ERCOT paid Bitcoin miner $31.7 million to reduce energy usage during August heat wave

A Bitcoin mining company with operations in Texas earned a record profit of $31.7 million in energy credits for reducing its power usage during the continuously high temperatures in August.

Jason Les, CEO of Riots Platforms, Inc. called August a "landmark month" after being paid through the Electric Reliability Council of Texas, or ERCOT's, demand response program.

ERCOT, who runs the state's power grid and has come under fire since the electricity failure during 2021's winter freeze, will pay entities, or in this case, miners like Riot who use a lot of power, to cut back during periods of peak demand, and hopefully, ease stress on the grid.

Riot said in a release that it curbed its power usage by more than 95% during those peak periods, "forgoing revenue from its Bitcoin mining operations to instead provide energy resources to ERCOT."

"The Company's curtailment of operations meaningfully contributed to reducing overall power demand in ERCOT, helping to ensure that consumers did not experience interruptions in service," the release said.

Texans were asked to conserve many times last month, but as one energy expert explained it, ERCOT will call on large load carriers that have a contract with them to turn off at strategic times to help with generation.

"A normal conservation is hey can you turn up your A/C bit, try not to use your dryer, turn off the oven. An EEA2 action is they went and took an action and said, 'Hey, we're going to go and have these loads turn off to free up the grid," said David Kinchen, CEO of Energy Ogre.

As our partners at chron.com point out, Texas had made itself a welcome place for bitcoin miners, so much so that mining accounts for a large chunk of the state's consumption. For example, in 2022, bitcoin projects accounted for 33 gigawatts of energy compared to all Houston households combined using an estimated six gigawatts per year.

CNBC did an even deeper dive into the payout and Riot's operations, noting that Riot has been powering down at its mine an hour north of Austin to help lessen the burden on the grid.

The boost from ERCOT also helped Riot at a time when it's been facing millions of dollars in losses.