Economics, energy, and my articles are apolitical. Regardless of where you fall in the political spectrum, left or right, you need energy to power your devices. Whether you’re liberal or conservative, you use money from the economy for fuel or electricity to power your car. My articles are not for everyone but they are designed to appeal to a wide range of people. The world is increasingly polarised to the extent that we cannot respect one another’s differences. Rather than feed into what divides us, I prefer to build bridges to unify perspectives. When we can see eye to eye, less time is spent arguing, and more time can be dedicated to resolving issues important to all parties. Problems such as energy security and climate change.

Global warming is not selective of a political party, race, or religion, it affects everyone. Indeed, the type of energy we use either accelerates or slows down climate change. The current narrative is fossil fuels are the problem and renewable energy is the solution but it's not that simple. How do we ensure that the Earth’s population today has enough power and the environment is in good condition for future generations? The answer to this question is ‘Just Transition’. Global, regional, and national economies are not sturdy enough to switch energy sources in one go. It must be done in stages when the renewable sector is stable. Otherwise, it would leave many people who work in coal mines, oil rigs, etc, without a sustainable alternative to depend on for their livelihood.

You may be wondering if I’m qualified to discuss these topics in depth. I have a Master's degree in Climate Change and made a discovery during my Thesis (research project) that increases the accuracy of temperature analysis. My finding is citable here and due to be published in the ‘Climate of the Past Journal’ of the European Geosciences Union (EGU). A major challenge that we all face is managing the time we have to mitigate climate change and wasted energy.

We waste a ludicrous amount of energy, 50,000 TWh (terawatt hours) — 31% of the total 160,000 TWh in the global economy. An environmentalist like me, endorsing an infamous energy costly cryptocurrency does raise a few eyebrows. I want to clarify if the unsustainable narrative attributed to Bitcoin is true and enable others to do the same. Thereby affirming if Bitcoin is a friend or foe, of the environment that we need to protect for our survival.

Just-Transition and Energy Security

Just transition is a scheme comprised of social interventions required to maintain workers’ rights and livelihoods as the world switches to a greener economy to tackle climate change. Global emissions have been rising for decades but so has energy poverty and economic inflation. It can happen anywhere in both developed and developing countries. Energy poverty and an inflating economy can make populations energy insecure. This occurs when people struggle to afford utilities (electricity and gas) or find it difficult to fuel their cars.

In densely populated areas like suburbs and cities, public transport is a suitable alternative (when it’s of a good standard). Although, rural areas have subpar transport options. Rural populations depend on reliable transport like driving cars to get around. They are the first group to be significantly affected when petrol, diesel, and coal increase in price. The growth in price is a result of scarcity.

Over the last month, we’ve discusssed the nature of supply and demand. Russia supplies ~40% of Europe’s oil and natural gas. Tensions between Russia and Europe decreases the supply. The amount of people that need fuel hasn’t changed much but the amount of fuel available has dropped notably. The energy supply shock increases the price due to high demand.

Europe’s dependence on Russian energy has been a talking point for years. It gave Russia too much power and Europe’s NATO allies, the US, weren’t happy about this. Russia is the world’s third-largest oil producer so everyone does business with them, yes even the US. Due to recent developments in Eastern Europe, the EU has constructed a framework to wean Europe off Russian energy by 2027, three years earlier than expected. Just-Transition and renewable energy can enable Europe to recover its energy independence.

Renewable energy can be considered decentralised energy. Fossil fuels can be characterised as centraslised energy. Russian energy is centralised and they have complete authority over it. No one can turn the sun and wind on or off, this decentralised energy belongs to everyone. Divesting into renewables properly can have profound effects on energy security, global peace, and livelihoods. Regions can sustain their sovereignty and leverage when the majority of energy is not controlled by a single authority.

The Energy Costs of Bitcoin and Other Industries

Bitcoin (BTC) can be an ally of the environment if it produces fewer carbon emissions than its counterparts. Conversely, BTC generating more carbon emissions than other industries make it an enemy of the environment. Note how I’m measuring BTC’s carbon dioxide (CO2) emissions, not its energy consumption. It’s a common misconception that they are the same thing. The types of energy used have more impact on the environment than the amount of energy used. Being carbon neutral is when the carbon produced is offset by the carbon stored making net emissions 0.

