalability, and transaction throughput to clarify stakeholder claims from Tesla, Square, academics, and policymakers.

Key Points

Debate on Bitcoin mining's power use, environmental impact, efficiency, and scalability versus alternative blockchains.

✅ Compares energy intensity with transaction throughput and system outputs.

✅ Weighs renewables, stranded power, and carbon footprint in mining.

✅ Assesses PoS blockchains, stablecoins, and scalability tradeoffs.

There is a great debate underway about the electricity required to process Bitcoin transactions. The debate is significant, the stakes are high, the views are diverse, and there are smart people on both sides. Bitcoin generates a lot of emotion, thereby producing too much heat and not enough light. In this post, I explain the importance of identifying the key issues in the debate, and of understanding the nature and extent of disagreement about how much electrical energy Bitcoin consumes.

Consider the background against which the debate is taking place. Because of its unstable price, Bitcoin cannot serve as a global mainstream medium of exchange. The instability is apparent. On January 1, 2021, Bitcoin’s dollar price was just over $29,000. Its price rose above $63,000 in mid-April, and then fell below $35,000, where it has traded recently. Now the financial media is asking whether we are about to experience another “cyber winter” as the prices of cryptocurrencies continue their dramatic declines.

Central banks warns of bubble on bitcoins as it skyrockets
As bitcoins skyrocket to more than $12 000 for one BTC, many central banks as ECB or US Federal ... [+] NURPHOTO VIA GETTY IMAGES
Bitcoin is a high sentiment beta asset, and unless that changes, Bitcoin cannot serve as a global mainstream medium of exchange. Being a high sentiment beta asset means that Bitcoin’s market price is driven much more by investor psychology than by underlying fundamentals.

As a general matter, high sentiment beta assets are difficult to value and difficult to arbitrage. Bitcoin qualifies in this regard. As a general matter, there is great disagreement among investors about the fair values of high sentiment beta assets. Bitcoin qualifies in this regard.

One major disagreement about Bitcoin involves the very high demand for electrical power associated with Bitcoin transaction processing, an issue that came to light several years ago. In recent months, the issue has surfaced again, in a drama featuring disagreement between two prominent industry leaders, Elon Musk (from Tesla and SpaceX) and Jack Dorsey (from Square).

On one side of the argument, Musk contends that Bitcoin’s great need for electrical power is detrimental to the environment, especially amid disruptions in U.S. coal and nuclear power that increase supply strain.  On the other side, Dorsey argues that Bitcoin’s electricity profile is a benefit to the environment, in part because it provides a reliable customer base for clean electric power. This might make sense, in the absence of other motives for generating clean power; however, it seems to me that there has been a surge in investment in alternative technologies for producing electricity that has nothing to do with cryptocurrency. So I am not sure that the argument is especially strong, but will leave it there. In any event, this is a demand side argument.

A supply side argument favoring Bitcoin is that the processing of Bitcoin transactions, known as “Bitcoin mining,” already uses clean electrical power, power which has already been produced, as in hydroelectric plants at night, but not otherwise consumed in an era of flat electricity demand across mature markets.

Both Musk and Dorsey are serious Bitcoin investors. Earlier this year, Tesla purchased $1.5 billion of Bitcoin, agreed to accept Bitcoin as payment for automobile sales, and then reversed itself. This reversal appears to have pricked an expanding Bitcoin bubble. Square is a digital transaction processing firm, and Bitcoin is part of its long-term strategy.

Consider two big questions at the heart of the digital revolution in finance. First, to what degree will blockchain replace conventional transaction technologies? Second, to what degree will competing blockchain based digital assets, which are more efficient than Bitcoin, overcome Bitcoin’s first mover advantage as the first cryptocurrency?

To gain some insight about possible answers to these questions, and the nature of the issues related to the disagreement between Dorsey and Musk, I emailed a series of academics and/or authors who have expertise in blockchain technology.

David Yermack, a financial economist at New York University, has written and lectured extensively on blockchains. In 2019, Yermack wrote the following: “While Bitcoin and successor cryptocurrencies have grown remarkably, data indicates that many of their users have not tried to participate in the mainstream financial system. Instead they have deliberately avoided it in order to transact in black markets for drugs and other contraband … or evade capital controls in countries such as China.” In this regard, cyber-criminals demanding ransom for locking up their targets information systems often require payment in Bitcoin. Recent examples of cyber-criminal activity are not difficult to find, such as incidents involving Kaseya and Colonial Pipeline.

