Crypto Mining Farm in Remote Washington Town Gets Green Light, Despite Wildlife Concerns

A local biologist appealed Merkle Standard’s application to convert a former paper mill into a crypto mining farm, citing noise pollution’s potential impact on local wildlife


Blockworks exclusive Art by Axel Rangel


key takeaways

  • Merkle Standard can now begin work on its proposed crypto mining farm in remote Washington town
  • Around 30,000 mining rigs will power the site, initially consuming 100 megawatts of electricity

A proposed crypto mining farm in Washington state, pegged to be one of the biggest in the US, has gained conditional approval over the concerns of local residents.

California-based investment firm Allrise Capital had applied for a permit to convert a 927-acre site in the unincorporated Pend Oreille County town of Usk into a full-scale crypto operation.

The site once housed a paper mill, Ponderay Newsprint. The factory went bankrupt in 2020 and closed down, local media The Spokesman Review reported. Usk was home to just 1,229 people last year. 

Last month, Pend Oreille County held a five-hour virtual meeting to determine whether to grant Allrise Capital conditional approval. The proposed site is on land zoned as R-5 Residential, which limits construction to one home per five acres.

If fully realized, the operation would initially consume up to 100 megawatts of electricity and house 30,000 Bitmain mining rigs alongside dozens of cooling towers. The firm has plans to boost its energy usage to 500 megawatts within the first year.

Concerns surrounding energy consumption reportedly surfaced during the hearing — the site was calculated to consume the equivalent of two former local aluminum smelting factories operating at full capacity.

Despite the farm’s energy demand, fossil fuels would not make up a majority of its energy mix, a common critique of crypto mining operations. Washington state generated around 55% of its electricity from hydropower in 2020. Just 13% was attributed to natural gas and 10% to coal. The rest came from nuclear, wind and other renewable sources, such as geothermal wells.

Additional worries were raised regarding how much water would be pulled from a nearby river to cool the mining rigs, and whether discharged water would contain polluting chemicals – for which the firm would have to acquire a waste discharge permit.

There was also confusion as to which Allrise Capital subsidiary would be in charge of the site, after Pend Oreille Real Estate LLC was named on the permit. It was eventually settled that Californian bitcoin mining firm Merkle Standard would be its operator.

In addition to locals’ concerns, a wildlife biologist filed an appeal, citing potential noise pollution impacting local wildlife, including threatened long-eared bats and white pelicans.

County examiner mostly concerned about noise pollution from crypto mining rigs

At the time, a lawyer representing Merkle Standard, Taudd Hume, said the proposed site was “the largest thing that has ever come down the pike for Pend Oreille County,” so much so that the decision to approve the firm’s permit demands a “no stone left unturned” approach.

Hume claimed the mining farm would be “very clean, high-tech use,” and that all Merkle Standard would do is place “computers in boxes, putting them in the parking lot and letting them run.”

While officials shot down the appeal focused on wildlife concerns, hearing examiner Christopher Anderson stipulated that Merkle Standard would not impose noise higher than 60 decibels on any populated property — whether on the site or not — between 7 am and 10 pm.

The proposed crypto mining farm must also not emit noise higher than 50 decibels between 10 pm and 7 am, The Spokesman Review noted. If sound leaving the property exceeds 75 decibels (about the same as a vacuum cleaner), Merkle Standard must add “sound-deadening technology.”

In any case, Merkle Standard can now move ahead with its crypto mining operation in Usk. The site is projected to consume a similar amount of electricity as the gas-powered Greenidge plant in upstate New York, which has faced backlash from local residents over its potential for polluting nearby Seneca Lake.

This story was updated at 2:25 pm ET on June 2 2022 with context surrounding decibel levels and Greenidge criticism and at 3:36 am ET on Jun 24 2022 to correct the county that held the virtual meeting to discuss the permit.

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