It is nothing but a redundancy to say that Bitcoin mining is power-intensive and creates huge deficits of energy in regions where miners build massive farms.

Texas was chosen by many large mining groups as a good place to set up their rigs, but cold winters revealed that the state’s energy grid was not ready for the loads that it experienced.

ERCOT (Electric Reliability Council of Texas) believes that BTC miners create pressure on the grid that the state cannot “power through”.

Meeting in the middle

The compromise can be found in the LFL program. The abbreviation stands for Large Flexible Loads meaning that miners will be offered discounts and other business benefits if they abstain from using power during intense periods when the demand is high and the capacity of the energy grid is stretched thin.

ERCOT hopes that Bitcoin miners will feel that incentives are good enough to manage power consumption in accordance with the state’s needs.

LFL should be able to solve many issues that the state is facing right now. Bitcoin miners also have a good incentive to mine irregularly as mining became quite expensive and even forced some large operators to forfeit some of their BTC market positions just to cover expenses associated with running a massive mining farm 24/7.

Participating in LFL can be the best way for both parties to save costs and avoid disruptions of the energy grid in a state that has been hit the most by intense weather conditions.

The program is expected to launch on January 1, 2023. Note that LFL allows ERCOT to ask participants to turn their machinery on and off on demand.

The currently used program is called demand-response and allows miners to get credits for electricity in exchange for powering down during periods of intense load on the grid.

Bitcoin miners are still facing criticism

Some US senators including Elizabeth Warren are not on board with the idea of allowing miners to work in the US at all considering how this business affects other electricity users. Hopefully, LFL will demonstrate that these issues are manageable.