David Yermack continues: “However, the potential benefits of blockchain for improving data security and solving moral hazard problems throughout the financial system have become widely apparent as cryptocurrencies have grown.” In his recent correspondence with me, he argues that the electrical power issue associated with Bitcoin “mining,” is relatively minor because Bitcoin miners are incentivized to seek out cheap electric power, and patterns shifted as COVID-19 changed U.S. electricity consumption across sectors.

Thomas Philippon, also a financial economist at NYU, has done important work characterizing the impact of technology on the resource requirements of the financial sector. He has argued that historically, the financial sector has comprised about 6-to-7% of the economy on average, with variability over time. Unit costs, as a percentage of assets, have consistently been about 2%, even with technological advances. In respect to Bitcoin, he writes in his correspondence with me that Bitcoin is too energy inefficient to generate net positive social benefits, and that energy crisis pressures on U.S. electricity and fuels complicate the picture, but acknowledges that over time positive benefits might be possible.

Emin Gün Sirer is a computer scientist at Cornell University, whose venture AVA Labs has been developing alternative blockchain technology for the financial sector. In his correspondence with me, he writes that he rejects the argument that Bitcoin will spur investment in renewable energy relative to other stimuli. He also questions the social value of maintaining a fairly centralized ledger largely created by miners that had been in China and are now migrating to other locations such as El Salvador.

Bob Seeman is an engineer, lawyer, and businessman, who has written a book entitled Bitcoin: The Mother of All Scams. In his correspondence with me, he writes that his professional experience with Bitcoin led him to conclude that Bitcoin is nothing more than unlicensed gambling, a point he makes in his book.

David Gautschi is an academic at Fordham University with expertise in global energy. I asked him about studies that compare Bitcoin’s use of energy with that of the U.S. financial sector. In correspondence with me, he cautioned that the issues are complex, and noted that online technology generally consumes a lot of power, with electricity demand during COVID-19 highlighting shifting load profiles.

My question to David Gautschi was prompted by a study undertaken by the cryptocurrency firm Galaxy Digital. This study found that the financial sector together with the gold industry consumes twice as much electrical power as Bitcoin transaction processing. The claim by Galaxy is that Bitcoin’s electrical power needs are “at least two times lower than the total energy consumed by the banking system as well as the gold industry on an annual basis.”

Galaxy’s analysis is detailed and bottom up based. In order to assess the plausibility of its claims, I did a rough top down analysis whose results were roughly consistent with the claims in the Galaxy study. For sake of disclosure, I placed the heuristic calculations I ran in a footnote.1 If we accept the Galaxy numbers, there remains the question of understanding the outputs produced by the electrical consumption associated with both Bitcoin mining and U.S. banks’ production of financial services. I did not see that the Galaxy study addresses the output issue, and it is important.

Consider some quick statistics which relate to the issue of outputs. The total market for global financial services was about $20 trillion in 2020. The number of Bitcoin transactions processed per day was about 330,000 in December 2020, and about 400,000 in January 2021. The corresponding number for Bitcoin’s digital rival Ethereum during this time was about 1.1 million transactions per day. In contrast, the global number of credit card transactions per day in 2018 was about 1 billion.2

Bitcoin Value Falls
LONDON, ENGLAND - NOVEMBER 20: A visual representation of the cryptocurrencies Bitcoin and Ethereum ... [+] GETTY IMAGES
These numbers tell us that Bitcoin transactions comprise a small share, on the order of 0.04%, of global transactions, but use something like a third of the electricity needed for these transactions. That said, the associated costs of processing Bitcoin transactions relate to tying blocks of transactions together in a blockchain, not to the number of transactions. Nevertheless, even if the financial sector does indeed consume twice as much electrical power as Bitcoin, the disparity between Bitcoin and traditional financial technology is striking, and the experience of Texas grid reliability underscores system constraints when it comes to output relative to input.  This, I suggest, weakens the argument that Bitcoin’s electricity demand profile is inconsequential because Bitcoin mining uses slack electricity.

