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.
STATE OF NEW YORK
________________________________________________________________________
7389--C
2021-2022 Regular Sessions
IN ASSEMBLY
May 6, 2021
___________
Introduced by M. of A. KELLES, LUPARDO, ENGLEBRIGHT, THIELE, GLICK,
MAGNARELLI, EPSTEIN, BURDICK, STECK, J. D. RIVERA, CLARK, NIOU, FAHY,
WALLACE, BARRETT, CARROLL, L. ROSENTHAL, SEAWRIGHT, GALLAGHER, GONZA-
LEZ-ROJAS, BURKE, STIRPE, MAMDANI, SIMON, GRIFFIN, ANDERSON, McMAHON,
MITAYNES, OTIS, McDONALD, GOTTFRIED, GALEF, DINOWITZ, PRETLOW, PAULIN,
FORREST, ZINERMAN, SILLITTI, ZEBROWSKI, QUART, BURGOS, BICHOTTE HERME-
LYN, ABINANTI, JACOBSON, LAVINE, SAYEGH -- read once and referred to
the Committee on Banks -- reference changed to the Committee on Envi-
ronmental Conservation -- committee discharged, bill amended, ordered
reprinted as amended and recommitted to said committee -- again
reported from said committee with amendments, ordered reprinted as
amended and recommitted to said committee -- recommitted to the
Committee on Environmental Conservation in accordance with Assembly
Rule 3, sec. 2 -- committee discharged, bill amended, ordered
reprinted as amended and recommitted to said committee
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
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Legislative findings. The legislature hereby finds and
2 declares that:
3 (a) Climate change threatens the health, welfare, and economy of the
4 state with increasingly severe and widespread impacts to our communities
5 due to flooding, sea level rise, heat waves, coastal erosion, erratic
6 and unpredictable weather patterns, shifting climatic zones, loss of
7 wildlife, increased harmful algal blooms and invasive species, and
8 increased risk of disease, in part, which leads directly to loss of
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD11081-19-2
A. 7389--C 2
1 life, property damage and reduction in value, ecological damage, and
2 increased infrastructure costs;
3 (b) It is the policy of the State of New York to conserve, improve and
4 protect its natural resources and environment and to prevent, abate and
5 control water, land and air pollution, in order to enhance the health,
6 safety and welfare of the people of the state and their overall economic
7 and social well-being;
8 (c) To mitigate the current and future effects of climate change, the
9 State of New York implemented the Climate Leadership and Community
10 Protection Act, requiring that statewide greenhouse gas emissions be
11 reduced eighty-five percent by 2050 and that the state has net zero
12 emissions in all sectors of the economy by that time;
13 (d) Cryptocurrency mining operations running proof-of-work authentica-
14 tion methods to validate blockchain transactions are an expanding indus-
15 try in the State of New York; and
16 (e) The continued and expanded operation of cryptocurrency mining
17 operations running proof-of-work authentication methods to validate
18 blockchain transactions will greatly increase the amount of energy usage
19 in the state of New York, and impact compliance with the Climate Leader-
20 ship and Community Protection Act.
21 § 2. The environmental conservation law is amended by adding a new
22 section 19-0331 to read as follows:
23 § 19-0331. Moratorium on air permit issuance and renewal.
24 1. For the period commencing on the effective date of this section and
25 ending two years after such date, the department, after consultation
26 with the department of public service, shall not approve a new applica-
27 tion for or issue a new permit pursuant to this article, or article
28 seventy of this chapter, for an electric generating facility that
29 utilizes a carbon-based fuel and that provides, in whole or in part,
30 behind-the-meter electric energy consumed or utilized by cryptocurrency
31 mining operations that use proof-of-work authentication methods to vali-
32 date blockchain transactions.
33 2. For the period commencing on the effective date of this section
34 and ending two years after such date, the department shall not approve
35 an application to renew an existing permit or issue a renewal permit
36 pursuant to this article for an electric generating facility that
37 utilizes a carbon-based fuel and that provides, in whole or in part,
38 behind-the-meter electric energy consumed or utilized by a cryptocurren-
39 cy mining operation that uses proof-of-work authentication methods to
40 validate blockchain transactions if the renewal application seeks to
41 increase or will allow or result in an increase in the amount of elec-
42 tric energy consumed or utilized by a cryptocurrency mining operation
43 that uses proof-of-work authentication methods to validate blockchain
44 transactions.
