North Vancouver To Be World’s First City Heated By Bitcoin

As the price of bitcoin rises, bitcoin’s hashrate is also rising. Mining computers around the world are humming away and at the same time are producing amounts of waste in the form of excess heat that is unprecedented.

Enterprising miners like Burnaby-based MintGreen, a Canadian cleantech bitcoin miner, is already leading the waste reuse space with their heat sales to a local brewery and a sea salt distillery.

Other miners are using excess heat to power greenhouse operations (growing flowers and vegetables), home heating, and jacuzzis.

Now MintGreen is getting into industrial sales with a 12-year contract to provide heat with their new “Digital Boilers” (which recover more than 96% of the electricity used for mining) to North Vancouver’s district energy system to heat commercial and residential buildings.

For MintGreen, heat recovery projects are a win-win as they get to reuse the initial hydro, for mining and for sale.

City of North Vancouver, BC

Located in the hills north of Vancouver, the City of North Vancouver uses a hydronic district energy system for heating that delivers heat to 100 residential and commercial buildings.

North Vancouver City council has taken the issue of climate change to heart and has set its own emissions reduction goals. According to their release:

“In 2019, the City of North Vancouver Council passed a motion for the City to increase its greenhouse gas reduction targets to achieve net zero by 2050, and reduce emissions by 80% below 2007 levels by 2040.”

Over the term of their contract with the city, MintGreen’s Digital Boilers will prevent 20,000 tonnes of GHGs from entering the atmosphere per MW compared to natural gas.

“The complex issue of climate change requires innovative solutions, and LEC, with the City of North Vancouver, is showing tremendous leadership in environmental stewardship.” said MintGreen CEO, Colin Sullivan in an announcement today.

Lonsdale Energy Corporation Steps Into The Future

The Lonsdale Energy Corporation (LEC) is owned by the city and has been providing energy here since 2003. LEC is working with the city to find ways to reduce its carbon footprint or decarbonize.

“The LEC is on a decarbonization journey to implement more renewable and clean energy, transitioning from the use of conventional natural gas,” says the announcement released today.

The city currently uses a mix of energy sources according to the website:

“LEC presently uses a combination of high efficiency natural gas boilers, ground source heat pumps, heat recovery from building cooling, and solar thermal panels to heat hot water.”

“LEC is continually exploring ways to use waste heat from buildings and industrial processes located adjacent to the district energy system, and switching to alternative and renewable fuels. LEC will transition to using zero emissions energy sources as soon as it becomes economical to do so. This move is already underway in Central Lonsdale where LEC’s mini-plant is powered by solar energy.”

In the announcement today, LEC CEO Karsten Veng said;

“Being partners with MintGreen on this project is very exciting for LEC, in that it’s an innovative and cost competitive project, and it reinforces the journey LEC is on to support the City’s ambitious greenhouse gas reduction targets.”

Veng hopes that the MintGreen Digital Boiler pilot project could be the launchpad for future expansion opportunities as the City of North Vancouver continues to grow.

“Today’s announcement also mentioned the federal government’s proposed $170 per tonne carbon tax coming into effect in 2029 which will drive up the cost of natural gas, another reason to cut carbon.

In an interview with Bitcoin Magazine, Sullivan told us that there isn’t any way that bitcoin mining could be greener.

Over 97% of BC Hydro’s energy mix is hydroelectric. Using that energy twice both eliminates waste and makes this project one of the greenest in the space, he explained.

Mining with hydro already makes MintGreen green and reusing that same energy to sell heat makes it that much more eco-friendly.

Samson Mow, CSO for Blockstream Inc who is acting as a special advisor to the MintGreen team, told us:

“MintGreen’s new innovation is a perfect example of how mining bitcoin can be the greenest use of energy on the planet” 


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Why Aren’t More Bitcoin Miners Setting Up Shop In Canada?

Canada seems to offer many of the advantages for successful bitcoin mining — lots of stranded renewable energy (mostly hydro), a cooler climate (which is easier on equipment) and a lower fiat currency value (more competitive than the U.S. dollar).

But even with China losing more than 20% of its hash rate in recent weeks because of forced regulatory shutdowns, and with the U.S. rate climbing to 17%, the Cambridge Center for Alternative Finance estimates that Canada’s current share of the world’s Bitcoin network is only 3%.

Malaysia, Kazakhstan, Iran and Russia are all mining at a higher hash rate than Canada.

So, what is keeping bitcoin miners out of Canada?

The Cost Of Energy In Canada Is Prohibitive To Bitcoin Miners

Compass Mining, a full-service mining host and equipment provider, recently released an in-depth mining report that included a look at mining in Canada and concluded that energy should be inexpensive there — but that a problem lies with the regulatory environment. In addition, the report noted that the Canadian government is developing a carbon tax that will likely raise the cost of energy.

Demonstrating this problem, Colin Sullivan, CEO of British Columbia-based MintGreen, explained that energy prices in that province are relatively high because local energy provider BC Hydro is a crown corporation and doesn’t have the same commercial pressures as a private provider.

“I wouldn’t describe energy prices as globally competitive,” Sullivan told Bitcoin Magazine. “In my conversations with Chinese miners, they’re looking for energy costs around $50 per megawatt hour.”

For his business in particular, that concern has not been a deal breaker for operating in Canada, though many other bitcoin mining operations would likely not see it this way.

