PRIOR PRINTER'S NOS. 1662, 2129
PRINTER'S NO. 2435
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1476
Session of
2023
INTRODUCED BY VITALI, WAXMAN, MADDEN, SANCHEZ, HILL-EVANS,
STEELE, KHAN, BRENNAN, HOWARD, PIELLI, HOHENSTEIN, SALISBURY,
GREEN AND KRAJEWSKI, JUNE 21, 2023
AS AMENDED ON SECOND CONSIDERATION, HOUSE OF REPRESENTATIVES,
DECEMBER 12, 2023
AN ACT
Providing for reporting requirements for qualifying crypto-asset
mining operations and for an impact study; and imposing
duties on the Department of Environmental Protection.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Short title.
This act shall be known and may be cited as the
Cryptocurrency Energy Conservation Act.
Section 2. Declaration of policy.
The General Assembly finds and declares as follows:
(1) Climate change is the most serious long-term threat
to this planet.
(2) The world needs to reach carbon neutrality by mid-
century to avoid the worst effects of climate change.
(3) This Commonwealth is a major emitter of greenhouse
gases that contribute to climate change, the vast majority of
which, APPROXIMATELY 55%, are related to the production and
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consumption of energy TRANSPORTATION AND INDUSTRIAL SECTORS.
(4) This Commonwealth is committed to reducing
greenhouse gas emissions within the Commonwealth in order to
help combat climate change, with goals of reducing greenhouse
gas emissions by 26% from 2005 levels by 2025 and further
reducing greenhouse gas emissions by 80% from 2005 levels by
2050 under Executive Order 2019-01.
(5) Recently, cryptocurrency mining has expanded greatly
in the United States and this Commonwealth, with several
major cryptocurrency mining operations expected to come
online in this Commonwealth over the next several years.
(6) Cryptocurrency mining refers to the process of
creating new units of cryptocurrency and verifying
transactions by using computers to solve complicated
calculations.
(7) Cryptocurrency mining requires a substantial amount
of energy and currently accounts for as much as 1.7% of
energy consumption in the United States, according to a White
House report.
(8) The cryptocurrency mining industry currently
operates with little governmental oversight or regulation.
(9) The massive use of energy to produce cryptocurrency
is a wasteful use of finite resources.
(10) Unchecked cryptocurrency mining in this
Commonwealth will prevent this Commonwealth from reaching its
stated greenhouse gas emissions reduction goals.
Section 3. Definitions.
The following words and phrases when used in this act shall
have the meanings given to them in this section unless the
context clearly indicates otherwise:
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"Blockchain." A distributed ledger technology in which:
(1) the data are shared across a network that creates a
digital ledger of verified transactions or information among
network participants; and
(2) the data are typically linked using cryptography to
maintain the integrity of the ledger and execute other
functions, including transfer of ownership or value.
"Consensus mechanism." A process to achieve agreement among
network participants on the current state of a blockchain.
"Crypto-asset mining." The process of performing
computations to add a valid block of data to the blockchain
typically in exchange for a reward or fee, including a proof of
work consensus mechanism and excluding those computations
required to validate individual transactions.
"Department." The Department of Environmental Protection of
the Commonwealth.
"Power load." The amount of electrical power, in megawatts,
that is consumed by a qualifying crypto-asset mining operation.
"Qualifying crypto-asset mining operation." The term means:
(1) an individual crypto-asset mining operation located
in this Commonwealth that has a power load that is greater
than or equal to 5 megawatts;
(2) a crypto-asset operation located in this
Commonwealth compromised of more than one location that has a
cumulative power load that is greater than or equal to 5
megawatts; or
(3) a crypto-asset mining operation located at a natural
gas well site in this Commonwealth.
"Scope 1 emissions." Greenhouse gas emissions directly from
sources that are operated, controlled or owned by an individual
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or entity performing a qualifying crypto-asset mining operation.
"Scope 2 emissions." Indirect greenhouse gas emissions
associated with the purchase of electricity, steam, heat or
cooling by an individual or entity performing a qualifying
crypto-asset mining operation.
