The battle over cryptocurrency mining in the Finger Lakes took a dramatic turn Thursday when the state Department of Environmental Conservation denied a permit renewal application for the Greenidge Generating Station on the western shore of Seneca Lake.
The denial of the Title V air permit renewal followed a “a comprehensive review of Greenidge’s application and supporting materials, as well as the approximately 4,000 public comments received,” the department said in a statement. “DEC determined the permit renewal application does not demonstrate compliance with the requirements of the Climate Leadership and Community Protection Act.”
Specifically, it said, “this natural gas-fired facility’s continued operations would be inconsistent with the statewide greenhouse gas emission limits established in the Climate Act. Among the factors considered was the dramatic increase in greenhouse gas emissions from the facility since the passage of the Climate Act, driven by the change in the primary purpose of its operations. Rather than solely providing energy to the state’s electricity grid, the power plant now primarily provides energy … to support the demands of Greenidge’s energy-intensive proof of work cryptocurrency mining operations.”
In response, Greenidge Generation Holdings Inc. issued a statement sharply criticizing the DEC decision while noting that it would not curtail operations at the facility.
Greenidge said “this decision does not have any impact on our current operations in Dresden. Because our application was already deemed complete, we operate pursuant to the State Administrative Procedures Act (SAPA). Consistent with the provisions of the SAPA, we can continue running uninterrupted under our existing Title V Air Permit, which is still in effect, for as long as it takes to successfully challenge this arbitrary and capricious decision.”
The Seneca Lake facility, which ceased operating as a coal-fired plant a decade ago, has been owned by private equity firm Atlas Holdings since 2014; it is operated by Greenidge. The facility is subject to several DEC permits; its application for renewal of its air permit expired in September.
Greenidge began using the plant for bitcoin mining in 2019.
Critics say proof-of-work cryptocurrency mining in the Finger Lakes poses a range of environmental hazards and risks harm to the region’s multibillion-dollar agritourism economy. A chief concern is the impact on greenhouse gas emissions.
The 2019 Climate Act requires New York to reduce the release of greenhouse gas 40 percent by 2030 and no less than 85 percent by 2050, based on 1990 levels.
In its statement, Greenidge maintained there is “no credible legal basis whatsoever” for denial of its application “because there is no actual threat to the State’s Climate Leadership and Community Protection Act … from our renewed permit. This is a standard air permit renewal governing emissions levels for a facility operating in full compliance with its existing permit today. It is not, and cannot be transformed into, a politically charged ‘cryptocurrency permit.’”
Further, Greenidge contends, the company 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. On March 25th, we proposed reducing our facility’s permitted GHG emissions by an additional 40% by 2025, five years before the first CLCPA emissions reduction target date in 2030. We also proposed to be a zero-carbon emitting facility by 2035—a full five years before the statewide target for the electric generating sector.”
Since March 25, the company maintains, the DEC failed to work with Greenidge to finalize a permit that would “dramatically reduce GHG emissions and preserve upstate jobs.” Instead, the department “chose to pass up the opportunity to materially improve the environment, choosing instead to burden New York taxpayers with the expense of funding a lengthy administrative and judicial battle that could have easily been avoided.”
Added Greenidge: “Our Dresden facility represents a remarkably insignificant 0.2% of New York’s target GHG emissions level for 2030, and we have already reduced our GHG emissions at the facility by 70% when compared to the reference date of 1990 in the CLCPA. It is absurd for anyone to look at these facts and rationally claim that renewing this specific permit—for a facility that makes up a small fraction of the state’s electricity generation capacity—would impede New York’s long term climate goals. It simply would not. … (W)e are confident that an unbiased court system will reverse this regulatory misjudgment.”
Greenidge has 30 days to request an administrative adjudicatory hearing on the DEC’s denial of its renewal application.
Early this month, the state Legislature approved a measure that would place a two-year moratorium on the issuance or renewal of air quality permits for cryptocurrency mining operations. Gov. Kathy Hochul has not said whether she will sign the legislation.
After lawmakers passed the measure, Greenidge said in a statement that its plant was grandfathered into the bill and “should the legislation be signed into law, our fully permitted power generation and cryptocurrency data center in Dresden … will continue to operate without interruption.”