- KPMG’s report explores Bitcoin’s environmental impact, revealing data on energy consumption and emissions.
- Bitcoin’s energy consumption is just a fraction of global electricity usage, challenging common criticisms.
- Despite misconceptions, KPMG highlights high-impact use cases of Bitcoin with potential societal benefits.
KPMG, one of the world’s leading accounting firms, has recently released a comprehensive report examining the actual environmental impact of Bitcoin while also exploring potential opportunities for the cryptocurrency. The contentious topic of Bitcoin’s energy consumption, particularly concerning mining activities, has prompted KPMG to investigate its environmental footprint and consider its role in a sustainable future.
— Dennis Porter (@Dennis_Porter_) August 1, 2023
The report begins by acknowledging Bitcoin’s maturity as an asset class, yet it remains plagued by misconceptions and misunderstandings, even with its growing adoption. KPMG’s aim with the report is to dispel common myths surrounding Bitcoin and provide an impartial assessment of its impact on the environment, society, and governance.
A crucial revelation from the report is that although Bitcoin’s energy consumption is considerable—around 110 terawatt-hours per year—it constitutes only a fraction (approximately 0.55%) of global electricity usage. For context, this amount is comparable to the energy consumed by household tumble dryers. Surprisingly, these figures challenge the prevalent criticism Bitcoin has faced over its energy consumption.
KPMG emphasizes that the primary concern should not be focused solely on energy consumption but on the emissions generated during energy production, particularly when derived from fossil fuels. The report further compares Bitcoin mining’s CO2 emissions, amounting to 67 MtCO2e per year, with other industries such as gold mining (100 MtCO2e), tourism (4,500 MtCO2e), and fashion (2,100 MtCO2e) annually. This analysis reveals that Bitcoin’s emissions are relatively minimal in the broader context.
Although the report primarily delves into Bitcoin’s environmental impact, it also recognizes its potential to provide value through its various high-impact use cases, benefiting users and society.
The report argues that while Bitcoin’s energy consumption is important to consider, it should not overshadow the broader issue of emissions associated with energy production. When comparing Bitcoin’s emissions to those of other industries and human activities, such as tourism and fashion, its impact appears relatively insignificant.