“MintGreen is less interested in power prices because we create heat markets with our miners,” Sullivan added. “Selling heat from our digital boilers allows us to be much more competitive irrespective of energy price. This and green grid power makes British Columbia an excellent fit for us.”

The World Bank publishes an “Ease Of Doing Business” ranking, which includes a measure of the availability of electricity. Its data gives Canada a low score for its availability of power sources, ranking it 124 out of 190 countries for ease of accessing electricity. (The U.S. ranks 64.)

Citadel256, a Canadian startup with founding partners who are Canadian entrepreneurs, is helping miners from China relocate to Texas and the U.S. Midwest, because this lack of energy availability prohibits it from recommending its home country.

“We’d like to recommend Canada, but the problem here is not so much the cost of energy itself but the logistics of accessing energy markets,” Citadel256 cofounder and mining consultant Magdalena Gronowska told Bitcoin Magazine. “Energy is abundant in Canada but it’s not cheap to access. The cost of energy infrastructure — generation, transmission and distribution — is spread across and recovered from the rate base.”

“Canada has a large landmass and infrastructure investments are recovered over a smaller population base than the U.S., so it’s generally more expensive,” she added.

Canada’s Regulatory Environment Pushes Bitcoin Miners Elsewhere

Compass Mining’s report maintains that Canada’s regulatory environment is the main problem for mining companies noting that ”the high level of bureaucracy in the country has hindered the growth and scalability of Bitcoin mining,” and that “there is a lack of clarity regarding how cryptocurrency assets should be treated. Each Canadian province having its own securities regulator further complicates matters.”

The report cited the case of Blockstream mining, which has farms in Quebec and in the U.S. state of Georgia. Going forward, Blockstream has chosen to expand in Georgia as it finds Quebec’s regulatory environment too difficult to navigate.

Gronowska agrees with Compass Mining that the Canadian regulatory environment is a challenge.

“Regulatory burden and red tape can also add costs and timeline uncertainty to a facility build out, which adds risk to any mining project,” she noted. “Canada has stringent environmental and safety regulations. For example, carbon is increasingly becoming a cost center and factor into long-term operational decisions. Electrical equipment that meets our standards may result in longer lead times.”

Compass concluded that it is the country’s confusing and unclear regulatory environment that causes mining companies to go elsewhere.

“A myriad of regulatory bodies increases the risk that miners can be subject to changes that unfavorably impact their businesses,” per the report. “Provincial, federal and municipal governments may also introduce changes that adversely affect mining operations.”

Gronowska agrees that there tends to be a bias against business in Canada and that fragmented regulations and multiple regulatory bodies impose additional challenges for bitcoin miners.

“Miners seek the path of least resistance and favor more business-friendly jurisdictions outside Canada,” she said.

Canada Does Have Some Advantages For Bitcoin Miners

Still, some bitcoin mining operations, like MintGreen, have been able to find niches that make Canada the perfect home for them. The province of Alberta is the most business-friendly jurisdiction in the country, and companies like Upstream Data have been able to thrive off of the grid using gas flaring from oil production.

And on another positive note, bitcoin mining companies wanting to list on Canada’s stock exchange are likely to be more successful there than they would be in the U.S.

“Stock exchanges with less stringent listing requirements, like the Toronto Venture Stock Exchange (TSXV), have resulted in a diverse collection of cryptocurrency companies trading on the public markets in Canada,” Compass Mining reported. “The risk profile of Canadian companies is generally higher compared to their U.S. counterparts.”


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Bitcoin mine heat-recycling firm MintGreen closes seed round led by CoinShares

Sustainable crypto mining firm MintGreen has completed its seed investment round, with top digital asset manager CoinShares leading the round.

A portion of the funds will likely be used to support two pilot projects intended to showcase how MintGreen’s proprietary technology can improve the energy efficiency of Bitcoin mining.

MintGreen has two pilot projects slated to commence next quarter. The first involves selling heat waste generated from Bitcoin mining to the Vancouver Island Sea Salt facility, where the heat being used to boil water and distil salt flakes.

Heat waste will also be repurposed by Canadian whiskey company, Shelter Point Distillery, in their production process.

A March 17 announcement from CoinShares notes the firms will work together to recycle heat waste from crypto mining into hot water and heating services — which will be sold to industrial clients.

The companies hope their efforts can change mainstream perceptions of Bitcoin mining as being wasteful and inefficient, with the blog post stating:

“We are excited to work with MintGreen, where we will join the board, and the like-minded investors we brought into this deal alongside us to help transform the Bitcoin mining landscape and its image in the mainstream media.”

MintGreen is a Canadian-based firm that builds and operates immersive Bitcoin mining systems with clean sourced energy.

Bitcoin has long struggled to overcome perceptions of being highly energy inefficient, with mainstream frequently comparing the energy expenditure of the mining sector to entire countries.

Last month, the BBC reported that Bitcoin mining is more energy intensive than the entire country of Argentina, with Cambridge University’s Michel Rauchs stating:

“It is really by design that Bitcoin consumes that much electricity. This is not something that will change in the future unless the Bitcoin price is going to significantly go down.”

However, mainstream analysis often overlooks the fact that most Bitcoin mines are powered by renewable energy that would otherwise go to waste, Cambridge University’s 3rd Global Cryptoasset Benchmarking Study revealed more than three-quarters of miners use renewable energy sources.