$100M Cryptocurrency Data Center in Colorado Is Met with Controversy

A planned cryptocurrency data center in Colorado is being criticized because it will potentially violate local renewable energy goals. The center is expected to cost some $100M.

AX2 Data Centers is constructing a new data center in Pueblo, Colorado, expected to be finished by the end of 2019. However, the idea is coming under fire from locals for not matching sustainable energy standards. The company reached a deal with the state exchanging energy subsidies with a promise to create jobs. Last year, the state passed a law that allowed companies to have discounted electricity if they promised to create “economic development.”

Local energy provider Black Hills Energy says that the new data center is expected to add 50MW. The proposed center could be a setback for clean energy plans, especially if Black Hills cannot handle the demands with renewables.

According to a member of Pueblo’s Energy Future, David Cockrell, “fifty more megawatts of this largely coal-fired power will essentially wipe out the gains in a renewable generation.”

The data center will largely be used for cryptocurrency mining, but has been called “dirty” for its waste. Pueblo’s Energy Future plans to transform the city towards 100% renewables by 2035, but the new center could put a dent in these plans.

However, the data center will be used for much more than cryptocurrency mining. The efficiency planned means that the company will be able to install three to four times the number of servers compared to most centers. They will be used for various computationally-heavy applications from blockchain to AI to gaming. At this time, the plan will employ some 40 employees.

Cryptocurrency mining has long been subject to criticism due to its energy consumption. Although there is evidence to suggest that much of cryptocurrency mining comes from renewables, oftentimes there are no standards. Much of cryptocurrency mining is still done in China which largely relies on fossil fuels.

It remains to be seen whether the planned data center in Pueblo will end up coming to fruition. AX2 Data Centers, however, can expect to receive significant pushback from the public.

Do you believe that cryptocurrency data centers are not energy-efficient? Let us know your thoughts below.


Images courtesy of Shutterstock.

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