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Bitcoin mining company Riot Platforms is defending its participation in Texas’ electricity market programs after recent headlines claimed the state ‘paid’ the miner over $30 million to reduce power in August.
In a statement released Friday, the Nasdaq-listed Riot asserted it earned just $7 million through the Electric Reliability Council of Texas’ (ERCOT’s) ancillary services market, while selling $24 million in pre-purchased energy back to its retail provider TXU Energy during August’s heatwave. The company called its ancillary services premium “less than one percent” of the near $1 billion ERCOT spent to ensure grid reliability as temperatures soared.
Riot, which operates a cryptocurrency mining facility in Rockdale, Texas, said it provided over 84,000 megawatt hours of power back to the grid last month by temporarily halting mining operations. This helped reduce strain on the system during extreme weather, preventing disruptions for consumers.
“Riot actively participates in several demand response programs for the benefit of all Texans,” the company statement read. “We are proud to contribute to the overall health and prosperity of the state that has helped our company to grow into the innovative, thriving team that it is today.”
Recent headlines stemming from a CNBC article claimed the state of Texas paid Riot $31.7 million to shut down last month. Riot contends the reporting was “sensational and inaccurate,” failing to capture the nuances of Texas’ deregulated power market and direct response systems. States and energy producers all across the country are involved with ancillary service programs.
The company says its participation in ERCOT’s ancillary services market is a “competitive bidding process” where large commercial customers like bitcoin miners bid to receive payments for reducing electricity use during peak demand periods. This helps stabilize the grid at critical times.
Riot also stressed that selling pre-purchased energy back to providers like TXU Energy allows it to earn credits that reduce future power bills. This can be an efficient economic move when mining is paused.
As one of the largest publicly traded bitcoin miners in North America, Riot has become a focal point in debates over cryptocurrency’s energy footprint. In the press release announcement, the company maintains its involvement in Texas grid programs provides reliability and cost benefits to consumers, while supporting local jobs.