Section 4. Reporting requirements for qualifying crypto-asset
mining operations.
(a) Reporting.--No later than six months following the
effective date of this subsection, the owner of a qualifying
crypto-asset mining operation in this Commonwealth shall submit
the following information to the department on a form prescribed
by the department:
(1) the number and geographic locations of the
qualifying crypto-asset mining operation;
(2) the number and type of devices engaged in crypto-
asset mining, purchased and retired by the qualifying crypto-
asset mining operation in the past year;
(3) the amount of electric energy consumed by the
qualifying crypto-asset mining operation, including the time
of electricity usage;
(4) the source or sources of electric generation for all
electric energy consumed by the qualifying crypto-asset
mining operation, including the type of fuel used by the
electric generating facility;
(5) scope 1 emissions and scope 2 emissions associated
with electric generation for all electricity consumed by the
qualifying crypto-asset mining operation;
(6) water use associated with cooling crypto-asset
mining devices used by a qualifying crypto-asset mining
operation; and
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(7) any other information deemed necessary by the
department.
(b) Ongoing reporting requirements.--
(1) Prior to starting operations in this Commonwealth, a
qualifying crypto-asset mining operation shall submit the
information required under subsection (a) to the department.
(2) The department shall require a qualifying crypto-
asset mining operation to submit the information under
subsection (a) on an annual basis.
(c) Form.--The department shall prepare a form that includes
all of the information required under subsections (a) and (b) to
make available on the department's publicly accessible Internet
website.
Section 5. Impact study.
(a) Report.--No later than one year following the effective
date of this subsection, the department, in consultation with
the Pennsylvania Public Utility Commission, shall issue a
report, including all of the following information:
(1) The number and location of any existing or planned
qualifying crypto-asset mining operations, including which
operations are located in an environmental justice area.
(2) The amount of greenhouse gas emissions and other air
pollutants that are:
(i) released by an onsite energy source used by a
qualifying crypto-asset mining operation; and
(ii) attributable to offsite-generated electricity,
steam, heat or cooling provided to a qualifying crypto-
asset mining operation.
(3) The anticipated increase of new, and expansion of
existing, qualifying crypto-asset mining operations.
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(4) The potential impacts of electric energy consumption
by qualifying crypto-asset mining operations, including by
prolonging the use of fossil fuel generators, on the ability
of this Commonwealth to achieve stated greenhouse gas
emission reduction goals.
(5) The ecological impacts, including ecological impacts
associated with electronic waste generation and the use or
discharge of cooling water, caused by qualifying crypto-asset
mining operations.
(6) The potential public health impacts due to the
reduced air and water quality and increased water stress on
communities near qualifying crypto-asset mining operations.
(7) The potential public health and ecological impacts
from noise generated by qualifying crypto-asset mining
operations.
(8) The amount of electric energy consumed by each
qualifying crypto-asset mining operation, including the time
of use of electricity and the potential grid stress posed by
the power load of the qualifying crypto-asset mining
operation.
(9) The source of electric energy consumed by each
qualifying crypto-asset mining operation.
(10) An analysis of energy use and greenhouse gas
emissions by type of consensus mechanism.
(11) An analysis of demand-response programs negotiated
between qualifying crypto-asset mining operations and
electric utilities.
(12) An analysis of potential rate-design measures that
could be implemented by State and local regulators to reduce
the energy consumption and dependence on fossil fuel energy
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sources of qualifying crypto-asset mining operations.
(b) Report submission.--The department shall submit the
report required under subsection (a) to the Governor, the
chairperson and minority chairperson of the Environmental
Resources and Energy Committee of the Senate and the chairperson
and minority chairperson of the Environmental Resources and
Energy Committee of the House of Representatives no later than
one year following the effective date of this subsection.
(c) Publication.--The department shall publish the report
required under subsection (a) on the department's publicly
accessible Internet website.
Section 6. Regulations.
The department and the Environmental Quality Board shall
promulgate regulations as necessary to implement the provisions
of this act.
Section 7. Effective date.
This act shall take effect immediately.
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