Paper notes: Computational parasites and hydropower: A political ecology of Bitcoin mining on the Columbia River

I just finished reading this paper on a lazy Sunday morning, and this post is a bit of an experiment in trying to capture the stuff I learn and make it easier to come back to in future.

Why is this paper interesting?

This paper does a fantastic job of exploring the politics behind cryptocurrencies, and how proof of work mechanisms end up incentivizing deployment in places that only exist because of significant state investment, usually made possible by the fiat currency system it rejects.

It also provides some useful analysis of the lifecycle of hydroprojects, and a bit about the political economy in the Pacific North West and how they relate to the interests of indigenous people who lived there first.

However, it’s not just useful for thinking about cryptocurrencies. I think it does a good job of providing a way to help us think about the citing of any infrastructure that takes advantage of existing amenities to operate by drawing a lot of electricity in a relatively small space. I think you could apply this thinking to the citing of more general datacentres, as well as EV charging perhaps – although in the latter case, you can probably demonstrate the utility to locals more easily.

Choice quotes:

All these quotes are from the paper Computational parasites and hydropower: A political ecology of Bitcoin mining on the Columbia River, by Lally et al, with the following DOI

Off we go…

On the Bitcoin, and it’s tethering to the underlying infra it consumes.

If Bitcoin’s infrastructure allows anyone with a computer to plug into the network and begin mining, it is only those with specialized hardware and cheap electricity who can turn the production of new Bitcoins into a profitable venture. So while popular accounts of Bitcoin’s energy usage describe the massive, abstract amounts of electricity that the network consumes, in practice, the geography of Bitcoin is highly uneven and intertwined with the infrastructural and ecological structures on which it depends.

On using conflict between crypto miners and the wider discussions about datacentre deployment:

We see cryptocurrencies like Bitcoin as a perfect vector for exploring the complex intersections between computation and socio-ecological processes

On how the cheap hydro came about, that powers all that proof of work mining (a PUD, mentinoed below is a Public Utility District – an electricity operator in a specific area):

While many of the Columbia’s largest dams, like the Grand Coulee, were the result of direct federal government investment through entities like the Works Progress Administration, the more modest dams of Chelan County came to exist through the formation of community-managed PUDs that could leverage public funds to generate and distribute power throughout the rural Northwest


The public character of hydropower is particularly pronounced in Central Washington. While many of the PUDs in Washington State purchase power in bulk and distribute it to their customers, all three dams in Chelan County are owned and managed by the PUD, meaning that they both make and distribute their own power. The production of hydropower also takes place largely on public land—within the Lake Chelan watershed, for example, 87% of the land is publicly owned (Chelan County Natural Resources Department, 2012)

On the dam lifecycle, and relations to local indigenous tribes:

While the Columbia River is the greatest producer of hydropower in the Western Hemisphere (Cosens and Williams, 2012), economic restructuring in many parts of the rural Pacific Northwest has meant that there has not been a local sink to absorb the huge quantities of power being produced. And, as many salmonid species have gained protection under the US Endangered Species Act—including eight species of salmon and four species of steelhead that make their home in the wider Columbia River Basin—the costs and benefits of large-scale hydroelectric power began to shift over time (Cosens and Williams, 2012) as dam relicensing often requires the costly installation or upgrading of fish passage (Sumner, 2017). The voice of the region’s Indigenous tribes, many of whom have had their ancestral territories and livelihoods irreparably altered through the installation of dams, have also played a critical role in dam decommissioning and removal (Fisher, 2004; Guarino, 2013; Wilson, 1999).

And more on how the economics change over time for large-ish hydro:

the majority of these dams were built with a 50-year lifespan (Guarino, 2013), and changing economies in rural areas can present challenges to generating profits from locally-sold hydropower, especially given that the costs of operation consistently rise over time.


Thus, since 1975, over 1000 dams of varying sizes have been removed in the US (O’Connor et al., 2015). This includes three high-profile dam removals in Washington State: the Condit Dam removal from the White Salmon River in 2011 and the Elwha (2012) and Glines Canyon (2014) dams from the Elwha River. The Elwha Dam removal was the largest dam removal in US history and was celebrated by environmentalists and tribes as a major victory and recognition of the rights of both Indigenous peoples and anadromous fish, including salmon

This here is the probably the key quote from the whole pape for me:

In Chelan County, only about 15% of the electricity produced by local dams is sold to local retail customers (based on 2015 numbers, see Chelan County PUD, 2015). The rest is sold to other energy markets, producing nearly 100 million dollars in surpluses that are circulated back to local residents through subsidized social services. Subsidies support artificially low electricity rates, which are sold to consumers at a loss of over $10 million, as well as fund water and wastewater services, local parks, and a fiber-optic network that provides high speed, reliable internet service across the county (Chelan County PUD, 2015).

Miners not only rely on these services—subsidized electricity and high-speed internet services, in particular—they actively consume the energy that makes the existence of such services possible.

In the interest of making quick profits, cryptocurrency profiteers threaten the very conditions that make Chelan County a desirable place for mining, potentially leading to increased electricity rates across the board (Roberts, 2018b) and reduced funding for public services.

Where to find more like this

I work for at the Green Web Foundation, and we run a fellowship research programme. Fellows share the research they carry out there on the fellowship blog, and every source we find of interest we put into an open document library using Zotero and open source research tool, that we’re referring to as the Green Web Library.