New York has denied a permit to a controversial crypto mining plant

New York state environmental regulators have declined to extend a key permit to a controversial cryptocurrency mining operation in the state's Finger Lakes region.

The state Department of Environmental Conservation said Thursday that the gas-powered Greenidge generation plant does not comply with the state's climate laws and declined to extend an air quality permit. The 107-megawatt plant became a flashpoint in the debate earlier this year as New York lawmakers passed a bill placing a moratorium on new permits for gas-powered crypto mining.

Gov. Kathy Hochul has yet to sign that bill. But her administration has now ruled that the Greenidge facility is out of step with New York's 2019 Climate Leadership and Community Protection Act. The law requires emissions to be slashed statewide by 40% from 1990 levels by 2030 and 85% by 2050.

Greenidge converted the decades-old plant to natural gas in 2017 and began mining bitcoin from the facility in 2019, sparking significant backlash within the region, which is known in part for its wine production.

In a letter to Greenidge, the DEC wrote that greenhouse gas emissions from the facility had "drastically increased" since the company was issued a permit in 2016. The increase, the letter said, was driven by Greenidge altering the facility's purpose to increasingly focus on powering proof-of-work mining. More than half of the facility's energy production in the first six months of 2021 went toward "behind-the-meter" crypto mining, according to the DEC.

Greenidge said Thursday it will appeal the decision and, in the meantime, its operations will continue. The company said it offered a plan to reduce its emissions 40% by 2025, but state regulators declined to engage further.

"We believe there is no credible legal basis whatsoever for a denial of this application because there is no actual threat to the State's Climate Leadership and Community Protection Act (CLCPA) from our renewed permit," reads the statement. "This is a standard air permit renewal governing emissions levels for a facility operating in full compliance with its existing permit today. It is not, and cannot be transformed into, a politically charged 'cryptocurrency permit.'"

The DEC's decision marks a major victory for local environmental and other advocacy groups who led the push against using greenhouse-gas-emitting plants to power crypto mining.

"Governor Hochul and the DEC stood with science and the people, and sent a message to outside speculators: New York's former fossil fuel-burning plants are not yours to re-open as gas-guzzling Bitcoin mining cancers on our communities," said Yvonne Taylor, vice president of Seneca Lake Guardian, in a statement Thursday. "Now, it's up to Governor Hochul to finish the job by signing the cryptomining moratorium bill."

The DEC had delayed the decision multiple times and said it sifted through 4,000 comments before coming to Thursday's ruling.