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solex
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April 07, 2014, 06:41:11 PM
Last edit: April 07, 2014, 06:56:39 PM by solex
 #21

As the Bitcoin fx rate climbs the incentive to push the envelope in chip design is ever stronger. A SHA-256 hashing circuit is far simpler than a general purpose CPU. Hopefully, Bitcoin mining will be at the forefront of reversible gate technology in a few years making the whole mining network orders of magnitude more energy efficient.

The mining network of Bitcoin - and of all "proof of work" cryptos for that matter - can not be made "efficient".

At current price ($450) the difficulty should stabilize itself at of near 700 billions. (Hashrate 500 PH/s with 1 J/GH miners and electricity at $0.15/kWh).

Start selling ASICs 10 times more efficient and the difficulty will just jump to thousands of billions.

Low power devices will be run with sustainable electricity sources, such as solar cells, making the whole concern about energy consumption an academic debate.


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April 07, 2014, 07:57:10 PM
 #22

As a dane, let me just say that I am insanely jealous of the cheap electricity everyone else has. It's at $0.45 here.

Look inside yourself, and you will see that you are the bubble.
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April 07, 2014, 08:26:08 PM
Last edit: April 08, 2014, 01:08:02 AM by solex
 #23

What exactly is the incentive that will drive miners into using unreliable and expensive sources of electricity like solars cells rather than inexpensive and always available sources like coal or nuclear ?

Price.
Obviously today is as it is now, with a lot of scope for improvement. Looking some years down the road my point is that RLG tech is incredibly efficient because it recycles electricity within the circuit needing only a negligible top-up. While fossil and nuclear prices continue to rise there will be a crossing point where renewable energy sources will out-compete conventional sources.  I think for ASICs this is <10 years away.


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April 07, 2014, 08:39:47 PM
Last edit: April 07, 2014, 09:26:37 PM by Ibian
 #24

Out of curiosity, how much energy does your typical ASIC need? I'm planning to plop down a few windmills on the boat I'm buying soon, and it might be fun to have one running entirely on wind. Just as a proof of concept and bragging rights if nothing else.

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April 09, 2014, 11:15:14 AM
 #25

Cooling is important factor. You do not only need to produce something. You also need to make sure machine won't overheat.

Interesting part is, even though we usually use electricity for it, there are other solutions.
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June 27, 2014, 10:04:47 PM
 #26

As the Bitcoin fx rate climbs the incentive to push the envelope in chip design is ever stronger. A SHA-256 hashing circuit is far simpler than a general purpose CPU. Hopefully, Bitcoin mining will be at the forefront of reversible gate technology in a few years making the whole mining network orders of magnitude more energy efficient.

The mining network of Bitcoin - and of all "proof of work" cryptos for that matter - can not be made "efficient".

At current price ($450) the difficulty should stabilize itself at of near 700 billions. (Hashrate 500 PH/s with 1 J/GH miners and electricity at $0.15/kWh).

Start selling ASICs 10 times more efficient and the difficulty will just jump to thousands of billions.

Low power devices will be run with sustainable electricity sources, such as solar cells, making the whole concern about energy consumption a moot debate.

What exactly is the incentive that will drive miners into using unreliable and expensive sources of electricity like solars cells rather than inexpensive and always available sources like coal or nuclear ?
The "startup" costs of these energy types are very high. As a result one would need to invest a lot of money in order to build a coal or a nuclear plant. It also takes many years to build these types of plants verses a week (possibly) to order, receive and setup a solar panel
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June 28, 2014, 10:54:49 PM
Last edit: June 28, 2014, 11:18:02 PM by antirack
 #27

Is it really that unlikely that a serious mining operation would run their farm from wind or hydro?

Considering what the mining devices and the infrastructure for it costs, it is not completely impossible in my opinion.

Total cost today (farm deployed):

~$820/TH = $820,000/PH
~$1370/kW = $1,370,000/MW

Annual electricity at $0.88 million at $0.10/kWh _without_ conversion cost, cooling, etc.

The costs for a utility scale wind turbine in 2012 range from about $1.3 million to $2.2 million per MW of nameplate capacity installed. This cost has come down dramatically from what it was just a few years ago.
...
Most of the commercial-scale turbines installed today are 2 MW in size and cost roughly $3-$4 million installed.

At $1.3 million for 1MW at the lower end, it would take less than 2 years to  pay back.

http://www.windustry.org/resources/how-much-do-wind-turbines-cost

If a mining operation takes business serious (= not cowboy style get rich quick mining), it could probably use local resource and government incentives to drive down costs. And after all, if the mining ever stops, the society benefits from all the new wind farms.

(admittedly, I don't know anything about setting up a wind turbine)
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June 29, 2014, 11:37:01 AM
 #28

Ok, so now you got me curious.

