Few objections to Bitcoin are as common as the one about its electricity consumption. And the objection is justified: Bitcoin really does need a great deal of energy. The more interesting questions come next: what the electricity is used for, where it comes from and how to put it sensibly in context.

Why Bitcoin needs electricity

New blocks in the Bitcoin chain are created through a competition known as mining. Specialised computers search for a solution that can only be found through a very large number of attempts. The first to find it may add the next block and receives a reward.

This effort is not a side effect but the core of the system’s security: anyone wishing to rewrite the past would have to muster more computing power than all honest participants combined – and pay for enormous amounts of electricity and equipment to do so. The energy spent makes fraud expensive.

How much is it?

The Cambridge Centre for Alternative Finance at the University of Cambridge has tracked the electricity consumption of the Bitcoin network for years. Its 2025 report estimates it at around 138 terawatt hours a year – about 0.5 per cent of global electricity consumption, comparable to a medium-sized European country. That is a lot, and it is only honest to say so.

Two points help to put this in context:

  • “Electricity per transaction” is misleading. Consumption depends not on the number of payments but on the competition for mining. A block may contain a handful of payments or thousands; additional layers such as the Lightning Network bundle very large numbers of payments without increasing consumption.
  • The source is what matters. A kilowatt hour from hydropower that would otherwise go unused is not the same as one generated by a coal-fired power station.

What is true – and what is not

“Bitcoin runs mainly on coal.” – No longer. According to the 2025 Cambridge report, around 52 per cent of mining electricity comes from renewable sources and nuclear energy: hydropower about 23 per cent, wind 15, nuclear just under 10, solar 3. Coal has fallen to below 9 per cent – natural gas, on the other hand, has risen to around 38 per cent. A large share of the electricity therefore remains fossil. An important caveat: the report is based on a survey of mining companies, and an industry’s own disclosures should always be read with a degree of caution.

“Mining takes electricity away from households.” – Often the opposite is true. Miners look for the cheapest electricity, and that is found where there is a surplus: at remote hydropower plants, during wind and solar peaks, or in places that lack transmission lines. In regions such as Texas, large mining operations switch off during shortages and release electricity back to the grid. In this way they can even help to stabilise power grids.

“It is pure waste.” – Whether energy use is wasteful depends on what you get in return. Bitcoin provides a global, open system for ownership and transfer without an intermediary. Opinions on its value may differ – but it is not zero. Bank branches, data centres, cash-in-transit services and gold mining consume energy too.

“It means methane is burned rather than vented.” – There are projects in which gas from oil fields, which would otherwise be flared or vented, is used for mining. Methane is a particularly potent greenhouse gas. Such projects can reduce emissions, but so far they account for only a small part of mining overall.

What must also be said

  • Electronic waste. Mining equipment becomes obsolete within a few years. Scientific estimates put the resulting electronic waste at tens of thousands of tonnes per year.
  • Noise and siting. Large facilities are noisy and, if poorly planned, a burden on local residents.
  • Fossil share. As long as part of the electricity comes from coal and gas, Bitcoin also causes emissions.

Bitcoin uses a great deal of energy – that is the price of its security. Whether this is justified depends on the source of the energy and on how much you value an open, independent monetary system. Both can be debated on the facts.

What this means for you

If you hold Bitcoin, you use the network – but individual payments add little to its electricity use. For your personal footprint, what matters most is holding Bitcoin securely for the long term rather than moving it back and forth between providers.

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Disclaimer

Not financial or investment advice. This article is purely explanatory. It contains no forecast and no recommendation to buy, hold or sell Bitcoin. 21 Fruits does not hold Bitcoin and receives no commissions. Please base any decisions on your own judgement.

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