Indonesia mainly runs on thermal power, it is kind of sad that those crypto currencies indirectly encourage making profits out of cheap labor and the planet itself.
On the flip side, since the network doesn't care where the miners live, for-profit mining will end up happening in countries with an abundance of hard-to-transport cheap renewable energy.
If Indonesia uses thermal power then using the electricity generated from it has little negative environmental impact.
Additionally I'm unclear where anything is "making profits from cheap labor". The miner benefits from the low cost of living in Jakarta, but making that out to be a bad thing is like complaining that housing in Kansas isn't as expensive as New York.
"Thermal power" is a rather misleading term. It refers to power generation by steam turbines, but doesn't describe the heat source. Nuclear power plants and solar thermal electric plants are "thermal power", but don't emit CO2 in large quantities.
Could you clarify this? I'm not overly familiar with California's rates, but I've looked at what seem to be the two most prominent providers (PG&E and SCE), and neither of them have rates higher than 35 cents even at their top tiers. And there is no mention of increased rates during peak hours or days (I'm not even entirely sure what would define a peak day).
They have a smart rate program, where they give you small discount on regular rates in exchange for high rates in high-consumption days (they choose them and tell you in advance) between 2pm and 7 pm. That's when you get the crazy rates. But if you avoid consuming too much power in these hours, it still comes out as beneficial for you. Outside of the peak rates, highest rate I see on my bill is tier 4, $0.35114/kWh.
I interpreted that as '30 percent less than', closer to power pricing I'm used to in the US.
Notably Tiyo Triyanto, the miner quoted in the opening paragraphs, is now mining Litecoin instead of Bitcoin and betting on prices increasing before the ASIC arms race starts for that cryptocurrency.
Well supposedly the difference would be only 5x max for LTC ASIC and be significantly more expensive per equivalent ASIC chip due to the memory requirements compared to BTC ASICs.
The article certainly seems wrong. Other than Hawaii which is an obvious outlier (36.61) the most expensive mainland electricity in the US is in California at 16.71.
It is wrong. The links you provide seem to be more accurate.
I write software that deals with monitoring power (powerhouse dynamics). We have customers in a lot of states, and to estimate their costs they have to input the cost per/kWh.
In the US power costs usually between 8-12 cents per kilowatt hour. There are extra costs if your commercial which can add 10-20%.
We've found that power cost, especially commercial power is oddly hard to estimate with "demand charges" and rates varrying with time...
There are a few companies compiling this cost data in detail which we'll likely be buying soon.
I know in the Bay Area Commercial rates charged by PG&E
are lower than Residential. Never understood why.
Actually, our electricity in the SF Area is very expensive.
I don't know why. One half of our power is from Dams.
I think it's 1/2.
Actually, I think they charge us so much is because they
know we will pay.
To all the Élon Musk fans, I wonder what your PG&E bill will
be?
While I'm on this subject--yea, I'm an electrician, don't
heat your house with elecrtic heaters. They will really
eat up the kilowatts, and look into Radiant hydronic heating
if updating. My bill is 1/4 of what it used to be. You
can install yourself, if determined.
I had a studio in Paris that only had electric heat. 2 months after it started getting really cold I got the electric bill, $250. After that I shut off the heater at the breaker, bought a portable heater and a jug (20L) of kerosene for $80. That jug lasted 2 winters.
I grew up in a house with electric heat in Massachusetts (not known for its mild winters). Your not kidding about electric heat being expensive. We wore a lot of sweaters in the winter before my parents installed a oil heater.
Just over $0.07 in Manitoba .. which has gone up considerably (likely close to 50%) over the last 5-6 years! We use to have it great until they decided they need to build more dams :(
Yes, in a lot of jurisdictions, that's the generator cost. Generation is typically < 1/3rd the total cost of electricity.
Here in NZ, I get a generation charge, a national lines charge, and a local lines charge per kwh. Then I've got an additional daily charge to be connected to the network. It works out to NZ$0.22/kwh.
Electricity isn't very useful when it's at the hydro lake!
[Edited to add numbers]
Looking into it, Ontario power is:
(Peak 11AM-5PM)
12.4c/kWh generation.