A big question is how much electrical power Bitcoin mining would require, if Bitcoin were to capture a major share of the transactions involved in world commerce. Certainly much more than it does today; but how much more?

Given that Bitcoin is a high sentiment beta asset, there will be a lot of disagreement about the answers to these two questions. Eventually we might get answers.

At the same time, a high sentiment beta asset is ill suited to being a medium of exchange and a store of value. This is why stablecoins have emerged, such as Diem, Tether, USD Coin, and Dai. Increased use of these stable alternatives might prevent Bitcoin from ever achieving a major share of the transactions involved in world commerce.

We shall see what the future brings. Certainly El Salvador’s recent decision to make Bitcoin its legal tender, and to become a leader in Bitcoin mining, is something to watch carefully. Just keep in mind that there is significant downside to experiencing foreign exchange rate volatility. This is why global financial institutions such as the World Bank and IMF do not support El Salvador’s decision; and as I keep saying, Bitcoin is a very high sentiment beta asset.

In the past I suggested that Bitcoin bubble would burst when Bitcoin investors conclude that its associated processing is too energy inefficient. Of course, many Bitcoin investors are passionate devotees, who are vulnerable to the psychological bias known as motivated reasoning. Motivated reasoning-based sentiment, featuring denial,3 can keep a bubble from bursting, or generate a series of bubbles, a pattern we can see from Bitcoin’s history.

I find the argument that Bitcoin is necessary to provide the right incentives for the development of clean alternatives for generating electricity to be interesting, but less than compelling. Are there no other incentives, such as evolving utility trends, or more efficient blockchain technologies? Bitcoin does have a first mover advantage relative to other cryptocurrencies. I just think we need to be concerned about getting locked into an technologically inferior solution because of switching costs.

There is an argument to made that decisions, such as how to use electric power, are made in markets with self-interested agents properly evaluating the tradeoffs. That said, think about why most of the world adopted the Windows operating system in the 1980s over the superior Mac operating system offered by Apple. Yes, we left it to markets to determine the outcome. People did make choices; and it took years for Windows to catch up with the Mac’s operating system.

My experience as a behavioral economist has taught me that the world is far from perfect, to expect to be surprised, and to expect people to make mistakes. We shall see what happens with Bitcoin going forward.

As things stand now, Bitcoin is well suited as an asset for fulfilling some people’s urge to engage in high stakes gambling. Indeed, many people have a strong need to engage in gambling. Last year, per capita expenditure on lottery tickets in Massachusetts was the highest in the U.S. at over $930.

High sentiment beta assets offer lottery-like payoffs. While Bitcoin certainly does a good job of that, it cannot simultaneously serve as an effective medium of exchange and reliable store of value, even setting aside the issue at the heart of the electricity debate.

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Asia Electricity Consumption 2025 highlights an IEA forecast of surging global power demand led by China, lagging access in Africa, rising renewables and nuclear output, stable emissions, and weather-dependent grids needing flexibility and electrification.

Key Points

An IEA forecast that Asia will use half of global power by 2025, led by China, as renewables and nuclear drive supply.

✅ Asia to use half of global electricity; China leads growth

✅ Africa just 3% consumption despite rapid population growth

✅ Renewables, nuclear expand; grids must boost flexibility

Asia will for the first time use half of the world’s electricity by 2025, even as global power demand keeps rising and Africa continues to consume far less than its share of the global population, according to a new forecast released Wednesday by the International Energy Agency.

Much of Asia’s electricity use will be in China, a nation of 1.4 billion people whose China's electricity sector is seeing shifts as its share of global consumption will rise from a quarter in 2015 to a third by the middle of this decade, the Paris-based body said.

“China will be consuming more electricity than the European Union, United States and India combined,” said Keisuke Sadamori, the IEA’s director of energy markets and security.

By contrast, Africa — home to almost a fifth of world’s nearly 8 billion inhabitants — will account for just 3% of global electricity consumption in 2025.

“This and the rapidly growing population mean there is still a massive need for increased electrification in Africa,” said Sadamori.

The IEA’s annual report predicts that low-emissions sources will account for much of the growth in global electricity supply over the coming three years, including nuclear power and renewables such as wind and solar. This will prevent a significant rise in greenhouse gas emissions from the power sector, it said.