Let's say driving a diesel car is +3 CO2 and driving an electric car is +1 CO2. The electric car produces less carbon but the type of electricity used to top up fuel is important. If wind-powered electricity is used to top up the electric car, that is -1 CO2 as no carbon was produced to generate that electricity, and carbon was saved instead. The electric car powered by renewables is carbon neutral (+1–1=0) and no new carbon was added to the ozone. That’s not possible with diesel or petrol (combustion engine) cars, they just add more CO2 to the atmosphere.

Bitcoin does use a large amount of energy, an average 143 TWh (terrawatt hours). That exceeds the 124 TWh Norway consumes. What often goes over peoples heads, is 75% of Bitcoin mining uses renewable energy. Its the cheapest option for BTC miners. Meaning Bitcoin adds less CO2 to the atmosphere in two places, at energy generation and consumption. This preserves Earth’s depleting ozone layer. The ozone is essential for preventing damaging ultraviolet (UV) light from the sun reaching Earth’s surface.

The majority of the world’s wasted energy is sustainable energy which makes it cheap. Bitcoin miners opt for cheap renewable power sources to compensate for other costs. Renewable energy is wasted because winter is when energy demand peaks but wind, solar, and hydro energy production is high during the summer. Our batteries aren’t eco-friendly or efficient enough to store energy for long periods either. Most other economic practices like banking, gold mining, and data centers rely on the consistency of fossil fuel energy but that is starting to change. Nonetheless, Bitcoin is miles ahead by virtue of being decentralised.

The composition of BTC allows the hash power (miners and equipment) to spread all over the world. A downturn of hash rate in one location is picked up elsewhere. China has banned Bitcoin mining a few times and on each occasion, the hash power migrated. Russia was one site that rebooted BTC’s hash rate. Iceland, Sweden and Norway were other new places for BTC mining due to cold weather as well as a surplus of geothermal, hydro and solar energy. Yet, statisticians and researchers didn’t think to apply context to Bitcoins energy consumption.

Irrespective of whether you consider Bitcoin useful or useless, it consumes minuscule energy on a global scale. BTC uses only 0.1% of the world’s generated energy and 0.4% of the world’s wasted energy due to its high renewable energy mix. Bitcoin’s counterparts are the global financial system, gold mining industry, and data centers which all consume much more energy and have less sustainable energy sources. The paramount issue is not Bitcoin’s energy consumption but reducing energy waste then improving the renewable energy mix of other industries.

(My) Conclusion

I thought the lead argument for Bitcoin mining was how its environmental impact paled in comparison to other sectors. I’ve realised that there are more layers to the debate. Now we know that 56–75% of BTC’s energy consumption comes from the 50,000 Twh of wasted energy. This wasted energy stems from the surplus of renewable energy produced off-peak when demand is low and can’t be completely used. Bitcoin drives the profitability and appeal of cheap sustainable energy. Bitcoin’s energy mix is an example for other industries to follow in the global transition from fossil fuels to renewable sources as we try to mitigate energy waste and climate change.

I approached this article like a Mythbuster, debunking false narratives and allowing my audience to make their decision. You may have decided that Bitcoin still isn’t for you. I’m a man of my word and I said my articles are for a wide range of people so don’t worry I’ve got you covered too. Bitcoin and Ethereum (ETH) are Proof of Work blockchains, mining for a number which is a calculation of a total number of transactions, and once completed a block is minted. It’s energy-intensive to produce just 1 BTC or ETH. Coins that aren’t Bitcoin are called altcoins (or alts). Ethereum is an altcoin updating to a Proof of Stake protocol but it isn’t there yet. Proof of Stake alts consume less energy but remember it's not the amount of energy that counts but the types of energy used.

Cardano (ADA) and Binance Coin (BNB) both operate using Pro