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A07389 Summary:

COSPNSRLupardo, Englebright, Thiele, Glick, Magnarelli, Epstein, Burdick, Steck, Rivera JD, Clark, Niou, Fahy, Wallace, Barrett, Carroll, Rosenthal L, Seawright, Gallagher, Gonzalez-Rojas, De La Rosa, Burke, Pichardo, Stirpe, Mamdani, Simon, Griffin, Anderson, McMahon, Mitaynes, Otis, McDonald, Gottfried, Galef, Dinowitz, Pretlow, Paulin, Forrest, Zinerman, Sillitti, Zebrowski, Quart, Burgos, Bichotte Hermelyn, Abinanti, Jacobson, Lavine, Sayegh, Colton, Cruz
Add §19-0331, En Con L
Establishes a moratorium on cryptocurrency mining operations that use proof-of-work authentication methods to validate blockchain transactions; provides that such operations shall be subject to a full generic environmental impact statement review.
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A07389 Floor Votes:

DATE:04/26/2022Assembly Vote  YEA/NAY: 91/56
AshbyNOCruzYGallahanNOLawlerNOPheffer AmatoNOSteckY
BarnwellYCymbrowitzYGiglio JANOLunsfordYRaNOTagueNO
BarrettYDarlingNOGiglio JMNOLupardoYRajkumarYTannousisNO
BichotteYDe Los SantosYGonzalez-RojasYMamdaniYReillyNOTaylorNO
BrabenecNODickensNOGottfriedYMcDonaldYRivera J YVanelNO
BraunsteinYDilanERGriffinYMcDonoughNORivera JDYWalczykNO
BronsonNODinowitzYGuntherYMcMahonYRosenthal D NOWalkerY
Brown E NODiPietroNOHawleyNOMeeksYRosenthal L YWallaceY
Brown K NODursoNOHevesiYMikulinNORozicYWalshNO
CahillYFitzpatrickNOJonesYNorrisNOSillittiYMr. SpeakerY

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A07389 Memo:

submitted in accordance with Assembly Rule III, Sec 1(f)
  TITLE OF BILL: An act to amend the environmental conservation law, in relation to establishing a moratorium on cryptocurrency mining operations that use proof-of-work authentication methods to validate blockchain trans- actions; and to require a comprehensive generic environmental impact statement review   PURPOSE OR GENERAL IDEA OF BILL: To establish a moratorium on cryptocurrency mining operations based on proofof-work transaction authentication methods and require completion of a comprehensive generic environmental impact study of cryptocurrency mining operations using proof-of-work methodology in the State of New York in the context of the Climate Leadership and Community Protection Act (CLCPA) goals established in statute in 2019.   SUMMARY OF PROVISIONS: Section 1 declares the legislative findings. Section 2 places a two-year moratorium on air permit issuance- and renewal for an electric generating facility that utilizes a carbon-based fuel for cryptocurrency mining operations that use proof-of-work based transaction validation methods. Section 3 requires completion of a comprehensive generic environmental impact statement by the New York State Department of Environmental Conservation. Section 4 requires one-hundred and twenty days of public comment on the environmental impact statement and the holding of public hearings in eight regions across the state prior to final issuance. Section 5 requires issuance of a final generic environmental impact statement after close of the public comment and public hearing period no later than one year after the effective date of this act. Section 6 provides definitions. Section 7 provides the effective date.   JUSTIFICATION: Block chain technology is an innovative technology that allows for the recording and efficient transfer of information. The information in each block is authenticated by users of the system in a transparent, decen- tralized, and democratic manner. Each block has a unique identifier that encodes the information of the block including code for the previous information block from which the new information block was built creat- ing a chain of information exchange known as a block chain. Proof-of-Work is a unique methodology that has been used since 2009 to create and authenticate new blocks on a block chain for cryptocurrency. There are over 16 different methodologies of authenticating information within a block. However, of these varied methods there is only one, called Proof-of-Work that, by design, uses a substantial amount of computational power to perform and thus uses a uniquely exorbitant amount of energy. The Proof-of-Work authentication method was designed to require individuals or companies to solve highly complex mathematical equations in order to authenticate a transaction and earn valuable cred- it. The more equations are solved by users the more complex the equations get. By design, there is no software that can be created that will be able to solve the equations better than brute force guesswork so the only way to get an advantage and solve the equations faster is for an individual or company to increase their computational power. This has led to the expansion of large cryptocurrency mining operations consist- ing of thousands of high power computers that run around the clock to solve as many equations as possible and authenticate the most blocks. There are an increasing number of cryptocurrency mining operations in New York performing Proof-of-Work authentication of different block- chains with some being built or modified to exclusively perform Proof- of-Work authentications. Studies show that the magnitude of the computer processing output required to authenticate a single block uses as much energy as an average American household uses in a month. The annual global energy use for PoW authentication is equivalent to that of the country of Sweden and exceeds the energy consumption of all the global activity of major tech companies like Amazon, Google, and Facebook combined. The added energy usage and corresponding increased greenhouse gas emis- sions from these new cryptocurrency mining operations performing Proof- of-Work authentications in New York could hinder or prevent compliance with the critical state carbon emissions goals put in law in the Climate Leadership and Community Protection Act of 2019. Under this law, state- wide greenhouse gas emissions must be reduced eighty-five percent by 2050 and the state economy must have net zero emissions across all sectors. We must determine whether growth of the Proof-of-Work authentication cryptocurrency mining industry is incompatible with our greenhouse gas emission targets established in law, or has other significant detri- mental impacts to our air, water, or public health. By requiring a statewide generic environmental impact statement, this crucial informa- tion about the industry's impact upon our climate law, and associated water, air and wildlife impacts, will be understood and can guide any potential future policy related to industry regulation. Climate change threatens the health, welfare, and economy of the state with increasingly severe and widespread impacts to our communities due to flooding, sea level rise, heat waves, coastal erosion, erratic and unpredictable weather patterns, shifting climatic zones, loss of wild- life, increased harmful algal blooms and invasive species, and increased risk of disease. These consequences disproportionately impact environ- mental justice communities making the need for this comprehensive assessment both an environmental issue as well as a social justice issue. We must not go backwards on our commitment, in law, to prevent these disastrous impacts to the residents of New York.   LEGISLATIVE HISTORY: New bill.   FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS: NONE   EFFECTIVE DATE: IMMEDIATELY
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