Scientists say sharp cuts in all sources of emissions are needed as soon as possible to keep average global temperatures from rising 1.5 degrees Celsius (2.7 Fahrenheit) above pre-industrial levels. That target, laid down in the 2015 Paris climate accord, appears increasingly doubtful as temperatures have already increased by more than 1.1 C since the reference period.

One hope for meeting the goal is a wholesale shift away from fossil fuels such as coal, gas and oil toward low-carbon sources of energy. But while some regions are reducing their use of coal and gas for electricity production, in others, soaring electricity and coal use are increasing, the IEA said.

The 134-page also report warned that surging electricity demand and supply are becoming increasingly weather dependent, a problem it urged policymakers to address.

“In addition to drought in Europe, there were heat waves in India (last year),” said Sadamori. “Similarly, central and eastern China were hit by heatwaves and drought. The United States, where electricity sales projections continue to fall, also saw severe winter storms in December, and all those events put massive strain on the power systems of these regions.”

“As the clean energy transition gathers pace, the impact of weather events on electricity demand will intensify due to the increased electrification of heating, while the share of weather-dependent renewables poised to eclipse coal will continue to grow in the generation mix,” the IEA said. “In such a world, increasing the flexibility of power systems while ensuring security of supply and resilience of networks will be crucial.”

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PLREDA 2019 advances solar, wind, and geothermal on public lands, guiding DOI siting, improving transmission access, streamlining permitting, sharing revenues, and funding conservation to meet climate goals while protecting wildlife and recreation.

Key Points

A bipartisan bill to expand renewables on public lands fund conservation, speed permitting and advance U.S. climate aims.

✅ Targets 25 GW of public-land renewables by 2025

✅ Establishes wildlife conservation and recreation access funds

✅ Streamlines siting, transmission, and equitable revenue sharing

The Senate unveiled its version of a bill the House introduced in July to help the U.S. realize the extraordinary renewable energy potential of our shared public lands.

Senator Martha McSally (R-AZ) and a bipartisan coalition of western Senators introduced a Senate version of draft legislation that will help the Department of the Interior tap the renewable energy potential of our shared public lands. The western Senators represent Arizona, New Mexico, Colorado, Montana, and Idaho.

Elsewhere in the West, lawmakers have moved to modernize Oregon hydropower to streamline licensing, signaling broad regional momentum.

The Public Land Renewable Energy Development Act of 2019 (PLREDA) facilitates siting of solar, wind, and geothermal energy projects on public lands, boosts funding for conservation, and promotes ambitious renewable energy targets that will help the U.S. take action on the climate crisis.

Like the House version, the Senate bill enjoys strong bi-partisan support and industry endorsement. The Senate version makes few notable changes to the bill introduced in July by Representatives Mike Levin (D-CA) and Paul Gosar (R-AZ). It includes:

• A commitment to enhance natural resource conservation and stewardship via the establishment of a fish and wildlife conservation fund that would support conservation and restoration work and other important stewardship activities.
• An ambitious renewable energy production goal for the Department of the Interior to permit a total of 25 gigawatts of renewable energy on public lands by 2025—nearly double the current generating capacity of projects currently on our public lands.
• Establishment of criteria for identifying appropriate areas for renewable energy development using the 2012 Western Solar Plan as a model. Key criteria to be considered include access to transmission lines and likelihood of avoiding or minimizing conflict with wildlife habitat, cultural resources, and other resources and values.
• Improved public access to Federal lands for recreational uses via funds made available for preserving and improving access, including enhancing public access to places that are currently inaccessible or restricted.
• Sharing of revenues raised from renewable energy development on public lands in an equitable manner that benefits local communities near new renewable energy projects and supports the efficient administration of permitting requirements.
• Creating incentives for renewable energy development by giving Interior the authority to reduce rental rates and capacity fees to ensure new renewable energy development remains competitive in the marketplace.

NRDC strongly supports this legislation, and we will do our utmost to facilitate its passage into law. There is no question that in our era of runaway climate change, legislation that balances energy production with environmental conservation and stewardship of our public lands is critical.

PLREDA takes a balanced approach to using our public lands to help lead the U.S. toward a low-carbon future, as states pursue 100% renewable electricity goals nationwide. The bill outlines a commonsense approach for federal agencies to play a meaningful role in combatting climate change.

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