45 § 3. Generic environmental impact statement. (a) The department of
46 environmental conservation, in consultation with the department of
47 public service, shall prepare, pursuant to article eight of the environ-
48 mental conservation law, a generic environmental impact statement on
49 cryptocurrency mining operations that use proof-of-work authentication
50 methods to validate blockchain transactions.
51 (b) The generic environmental impact statement shall address, at a
52 minimum:
53 (i) the number and location of existing cryptocurrency mining oper-
54 ations that use proof-of-work authentication methods to validate block-
55 chain transactions in the state;
A. 7389--C 3
1 (ii) the amount of electric energy consumed by each cryptocurrency
2 mining operation that uses proof-of-work authentication methods to vali-
3 date blockchain transactions;
4 (iii) the sources of electric energy consumed by each cryptocurrency
5 mining operation that uses proof-of-work authentication methods to vali-
6 date blockchain transactions and the type of fuel used by each energy
7 source;
8 (iv) the amount of greenhouse gas emissions and co-pollutants released
9 by each energy source attributable to providing electric energy to cryp-
10 tocurrency mining operations that use proof-of-work authentication meth-
11 ods to validate blockchain transactions;
12 (v) the anticipated increase, if any, of cryptocurrency mining oper-
13 ations that use proof-of-work authentication methods to validate block-
14 chain transactions in the state and the anticipated expansion, if any,
15 of existing operations;
16 (vi) the potential impacts of electric energy consumption by crypto-
17 currency mining operations that use proof-of-work authentication methods
18 to validate blockchain transactions on the state's ability to meet the
19 greenhouse gas emission reduction goals set forth in article seventy-
20 five of the environmental conservation law;
21 (vii) the amount of water usage, water quality and other ecological
22 impacts, if any, of cooling water use by cryptocurrency mining oper-
23 ations that use proof-of-work authentication methods to validate block-
24 chain transactions;
25 (viii) the potential public health impacts, if any, due to reduced air
26 and water quality in communities near cryptocurrency mining operations
27 that use proof-of-work authentication methods to validate blockchain
28 transactions;
29 (ix) the potential statewide public health impacts, if any, from
30 increased greenhouse gas emissions released by cryptocurrency mining
31 operations that use proof-of-work authentication methods to validate
32 blockchain transactions; and
33 (x) the social and economic costs and benefits, if any, of cryptocur-
34 rency mining operations that use proof-of-work authentication methods to
35 validate blockchain transactions.
36 § 4. Any generic environmental impact statement draft shall be posted
37 on the department of environmental conservation's website and be subject
38 to 120 days of public comment from the date of issuance. The department
39 of environmental conservation shall conduct at least one public hearing
40 in each of the following regions of the state: western New York, the
41 finger lakes, the southern tier, central New York, the Mohawk valley,
42 the north country, the capital region/Hudson valley, and the City of New
43 York/Long Island, as defined by the Empire State Development Corpo-
44 ration, and provide meaningful opportunity for comment.
45 § 5. The department shall issue a final generic environmental impact
46 statement after close of the public comment and public hearing period
47 and no later than one year after the effective date of this act.
48 § 6. For the purposes of this act:
49 (a) "Cryptocurrency mining operations that use proof-of-work authenti-
50 cation methods" shall mean the use of a consensus algorithm in a block-
51 chain network used to confirm and produce new blocks to the chain to
52 validate a cryptocurrency transaction, where competitors complete new
53 blocks and where the algorithm changes the complexity of the competition
54 in a manner that is designed to and/or results in increased energy usage
55 for each competitor when the complexity is increased; and
A. 7389--C 4
1 (b) "blockchain" shall mean a digital ledger in which transactions are
2 recorded chronologically and publicly.
3 § 7. This act shall take effect immediately and shall apply to all
4 permits or renewal applications filed after such date.
