Shares of Greenidge Generation Holdings Inc. tumbled 15 percent Friday, the day after Sen. Elizabeth Warren of Massachusetts asked the company to deliver details on the environmental impact of its Bitcoin mining operations.
The stock had already been in a tailspin before Warren sent a six-page letter to Greenidge CEO Jeffrey Kirt requesting written responses by Dec. 17 to a series of questions.
The Nasdaq-listed shares — ticker symbol: GREE — have fallen nearly 30 percent over the past five days and nearly 45 percent over the past month as the company braces for the state’s decision on its pending application to renew its air emissions permit.
“Your company claims carbon neutrality through the purchase of carbon offsets,” Warren wrote, “but its Dresden facility is still putting hundreds of thousands of metric tons of carbon dioxide into the atmosphere that would not be emitted otherwise.”
Warren asked Kirt to provide the specific location of those claimed carbon offsets as well as details about the company through which it acquired them.
Greenidge claims the offsets make the plant “carbon neutral,” and that description is routinely repeated without qualification in articles in the cryptocurrency trade press.
However, New York’s 2019 climate law explicitly states that electric generation facilities are not eligible to count carbon offsets in calculating their net greenhouse gas emissions.
The state Department of Conservation is currently weighing whether to renew Greenidge’s Title V air permit, which limits the greenhouse gases the plant may emit to 641,000 tons of CO2-equivalent per year.
That permit officially expired in September, but the DEC has extended it pending its decision on the renewal application. In that application, Greenidge seeks no change in the 641,000-ton limit despite its stated intent to sharply increase the plant’s power production.
Earlier this year, the DEC asked Greenidge how it intended to comply with the state’s 2019 Community Leadership and Climate Protection Act. CLCPA requires the state to reduce its CO2-e emissions by 40 percent by 2030.
The company responded in an Aug. 2, 2021 letter to the agency written by David Murtha of the consulting firm ERM. That letter acknowledged that Greenidge’s combined CO2-e emissions from the plant and from the natural gas wells and pipelines that supply it totaled more than 1 million tons per year — far above its requested limit.
DEC Commissioner Basil Seggos later tweeted that Greenidge had not shown compliance with CLCPA.
DEC officials are now reviewing public comments on the renewal application. Opponents have submitted thousands of comments that call for Gov. Kathy Hochul’s Administration to deny the permit renewal.
Warren’s letter asked Kirt to respond to seven broad inquiries, several of which would require responses to more than one question. For example, this inquiry is followed by 10 specific questions:
“Your company is planning to significantly scale both energy production and Bitcoin mining in the coming months and years. Please describe your scaling plans.”
In addition, Warren asks questions about the plant’s intake of water from Seneca Lake and its schedule for reaching compliance with the federal Clean Water Act.
The former Harvard Law School professor, who chairs two Senate subcommittees dealing with economic policy, also asks Kirt for estimates of the impact of the plant on energy costs to local families and businesses.
“What measures are you taking to ensure that local consumers and small businesses are not bearing the costs of Greenidge’s energy consumption?” she asks.
While Warren’s letter appears to have accelerated the stock’s slump, Greenidge still has ardent supporters.
In a Dec. 3, 2021 article in the popular financial website Seeking Alpha, Stella Mwende made the case for why she is bullish on the company’s stock.
She acknowledged that Greenidge’s Dresden plant produces high levels of greenhouse gases but expressed faith in the company’s “commitment to carbon-neutral mining of Bitcoin.”
She said the company’s planned ventures in South Carolina and Texas will tend to rely on renewable energy sources.
“As it stands Bitcoin fans should prepare for this signature crypto [company] to go green (in its mining process) despite its current status as a holder of an enormous carbon footprint,” she wrote.
“At the current pace, Greenidge is moving in the right direction that is by increasing its Bitcoin in tandem with a decrease in the carbon footprint. In my view, this stock is a strong buy and hold at the current discounted rate.”
Seeking Alpha asks its guest columnists to provide a disclosure statement. Mwende’s began: “I/we have a beneficial long position in the shares of GREE either through stock ownership, options, or other derivatives.”
Generally, one who holds a “long position” owns shares.
Mwende’s article drew three “likes” from readers, as well as one comment, which read:
“Why you don’t mention the air permit renewal the company is waiting for. If they do not get it, they have to close their Dresden facility.”
Peter is a three-time Pulitzer nominated reporter covering environmental issues through his first-of-its-kind digital publication The Water Front. He’s won an array of Associated Press, UPI, and Society of Professional Journalist awards. His reporting on environmental issues continues to be featured in prominent New York publications and is available on FingerLakes1.com through an exclusive content partnership. Have a question or lead? Send it to [email protected].