Gridless, a Kenyan bitcoin mining company, recently disclosed how it is assisting local communities in lowering electricity costs by mining bitcoin with surplus power. The Gridless mining model has received praise because it may contribute to the decentralization of bitcoin mining and the transfer of some hashpower to Africa.
Using Wasted Energy to Mine Bitcoin
Bitcoin is now being mined using extra electricity produced by mini-grid hydro generators, according to Kenyan cryptocurrency mining company Gridless. The money made from mining bitcoins aids in lowering or subsidizing the price of electricity.
In a recently released statement, Gridless said that while smaller plants that can produce 100 KW or less have been used up to this point, the company’s long-term goal is to work with plants that can produce 500 KW. The bitcoin mining business said:
We’ve been working with mini-grid hydro generators in Kenya on how to use their excess capacity for Bitcoin mining, which also significantly reduces the cost of power to the local community. Small <100kW sites now, working towards 500kW soon.
In Kenyan villages with power plants installed, communities are only using 10% of the generators’ capacity, according to a Twitter user going by the handle Nick H. This means that the power plants, which are being built to meet the future electricity needs of the respective villages, are currently wasting a significant amount of the energy that is being produced.
Nick H posits that by “plugging in a few bitcoin miners to offtake the excess power,” the respective Kenyan villages can lower their power prices by as much as 90%.
Decentralizing Bitcoin Mining
In the meantime, it’s claimed that the Gridless model, if widely adopted, could potentially see Kenya and the African continent, in general, become an important bitcoin mining hub in addition to assisting with the reduction of respective Kenyan communities’ electricity costs.
“[This business model] contributes to a much-needed decentralization of the current overly centralized mega-site bitcoin mining. In addition to shifting some hashing power to Africa, it also spreads hashing to smaller sites, according to Erik Hersman, one of the founders of Gridless, in a blog post.
On Twitter, many users praised Gridless’ “absolutely incredible” business model and some like Anita from Guatemala asked how this could also be done in her country. In response, Gridless advised those interested in replicating this in their respective countries to find a “partner who likes to build small hydro and then work with them on the model so that it becomes a win/win/win for the power producer/community/miner.”