3.37c/kWh distribution
1.21c/kWh transmission
$17.29/mo connection.
So, that's CDN16.98c/kWh delivered to a suburban home.
I live in Southern California. SC Edison has a 4 tier pricing system based on kWh consumed. The first tier is $0.13 kWh, while the top tier is $0.31 kWh.
Actually, ASIC mining bitcoin is fairly unprofitable at the moment :/ A 60GH/s BFL machine nets 0.11 BTC (about $15/day at current exchange rates) right now.
since litecoin uses scrypt hashing algorithm, which has memory requirement. early asic for litecoin mining is not likely to be as huge a performance jump as asic for bitcoin mining (compared to gpu mining).
so his investment may not be that bad. :)
Sounds like the only people making money off of bitcoin mining are the manufacturers of these increasingly more powerful ASIC mining hardware. Once one gets developed and released, it's only a matter of time until it costs more in electricity than it's mining. Then, lo and behold, they're ready with an even faster/more energy-efficient one.
$114 a day is equivalent of $14.25 working 8 hrs/day. I think there are many ways to make $14/hr without investing in expensive equipment (which will also need to be replaced eventually running that hot). Actually, person that is capable of building such thing and keeping it working could probably easily fetch much more than $14/hr.
As far as I understood from the article, this thing is not set up and forget affair, it requires maintenance. I imagine if you leave it and some cooler breaks, it could very well cause a fire or melt down completely.
From this calculator: http://dustcoin.com/, you need about 60,000 KH/S to make $114 a day (excluding power cost). One of the most efficient $/hashrate GPUs for litecoin mining is the ATI 7950 at about $210 a piece and ~600 KH/s. 105 * 600 KH/s = ~60000 KH/s = ~$114, so it works out. That's $20,000. So if you spend $20,000 you can buy yourself a job that pays $114 a day. It will take 6 months just to break even. Better hope the difficulty hasn't increased enough in that time to make your GPUs irrelevant (hint: it probably will).
Keep in mind that I was very generously excluding the very significant cost of power, the very significant cost of all the motherboards/cpu/ram/power supplies to run those GPUs, and the power and space required to cool them. Realistically we're looking at more like $50k.
>“Currently I’m making about 60 litecoin per day,” he said. “I’ve kept 95% of the mining profit since April and once the major exchanges start accepting LTC, others will follow, and price is expected to soar. So that 60 LTC could turn into $1,500.”
This is absurd. If he thinks 60 LTC will be worth $1,500, he should spend the $20,000 he spent on GPUs on LTC instead. He'd turn $20,000 into $250,000 with no work required (another hint: assuming you can turn $20k into $250k in 6 months with no work as a sure thing is also absurd).
$114/day is actually a very good income income in Indonesia. For comparison, fresh grads are paid around $200 - $1000 a month (excl. bonuses) depending on the company (better pay for established, international corp).
The only problem I see is the reliability of the electricity provider itself. There are frequent surges and parts of Jakarta are known to experience regular rolling blackouts.
Article title is wrong, these are Litecoins not Bitcoins.
This might pay off mining 60LTC per day and hoarding them. The guy who started Litecoin now works for Coinbase, which may adopt Litecoin and will no doubt start a gigantic speculation bubble this Indonesian dude can cash out with
http://www.wired.com/wiredenterprise/2013/08/litecoin/
LTC GPU mining makes more sense. Right about when BTC ASICs started to appear, there was a thread in bitcointalk that LTC GPU mining made about 30% more than BTC at the time, so commercial miners were switching over.
Having enough money that you can invest it (in hardware or business processes) to make more money for yourself is an advantage over those people who barely have enough money to live on.
I don't consider this a design flaw in the concept of money itself. The same goes for BTC.
This is a "fundamental flaw" of ANY capitalist system. The rich can usually make more money than the poor. Bitcoin is no worse than other systems (but better in other aspects, eg decentralization).
53 comments
[ 3.6 ms ] story [ 121 ms ] threadsource wikipedia: http://en.m.wikipedia.org/wiki/List_of_power_stations_in_Ind...
