Innovation

Imagine investing €100,000 in solar panels to support the renewable energy transition, only to receive a notification a little while later that you have been blocked off temporarily from supplying back to the grid due to an electricity surplus. In the Netherlands, this scenario is becoming more and more common as the existing grid infrastructure struggles to handle the rapid increase in decentralized renewable energy sources. In times of grid overload, electricity providers simply block off stakeholders who supply their self-generated renewable energy back to the grid, leading to costly and wasteful downtime for businesses and households.

Bert de Groot, founder of Bitcoin Brabant, offers an ingenious solution to this problem. His company uses residual electricity from businesses to mine bitcoin, which in turn generates heat. This dual-purpose system replaces traditional central heating during times of energy surplus. The mining equipment, which operates on clean energy, provides highly efficient heating, reducing the reliance on natural gas. When the grid is overloaded, these systems switch on, utilizing self-generated electricity, eliminating electricity costs, and generating income from Bitcoin mining. As a result, this not only helps businesses save money and operate more sustainably, but also eases the strain on the electricity grid.

Inspiration

De Groot’s journey into Bitcoin mining began as a hobby, driven by his interest in Bitcoin as a medium of savings. He discovered that Bitcoin mining systems emit significant amounts of heat, which led him to the innovative idea of using this heat to warm his home. The real moment of inspiration was in 2022, when skyrocketing electricity prices made home mining financially unviable. De Groot recalls, “[...] it was too costly to continue mining at home, which is why I found a place where there is cheap electricity - a greenhouse. I would pay the greenhouse for electricity, and they would have the heat for free.” This practical solution not only addressed his immediate needs but also proposed an opportunity to address a broader issue: the impact of cryptocurrency mining on the environment and the resulting negative public perception it receives. De Groot challenges this perception, arguing that the
public is unaware of its possible benefits and positive externalities. As an early adopter and advocate for cryptocurrencies, he believes they offer a better alternative to the current global monetary system. Faced with declining returns from Bitcoin mining due to rising energy prices in the Netherlands, he noticed that businesses that invested in renewable energy were struggling with grid challenges, eventually leading to the development of this innovative solution.

Despite facing skepticism and negative perceptions, De Groot remains committed to showcasing the positive impact of this solution. Reflecting on an experience at the Dutch Pentecost fair, he shared, "I was trying to convince people of the benefits of my Bitcoin mining solution. People were directly coming up to me, telling me that I’m destroying the planet, that Bitcoin is only for criminals, and even directly accusing me of being a criminal." Far from discouraging him, this resistance only strengthened his dedication to demonstrating the societal benefits of Bitcoin.

Overall impact

Bitcoin Brabant's innovative approach has profoundly impacted local communities and the broader sustainability landscape. The company addresses multiple sustainability goals by mining Bitcoin using excess electricity and utilizing the resulting heat to warm business infrastructures simultaneously. For instance, it promotes affordable and clean energy (SDG 7) by preventing renewable energy waste. When the power grid is congested, surplus electricity from renewable sources like solar panels cannot be fed back into the grid, leading to downtime and wasted energy. Bitcoin Brabant solves this by using the excess electricity for Bitcoin mining, avoiding waste while generating additional revenue for businesses. According to Helseth & Mellerud (2022), repurposing waste heat from Bitcoin mining can lower heating costs by up to 50%, demonstrating significant energy and cost efficiency.

Furthermore, Bitcoin Brabant contributes to sustainable cities and communities (SDG 11) by reducing reliance on natural gas for heating. The heat generated from Bitcoin mining serves as an alternative to gas heating, decreasing demand for fossil fuels and lowering greenhouse gas emissions. Bitcoin Brabant also exemplifies responsible consumption and production (SDG 12) as the company's model ensures that renewable energy investments are fully utilized, even when the grid cannot absorb additional power. The positive externalities of this model extend beyond energy efficiency, as Bitcoin Brabant raises awareness of the sustainable potential of cryptocurrencies. Coverage by media outlets like CNN was a significant turning point for Bitcoin Brabant’s business. "The moment of realization came when CNN visited for a documentary. We showed how six miners in a greenhouse could save the equivalent of nine households of natural gas per year. This made me realize the significant impact we could have by integrating Bitcoin mining with renewable energy,” De Groot noted. As a scalable solution, Bitcoin Brabant demonstrates how technology can be harnessed for sustainability, offering a model that reduces energy waste and contributes to a balanced electricity grid.

Business benefit

As a sole proprietorship under De Groot, Bitcoin Brabant has established itself as a profitable business with steady revenue. The company primarily generates revenue by selling specialized Bitcoin mining systems to companies, such as those operating greenhouses. These systems allow companies to mine bitcoin using their excess power, with 100% of the mining revenue going directly to them. Though it might be more profitable to lease out the mining machines and to share the profits of both mining and saved electricity proceeds, the activist within De Groot is very much against this. He sees more value in offering his customers simple deals that allow them to realize the full benefits of the solution. He believes this is best achieved without long contracts and profiting from the energy his customers save.

Currently, De Groot is the company’s sole proprietor and operator. Partly thanks to the power and simplicity of the business model, together with his strong ambition, De Groot runs this company alone while simultaneously spending a lot of effort in actively engaging with regulators and locals to spread awareness. The company has grown significantly through word of mouth, especially after CNN featured the previously mentioned documentary about the practical use of its innovative technology. This sparked a wave of curiosity and attracted new customers, to which De Groot highlighted, “The demand is still overwhelming because of that one video.” He added that Bitcoin Brabant, therefore, does not have any customer acquisition costs. Through this low-cost, high-profit model, De Groot created a self-sustaining green initiative and opened new investment opportunities, attracting investors interested in green technologies.

This has put De Groot in a strong position when it comes to scaling the business, as he is in complete control of the pace at which he chooses to scale it. The business can grow as long as prospective clients meet two key criteria: they must produce a sufficient amount of renewable electricity, and the region in which they operate must frequently experience electricity grid overload. When these two criteria are met, the potential to expand the business is immense.

Social and environmental benefit

From an environmental standpoint, Bitcoin Brabant addresses the issue of excess renewable energy by utilizing surplus electricity that would otherwise go to waste. As De Groot explained, “We use the surplus electricity that would otherwise be wasted, turning it into a valuable resource for Bitcoin mining and heat generation.” This efficient use of resources maximizes the potential of renewable energy installations while reducing the reliance on fossil fuels, thereby decreasing the overall carbon footprint.

Furthermore, from a societal point of view, Bitcoin Brabant benefits companies with excess renewable energy and actively seeks to change the negative perceptions around Bitcoin mining. De Groot stated, “We constantly engage with the community to educate them about the positive impacts of Bitcoin mining when done
sustainably.” This involves increasing awareness around the potential of sustainable Bitcoin mining and highlighting positive externalities such as enhanced energy efficiency and reduced reliance on fossil fuels. Therefore, Bitcoin Brabant clearly demonstrates a strong commitment to both environmental and social sustainability, overall creating economic benefits while contributing to a healthy natural environment.

Interview

Bert de Groot, CEO