Here's a wind map for the US:
http://hint.fm/wind/

http://www.bneenergy.com/bne-energy-faqs.html

Wind farms are built in places with strong, steady winds to ensure that they produce as much power as possible, as much of the time as possible.  However, wind is variable depending on the time of day and time of the year.  A typical wind farm would produce electricity in the range of 25-40% of its rated capacity over the course of the year, but can produce electricity at full capacity on any given day when the wind exceeds a certain threshold amount.

So the obvious answer, build your wind turbine AND your bitcoin mine where it's windy Wink

Profit from both, Bitcoins and electricity sales.
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June 29, 2014, 12:33:26 PM
 #29

antirack:  You forgot to answer this question:

Now if you have 1000 (BTC, k€, whatever) and a possibility to get ASICs delivered to you, what will be your optimal allocation of capital ?
- 100% on ASICs and 0% of wind turbine (you will pay electricity from the grid)
- 50% on ASICs and 50% on wind turbine (you will pay the maintenance of the turbine + you will pay electricity when there is no wind)
- 0% on ASICs and 100% on wind turbine (you are now a green electricity producer, congrats).

This same question applies to solar pannels.

This same question applies to a combination of wind turbine and solar pannels.


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June 29, 2014, 12:41:03 PM
 #30

antirack:  You forgot to answer this question:

Now if you have 1000 (BTC, k€, whatever) and a possibility to get ASICs delivered to you, what will be your optimal allocation of capital ?
- 100% on ASICs and 0% of wind turbine (you will pay electricity from the grid)
- 50% on ASICs and 50% on wind turbine (you will pay the maintenance of the turbine + you will pay electricity when there is no wind)
- 0% on ASICs and 100% on wind turbine (you are now a green electricity producer, congrats).

This same question applies to solar pannels.

This same question applies to a combination of wind turbine and solar pannels.



I did not forget. My answer was:

So the obvious answer, build your wind turbine AND your bitcoin mine where it's windy Wink
Profit from both, Bitcoins and electricity sales.

So 50% on ASICS and 50% on wind turbine if both would be equal priced ($1,37MM/MW for the mine vs. 1.3MM/MW for the wind turbine).

The big question is where to find the highest mountain with the strongest wind and how to overclock the wind turbine.

 Grin
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June 29, 2014, 12:53:27 PM
 #31

No, you are wrong, you did not run the numbers.  To maximize your overall profit (assuming you can get immediate delivery of the latest miners) is to put 100% of your money into miners and forget the whole wind or solar energy production idea.  Any other mix of investing in miners/wind/solar will reduce your overall profit.

This is because wind and solar are the most expensive ways to make electricity whereas burning dirt (coal) is the cheapest.

Our family was terrorized by Homeland Security.  Read all about it here:  http://www.jmwagner.com/ and http://www.burtw.com/  Any donations to help us recover from the $300,000 in legal fees and forced donations to the Federal Asset Forfeiture slush fund are greatly appreciated!
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June 29, 2014, 01:27:22 PM
Last edit: June 29, 2014, 01:45:06 PM by antirack
 #32

No, you are wrong, you did not run the numbers.  To maximize your overall profit (assuming you can get immediate delivery of the latest miners) is to put 100% of your money into miners and forget the whole wind or solar energy production idea.  Any other mix of investing in miners/wind/solar will reduce your overall profit.

This is because wind and solar are the most expensive ways to make electricity whereas burning dirt (coal) is the cheapest.

Is that a theory or a fact?

The theoretical 1MW mine above costs $0.88 million at $0.10/kWh per year on electricity cost.

The theoretical wind turbine costs $1.3 million.

It produces theoretical free power after 1.48 years, when it paid itself back.

After that my theoretical mine mines for free.

For a while.

For every single hardware generation I deploy.

Until it breaks down.

If I would be in my home country, where electricity costs close to $0.30/kWh, we have very high mountains AND a lot of wind, how long would it take to pay the wind turbine back and mine for free? A few months.

There is something fishy about these numbers? Double or triple them, it still takes less than a year.

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June 29, 2014, 04:06:04 PM
 #33

No, you are wrong, you did not run the numbers.  To maximize your overall profit (assuming you can get immediate delivery of the latest miners) is to put 100% of your money into miners and forget the whole wind or solar energy production idea.  Any other mix of investing in miners/wind/solar will reduce your overall profit.

This is because wind and solar are the most expensive ways to make electricity whereas burning dirt (coal) is the cheapest.

Is that a theory or a fact?

The theoretical 1MW mine above costs $0.88 million at $0.10/kWh per year on electricity cost.

The theoretical wind turbine costs $1.3 million.

It produces theoretical free power after 1.48 years, when it paid itself back.

After that my theoretical mine mines for free.

For a while.

