Exclusive: SAN reporter's inquiry into Texas' Bitcoin mines triggers lawsuit

Texas has become this hub for cryptocurrency activity, but the public's in the dark on the

details. That's because the Public Utility Commission of Texas is trying to block journalists

and the public from learning specifics about these larger mining facilities, including how much power they pull from the grid. The reason they cite terrorism

Straight Air News Energy reporter Keaton Peters is among the journalists who requested information

about these Bitcoin mines, things like locations, owners, and consumption. This is all information

the Public Utility Commission has, because state law requires crypto facilities with a certain

electrical load to register with them. When the Public Utility Commission first fought releasing

this information, the state of Texas largely sided with the journalists. Assistant Attorney General

Blake Brennan wrote, we find you have failed to demonstrate the information at issue identifies

technical details of particular vulnerabilities of critical infrastructure to an act of terrorism

Therefore, he ruled they may not withhold the information. The next step, the Public Utility Commission is now suing the Attorney General of Texas

Ken Paxton. The lawsuit says, in the wrong hands, this information could be used by terrorists to

plan attacks on Texas's energy grid and critical infrastructure. The commission says public safety

She is at risk and the attorney general should rectify his ruling

When my first impression was this sounds like it's being written by the Bitcoin mining industry

not an entity that's supposed to be operating on behalf of the Texas public

Jackie Sawicki used to live south of Dallas near where a large Bitcoin mining company was setting up shop

She has a specific point of view on this. She was behind the Texas coalition against crypto mining

Those Bitcoin miners are in these you know shipping containers with fans that are blowing on them and because of Texas heat gets really hot So these fans are really loud They louder at night when it off peak hours and energy is cheaper They go even harder And so up to 10 miles away people can hear this noise

People like Sawicki want more information about these mines, but could that release make Texas

a target for terrorists? I want to bring in San Energy reporter Keaton Peters now. Keaton

I just want to start this off. Why did you request this information? What is the public interest here

Yeah, thanks, Simone. And the reason why I went ahead and I requested this information started because I was reporting on cryptocurrency mines around Texas and how electricity demand is also set to surge

the electric grid in Texas is going to maybe double by 2030. And we don't really know how

much of that new demand is cryptocurrency mining, because, well, we don't actually know how much of

current demand is cryptocurrency mining. A lot of these Bitcoin mines are, as Jackie Sawicki was

saying, you know, set up shop in communities around the state. Sometimes that leads to controversy

So a lot of members of the public want to know how many crypto mines are there out there

Like, what is the impact that this is really going to have on the grid? Because that question has been subject to a lot of controversy in the last couple of years

And I just wanted to get data that could help provide clearer answers

Well, without knowing the number of locations, how much energy they're pulling at this point, what do we know about how cryptocurrency mining affects the grid

So ERCOT, the grid operator in Texas, classifies large crypto mines as a large flexible load

What that means is that the grid operator can actually control some of how much electricity

these mines are using if those crypto mines opt in to say okay we using a bunch of electricity but you the grid operator can turn our demand down when that electricity is needed elsewhere So the crypto mining industry really points to

this as a way that they actually strengthen the grid. They say that they're incentivizing

more generation to come online, and then when it's needed elsewhere, they can go ahead and

pull back and not consume as much energy, which creates a buffer. But this isn't really clear cut

There are other experts who study the electrical grid who describe this as more of a parasitic

relationship where crypto mines are setting up shop and they'll use electricity, they'll kind of

push prices up for everyone, and then they'll also ask to get paid in order to turn their demand down

in those moments of crisis. We do know last year, one of the ERCOT vice presidents said that

there's about as much crypto mining already on the grid as the energy needs of the city of Austin

But that was more of an estimate, and we haven't had any updated figures since then

Yeah. Let's talk now about this terrorism defense that the Public Utility Commission is citing

What are the risks that they're saying could happen if we knew the locations of these places, who owns them and how much energy they're pulling

Yeah, that's one where it's tough to know exactly, because as the attorney general's ruling stated, the Public Utility Commission did not provide enough detail into what their reasoning is as to why this could create a terrorism threat

I reached out to the grid operator and did not get a straight answer as to whether they classify Bitcoin mines as critical infrastructure and whether there been any credible threats against those facilities in the past I also asked Riot Platforms and Marathon Digital Holdings

as well as some of the other big Bitcoin mining companies that are active in Texas

and they all declined to comment as well. So it's hard for me to say exactly what any real threat

of terrorism might be here because, yeah, there simply aren't clear answers that are being given

to the public. The only thing that, you know, I will say is that they're hooked up to the electrical

grid. And some of the experts I talked to who study how the grid works have said that these

large loads are becoming increasingly important to how demand and supply are kept in balance

So it is something that is important for making sure the grid is reliable

Just the fact that they participate in these programs where ERCOT can turn down how much electricity they're using

Is this type of information, if we were to say we're seeking the same information about a power plant, would that be concealed from the public for the same reason

We can find out where power plants are, who owns them, and what their capacity is to add power to the electric grid. So it was pointed out by a few of my sources that that information on power plants is readily available. So they did think it was strange that for cryptocurrency mines, it's not being made available

Well, Keaton Peters, I know that you're going to stay on top of this. You have an investment

in seeing whether they will release this information. And for anyone who wants to read your full

story, they can search Texas cryptocurrency at sand.com or on the sand app. Keaton, thank you