Major Bitcoin miners have established a presence at a disused aluminum smelting factory in Rockdale. Two Bitcoin mining behemoths are fighting over inexpensive power in a little hamlet in Texas.
Both Bitdeer, a mining company split out from Chinese behemoth Bitmain, and Riot Blockchain, one of the largest publicly listed Bitcoin mining companies in the United States, operate data centers at the old Rockdale aluminum smelting plant.
The town’s aluminum smelting factory was once the biggest in the world, until its operator, Alcoa, ceased operations in 2008. According to Lee Bratcher, president of the Texas Blockchain Council, the facility’s energy potential was squandered from the time Alcoa left until the miners arrived.
Despite being a small rural town of only 5,600 residents, Rockdale possesses all of the characteristics desired by industrial-scale miners — crypto-friendly politicians, large plots of land with abandoned industrial infrastructure ripe for repurposing, and dirt-cheap electricity prices courtesy of Texas’ deregulated market.
Mayor John King of Rockdale views the partnership between the local grid operator, the Electric Reliability Council of Texas (ERCOT), and miners as advantageous to both parties. He underlined that miners often use energy that would otherwise be squandered, and they may also immediately halt operations if power is required elsewhere. He continued:
“Miners agree to purchase a set quantity of electricity and then resell it at the market to earn a profit. They have a contract for two or three cents per kilowatt-hour…and may sell it for $9 per kilowatt-hour.”
The business currently believes that the Rockdale plant is generating more than 500 BTC per month. The mined coins are worth $30 million per month at current pricing. According to Riot, the location is home to 100,000 mining machines.
Texas politicians are attempting to expand the state’s support of Bitcoin mining, with Senator Ted Cruz presenting mining as a way to absorb natural gas that the state now fires.
Cruz said during the Oct. 10 Texas Blockchain Summit that natural gas is now being flared in West Texas because “there is no transmission infrastructure to deliver that natural gas to where it might be utilized normally.”
“Utilize the processing power to mine Bitcoin. The beauty of that is that by doing so, you immediately benefit the environment by putting natural gas to productive use rather than flaring it,” he said.
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