ASIC Space Heaters will Lower Breakeven Mining Cost to Under 3.8c / kwh

[Seth Otterstad]

Math:
ASIC rigs currently cost between $1.50 and $10 per Watt.  Once the bitcoin price and hashrate stabilizes and ASIC companies' profit margins are driven down, a miner of average network efficiency is likely to cost only $1/W

If a household buys a 1000W bitcoin miner as a heater for a good sized room, using a miner of average network efficiency, it will cost them $1000 (or ~$40 for a normal electric space heater).

To pay this off in 3 years, the miner must earn $333/year

$333 / (8760kwh/year) = 3.8c/kwh

Conclusion:  
Miners who don't need any of the heat generated by their equipment will eventually be losing money if they pay over 3.8c/kwh, as long as average hardware converges to under $1 per watt, because they will be undercut by people who already need to run electric heaters.  The ASIC heater business appears to have a bright future.

Questions:  

How widespread is electric heating vs gas worldwide?  
I found one article saying it was cheaper to use electric in Lithuania.  Certainly in the US, natural gas is always cheaper due to huge recent discoveries, so the US will be left out of the ASIC heater market.

Is it true that the miner/heater only has to compete with electric resistance heating in cold areas of the world?  It is my understanding that heat pumps do not work when the outside temperature is under 40F.

The ASIC heater has to be on 24/7 for this math to work, so are there are many places in the world where heat is needed 24/7?

Other threads on heating with mining:
https://bitcointalk.org/index.php?topic=36429.20
https://bitcointalk.org/index.php?topic=134085.0

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[freedomno1]

Liquid cooling of the space heaters is the future
https://docs.google.com/document/d/1foqSvwX5elsVGG4VkowchCOLBBq7uxwe2qAkX_ltGPE/

But that said I guess rigs would make good warmers if you can still heat a room even while using immersion cooling that would be impressive


And to answer your question we use coal to power our electricity plants and natural gas to warm buildings

[HellDiverUK]

I remember everyone having electric radiator heating in london a couple years ago, so it must be cheaper than gas there. 

I think you were high.  Only places I see with electric heating in the UK are apartments or rented accomodation.  Anyone who pays their own bills has gas.

Over here in N. Ireland, only three of the biggest cities have gas, and our electric is expensive, so most people burn kerosene.  Which is 60p a litre.  Which for most people is a home heating bill of £1200-1800 a year. 

[Seth Otterstad]

Perhaps I am not remembering London correctly, but you have seen some apartments in the UK with electric heating?  It doesn't need to be very common for ASIC heaters to have a market.

This article says a guy in Lithuania turned off his central heating and installed an electric heater because it was cheaper, so clearly there are some areas where this is the case.  Their gas prices have increased 450% in the last seven years.  Could this be why Ukraine and Belarus have such a disproportionate amount of mining going on?
http://worldnews.nbcnews.com/_news/2013/02/04/16837470-heat-or-food-lithuanians-feel-russias-cold-shoulder-as-gas-prices-rise

[philipma1957]

Math:
ASIC rigs currently cost between $1.50 and $10 per Watt.  Once the bitcoin price and hashrate stabilizes and ASIC companies' profit margins are driven down, a miner of average network efficiency is likely to cost only $1/W

If a household buys a 1000W bitcoin miner as a heater for a good sized room, using a miner of average network efficiency, it will cost them $1000 (or ~$40 for a normal electric space heater).

To pay this off in 3 years, the miner must earn $333/year

$333 / (8760kwh/year) = 3.8c/kwh

Conclusion:  
Miners who don't need any of the heat generated by their equipment will eventually be losing money if they pay over 3.8c/kwh, as long as average hardware converges to under $1 per watt, because they will be undercut by people who already need to run electric heaters.  The ASIC heater business appears to have a bright future.

Questions:  

How widespread is electric heating vs gas worldwide?  
I found one article saying it was cheaper to use electric in Lithuania.  Certainly in the US, natural gas is always cheaper due to huge recent discoveries, so the US will be left out of the ASIC heater market.

Is it true that the miner/heater only has to compete with electric resistance heating in cold areas of the world?  It is my understanding that heat pumps do not work when the outside temperature is under 40F.

The ASIC heater has to be on 24/7 for this math to work, so are there are many places in the world where heat is needed 24/7?

Other threads on heating with mining:
https://bitcointalk.org/index.php?topic=36429.20
https://bitcointalk.org/index.php?topic=134085.0

In many USA states  homes are heated by electricity .   Tennessee has  decent power rates and many homes only have electric heat.   So from Nov to Apr.  Maybe 6 months. Maybe 5 months.   Any of these homes can fully heat the home with a few asic mining setups.




the setup above is in my attached garage.  It burns 500 watts and it hashes at about 42gh.   that is 11.5 watts a gh.  but in a home with electric heat only and there are more then 1 million such homes in the USA it is great.  

you need to spend the money on electric power to heat the home.  so this would be 12 k watt a day  or 360 k watt a month.