Bitcoin Mining Energy Demand Spikes as Hydropower Takes Lead

Alexander Neumueller, presenting the findings at the Energy Investors Forum in Dallas, noted that hydropower has overtaken natural gas as the primary energy source for miners. Low-carbon power now accounts for 59.4% of the industry’s energy mix, up from 52.4% in previous studies. This transition is largely attributed to expanded mining operations in hydro-rich regions, specifically Ethiopia, where operators are leveraging low-cost power from the Grand Ethiopian Renaissance Dam.

Despite the cleaner energy profile, the industry’s total greenhouse-gas emissions climbed from 40 million to 48 million tonnes of CO2 equivalent. This 20% rise highlights that efficiency gains in newer mining hardware have failed to fully offset the rapid expansion of total hashrate. Meanwhile, the sector is eyeing diversification into artificial intelligence. Only 10% of surveyed firms have currently integrated AI or accelerated computing services, though 40% of the remaining participants are actively exploring such transitions. Experts warn that moving into AI requires significant infrastructure upgrades, including specialized cooling and networking, which are far more demanding than the flexible power requirements of traditional digital asset mining.