Partnering with the Sierra Club, Finger Lakes activists opposed to the continued operation of a Seneca Lake power plant repurposed for bitcoin mining are asking the Environmental Protection Agency to shut the Seneca Lake plant down.
A lawsuit filed in the federal Western District of New York’s Rochester Division Tuesday by the Seneca Lake Guardian, the Committee to Preserve the Finger Lakes and the Sierra Club comes as bitcoin miner Greenidge Generation may be weighing a bankruptcy filing.
Greenidge stated in a Securities and Exchange Commission filing last month that though it had restructured some $74 million in debt, it still saw bankruptcy as a possibility.
“There remains uncertainty regarding Greenidge’s financial condition and substantial doubt about its ability to continue as a going concern,” the filing states.
The lawsuit brought by the Sierra Club and Finger Lakes activists claims that Greenidge’s bitcoin mining operation, situated in the Yates County village of Dresden, runs afoul of Clean Water Act rules and other federal environmental regulations. The court action comes after months of fencing between Greenidge, environmentalists trying to shutter the firm’s Seneca Lake plant and the state Department of Environmental Conservation.
Greenidge Generation’s president blasted the lawsuit, and the groups that filed it.
“How many times are we going to do this same exact thing? You could have set your watch to the interest groups filing another frivolous legal challenge that in the end is just a PR stunt,” said Dale Irwin, responding to the Beacon’s request for comment. “They’ve lost every single lawsuit they’ve filed over eight years—with five court rulings against them, and zero for them. The result here will follow the same pattern—file a lawsuit, get some media attention and then later lose in court because you have no grounds.”
At issue is a formerly coal-fired power plant retrofitted in 2017 to run on natural gas. Since 2019, Greenidge has operated a bitcoin mining operation at the plant, which also provides electricity to the local energy grid as part of the facility’s public licensing agreement with the state’s power grid operator, NYSIO.
So-called proof-of-work mining of bitcoin and other cryptocurrencies is done by banks of powerful computers that run trillions of computations to solve highly complicated problems that when successfully solved unlock blocks that yield cryptocurrency “coins.”
While they have mostly failed to attain their purpose of serving as a medium of exchange not tied to any government, crypto coins are traded as commodities.
At its peak in 2021, a single bitcoin traded for more than $67,000. As of Jan. 1, 2022, the price had fallen to approximately $47,000. Midweek, bitcoins were trading around $22,500 apiece.
In materials submitted to the state, Greendige has portrayed itself as an economic development engine that would bring lots of jobs to the Finger Lakes region. Critics say the plant’s operations pollute the air, generate greenhouse gases and discharge harmfully warm water into Seneca Lake, upsetting the 600-foot-deep glacially created Finger Lake’s ecological balance.
In a 2021 Rochester Beacon opinion piece, commentator Michael Warren Thomas described the Seneca Lake plant as operating “within a loophole in New York’s environmental regulation the size of a power plant.”
Opponents say the Greenidge plant violates numerous environmental standards. Greenidge maintains the environmental impact of its plant’s operations are minimal.
In June, the DEC turned down Greenidge’s application to renew its Title V Air Permit. Greenidge criticized the agency’s ruling, but said it decision would not affect the plant’s operations because the application was deemed timely and complete, allowing its operations to continue running uninterrupted under its existing Title V permit, “which is still in effect, for as long as it takes to successfully challenge this arbitrary and capricious decision.”
Greenidge’s permit to discharge pollutants into Seneca Lake expired in September 2022 and has not been renewed, the lawsuit states.
The bitcoin mining firm “failed to submit to the New York State Department of Environmental Conservation a sufficient renewal application containing complete, federally required information necessary for a renewal (therefore) the facility is not entitled to continue to discharge under its expired permit,” the court brief argues.
Yvonne Hennessey of Barclay Damon, counsel for Greenidge, rejected that argument. “DEC correctly concluded that Greenidge’s renewal application was timely and sufficient. The mere fact that opponents disagree is beside the point. Indeed, opponents attack Greenidge and assert that the company has done something wrong when in reality they are asking a federal judge to second guess the DEC in matters within its sound discretion.”
“Greenidge is clearly afraid after losing their air permit earlier this year, thanks to the work of Seneca Lake Guardian, Earthjustice, and thousands of supporters in the Finger Lakes and across the state, and now they’re resorting to bullying” said Yvonne Taylor, vice president of Seneca Lake Guardian. “By the way, Greenidge is challenging the DEC’s air permit decision—so we’re not the only ones asking a judge to second guess the DEC in matters within its sound discretion.”
Irwin countered that Greenidge last week “completed a $6 million advanced fish screen system, meeting all state and federal requirements, to protect aquatic life in Seneca Lake. Efforts like this from opponents is why nobody in the Finger Lakes listened to these gadflies anymore; they have zero credibility. We continue to operate under a valid permit, and the latest phony complaint from these perennial litigation losers can’t change that.
“They don’t file lawsuits,” he added, “they issue press releases dressed up as lawsuits and simply waste the courts, and taxpayers, time and money.”
Responded Jill Heaps, senior attorney for Earthjustice, counsel for the environmentalists: “Earthjustice is a national nonprofit environmental law firm, and we stand by our legal filing. We do not litigate our claims in the press, but we look forward to addressing their defenses in federal district court.”
Updated and corrected 1/26/23.
Will Astor is Rochester Beacon senior writer. The Beacon welcomes comments and letters from readers who adhere to our comment policy including use of their full, real name. Submissions to the Letters page should be sent to [email protected].