Judge nixes DEC denial of Greenidge permit renewal

Greenidge Generation Holdings Inc. and the environmental groups that oppose its Finger Lakes power plant used for bitcoin mining both claimed victory Thursday in the wake of a state Supreme Court judge’s ruling.

“Transparent political bias lost today,” Greenidge said in a statement. “Local employees will not have their careers ripped away by politically motivated governmental overreach that had no basis in law from the first day it began.”

But Lisa Perfetto, a senior attorney in the Clean Energy Program at Earthjustice, said “today’s ruling confirms what we’ve known all along: that the DEC has the statutory authority under New York’s climate law to deny Greenidge the air permit that allows it to power its cryptomine.”

The lawsuit, filed Aug. 15 by Greenidge against the state Department of Environmental Conservation, is the most recent development in a multiyear battle between Greenidge and state environmental regulators. The DEC had ordered the company to shut down the Greenidge Generating Station in the town of Torrey, Yates County, on the western shore of Seneca Lake.

The court granted Earthjustice’s motion to intervene on behalf of Seneca Lake Guardian, Committee to Preserve the Finger Lakes, and Sierra Club. 

The Torrey facility, which dates to the 1930s, ceased operating as a coal-fired plant roughly a decade ago. Since 2014, it has been operated by Greenidge; it began using the plant for bitcoin mining five years ago.

Several DEC permits are required for operations at the facility. The current dispute began in June 2022, when Greenidge’s application for renewal of its air permit—which expired in September 2021—was denied by the agency. The company filed an appeal.

On May 8, DEC Regional Director Dereth Glance issued a final decision, writing that “it is beyond dispute that granting the renewal permit … is inconsistent with or will interfere with the attainment of the statewide greenhouse gas limits.” Greenidge challenged the decision, citing “numerous errors of law and fact.”

Greenidge uses what’s known as proof-of-work cryptocurrency mining. Environmental and citizen groups maintain it poses a range of hazards to the environment and is damaging to the Finger Lakes region’s multibillion-dollar agritourism economy.

The DEC’s 2022 ruling declared that the natural gas-fired facility’s continued operations would be “inconsistent with the statewide greenhouse gas emission limits” established in the 2019 Climate Leadership and Community Protection Act. The 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.

“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,” the DEC ruling stated. “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.”

A Greenidge statement issued in response was sharply critical the DEC decision, calling it “arbitrary and capricious.”

In its suit against the DEC and Acting Commissioner Sean Mahar, Greenidge argued that the department improperly interpreted the Climate Act as “authorizing unlimited agency discretion to deny any permit, including a renewal permit application for a long-standing, existing electric generating facility.” The company also maintained the DEC “grossly exceeded its own jurisdiction.”

In his decision, state Supreme Court Justice Vincent Dinolfo ruled that the DEC had the authority to deny Greenidge’s renewal application, “but in utilizing that authority in its Final Denial, acted in a manner that was both affected by errors of law and arbitrary and capricious.” He annulled the DEC’s May 8 denial and sent it back to the agency for further proceedings.

Greenidge, the facility’s parent company, also has cryptocurrency facilities in Mississippi, North Dakota and South Carolina. For the nine months ended Sept. 30, the company reported a net loss of $15.9 million on revenues of $44.7 million. In the same period a year earlier, it lost $32.52 million on revenues of $50.7 million.

Greenidge stock, which trades on the Nasdaq Global Select Market under the ticker symbol GREE, closed Thursday at $2.47 a share versus a 52-week high of $9.26. In late 2021, its share price topped $1,500.

In its most recent quarterly report, filed a week ago with the Securities and Exchange Commission, Greenidge repeated a previous warning to investors that court proceedings related to the DEC’s denial of its air permit renewal application “may take a number of years to fully resolve, and there can be no assurance that our efforts will be successful.”

In its statement released after Dinolfo’s ruling, the company took a much more aggressive line.

“The Climate Act is a good and well-intended law,” Greenidge said, “but it did not give DEC political appointees and bureaucrats the power to rewrite a statute and unilaterally decide for themselves the value of working-class New Yorkers’ jobs. … The damage caused to our company and employees by the recklessness of the DEC and all those who lied about our operation is real, and today the Court set the record straight—we were right, and the state and its allies were wrong.”

Greenidge’s foes were not backing down.

“For years, Greenidge has been polluting local air and spewing climate-warming greenhouse gasses into the atmosphere,” said Yvonne Taylor, vice president of Seneca Lake Guardian, in a statement. “It’s absurd that Greenidge is still operating, and we will keep fighting until the facility is shut down.”

Paul Ericson is Rochester Beacon executive editor. The Beacon welcomes comments and letters from readers who adhere to our comment policy including use of their full, real name. See “Leave a Reply” below to discuss on this post. Comments of a general nature may be submitted to the Letters page by emailing  [email protected]. 

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