For every single hardware generation I deploy.

Until it breaks down.

If I would be in my home country, where electricity costs close to $0.30/kWh, we have very high mountains AND a lot of wind, how long would it take to pay the wind turbine back and mine for free? A few months.

There is something fishy about these numbers? Double or triple them, it still takes less than a year.


I think that wind turbine will need to receive some kind of maintenance and upkeep every so often.

You also forgot to include the fact that you need to put the turbine on land that you own/control. You would (in most countries) need to pay property taxes on both the land and the turbine. You would also have a lost opportunity cost as if you did not have the turbine on your property then you could have rented your land to someone and received some kind of rent.

This spot for rent.
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June 30, 2014, 12:24:45 AM
 #34

You might be right about that.

Found some other info in the meantime:

http://www.forbes.com/sites/christopherhelman/2012/12/21/why-its-the-end-of-the-line-for-wind-power/

According to the federal Energy Information Administration, the “levelized cost” of new wind power (including capital and operating costs) is 8.2 cents per kWh. Advanced clean-coal plants cost about 11 cents per kWh, the same as nuclear. But advanced natural gas-burning plants come in at just 6.3 cents per kWh.

And that is probably for large scale corporate installations by the energy producers, not some single miner with his own land. No word about hydro though.

Back to square one.

Hydro power available at places like Washington State is $0.02/kWh to $0.03/kWh.

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June 30, 2014, 12:46:56 AM
 #35

I know that the wholesale price of electricity for Xcel Energy in Colorado is less than $0.03/kWh because at the end of each year they have to pay me wholesale price for my yearly solar overproduction (I get dollar for dollar credit for my yearly consumption that is covered by my production).  That low price is due to all the electricity they import from older dirty coal burning generation facilities in Wyoming.

Old, dirty coal plants produce cheap electricity.  Natual gas is very cheap now due to the fracking of gas wells so gas powered plants also produce very cheap electricity.  Hydro can be cheap.  Everything else is more.

I now a guy with a huge commercial BTC mining warehouse that pays less than $0.02/kWh because he buys power in huge steady quantities.  That is the only way to make money in the mining game long term.

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June 30, 2014, 05:17:37 AM
 #36

The cheapest type energy by far is nuclear power. It is also one of the cleanest forms of energy.

I really do not understand why the "green lobby" does not push nuclear power more

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June 30, 2014, 04:50:42 PM
 #37

The big question is where to find the highest mountain with the strongest wind and how to overclock the wind turbine.

 Grin


I don't know where you live, but at least in the US, the Dakotas would be a great place for wind.  I've read articles before describing them the "Saudi Arabia of wind" and that they have enough wind that if enough wind turbines were built there, they could generate enough power not just for that area, but to power the entire country.  The catch, of course, for the rest of the country is that there still aren't a ton of people in the Dakotas, excluding the boom of population that's happening now because of the oil boom.

But if you move there and plan on setting one up, I hope you like cold weather.  It gets REAL cold there.

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June 30, 2014, 06:33:19 PM
 #38

The big question is where to find the highest mountain with the strongest wind and how to overclock the wind turbine.

 Grin


I don't know where you live, but at least in the US, the Dakotas would be a great place for wind.  I've read articles before describing them the "Saudi Arabia of wind" and that they have enough wind that if enough wind turbines were built there, they could generate enough power not just for that area, but to power the entire country.  The catch, of course, for the rest of the country is that there still aren't a ton of people in the Dakotas, excluding the boom of population that's happening now because of the oil boom.

But if you move there and plan on setting one up, I hope you like cold weather.  It gets REAL cold there.
Cold weather is great for mining.  Free cooling.

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June 30, 2014, 07:07:01 PM
 #39

The cheapest type energy by far is nuclear power. It is also one of the cleanest forms of energy.

I really do not understand why the "green lobby" does not push nuclear power more

Probably just ignorance mostly. Lots of people have irrational fears of things they don't understand and associate with death instead of cleaner and more efficient energy.
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June 30, 2014, 07:16:57 PM
 #40

The cheapest type energy by far is nuclear power. It is also one of the cleanest forms of energy.

I really do not understand why the "green lobby" does not push nuclear power more

Probably just ignorance mostly. Lots of people have irrational fears of things they don't understand and associate with death instead of cleaner and more efficient energy.
I really like what I have read about Thorium reactors.  Seems like the way to go.  If the whole industry was not funded by the need for Plutonium then I think there would be a lot more reseach into things like Thorium reactors.  If you have not read about them check it out.

Our family was terrorized by Homeland Security.  Read all about it here:  http://www.jmwagner.com/ and http://www.burtw.com/  Any donations to help us recover from the $300,000 in legal fees and forced donations to the Federal Asset Forfeiture slush fund are greatly appreciated!
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