If Indonesia uses thermal power then using the electricity generated from it has little negative environmental impact.
Additionally I'm unclear where anything is "making profits from cheap labor". The miner benefits from the low cost of living in Jakarta, but making that out to be a bad thing is like complaining that housing in Kansas isn't as expensive as New York.
Thermal as in burning fossil fuels, not geothermal.
Uh...Power in the US costs 30+ cents/kWh? In which part of the country??
In Ontario, Canada, the price is about 6.7 cents/kWh during the night and peaks at 12.4 cents/kWh in the afternoon.
http://www.ontarioenergyboard.ca/OEB/Consumers/Electricity/E...
Notably Tiyo Triyanto, the miner quoted in the opening paragraphs, is now mining Litecoin instead of Bitcoin and betting on prices increasing before the ASIC arms race starts for that cryptocurrency.
http://www.eia.gov/electricity/monthly/epm_table_grapher.cfm...
In the Europe the story is quite similar. The country with the most expensive electricity is Denmark at 29.5 but most vary between 10 and 20 cents.
http://www.energy.eu/
In the US power costs usually between 8-12 cents per kilowatt hour. There are extra costs if your commercial which can add 10-20%.
We've found that power cost, especially commercial power is oddly hard to estimate with "demand charges" and rates varrying with time... There are a few companies compiling this cost data in detail which we'll likely be buying soon.
Actually, our electricity in the SF Area is very expensive. I don't know why. One half of our power is from Dams. I think it's 1/2.
Actually, I think they charge us so much is because they know we will pay.
To all the Élon Musk fans, I wonder what your PG&E bill will be?
While I'm on this subject--yea, I'm an electrician, don't heat your house with elecrtic heaters. They will really eat up the kilowatts, and look into Radiant hydronic heating if updating. My bill is 1/4 of what it used to be. You can install yourself, if determined.
I had a studio in Paris that only had electric heat. 2 months after it started getting really cold I got the electric bill, $250. After that I shut off the heater at the breaker, bought a portable heater and a jug (20L) of kerosene for $80. That jug lasted 2 winters.
Oh, and that's a flat rate.
Here in NZ, I get a generation charge, a national lines charge, and a local lines charge per kwh. Then I've got an additional daily charge to be connected to the network. It works out to NZ$0.22/kwh.
Electricity isn't very useful when it's at the hydro lake!
[Edited to add numbers] Looking into it, Ontario power is:
(Peak 11AM-5PM) 12.4c/kWh generation. 3.37c/kWh distribution 1.21c/kWh transmission
$17.29/mo connection.
So, that's CDN16.98c/kWh delivered to a suburban home.
Still, nowhere near 30c/kWh.
400kWh is $127.93 or 32cents/kWh
Bitcoin difficulty has risen MASSIVELY lately.
Edit: Also, depending on how you want to look at it, the hour value is a bit off. $114/day * 7 days/week / 40 hours/week = $19.95.
From this calculator: http://dustcoin.com/, you need about 60,000 KH/S to make $114 a day (excluding power cost). One of the most efficient $/hashrate GPUs for litecoin mining is the ATI 7950 at about $210 a piece and ~600 KH/s. 105 * 600 KH/s = ~60000 KH/s = ~$114, so it works out. That's $20,000. So if you spend $20,000 you can buy yourself a job that pays $114 a day. It will take 6 months just to break even. Better hope the difficulty hasn't increased enough in that time to make your GPUs irrelevant (hint: it probably will).
Keep in mind that I was very generously excluding the very significant cost of power, the very significant cost of all the motherboards/cpu/ram/power supplies to run those GPUs, and the power and space required to cool them. Realistically we're looking at more like $50k.
>“Currently I’m making about 60 litecoin per day,” he said. “I’ve kept 95% of the mining profit since April and once the major exchanges start accepting LTC, others will follow, and price is expected to soar. So that 60 LTC could turn into $1,500.”
This is absurd. If he thinks 60 LTC will be worth $1,500, he should spend the $20,000 he spent on GPUs on LTC instead. He'd turn $20,000 into $250,000 with no work required (another hint: assuming you can turn $20k into $250k in 6 months with no work as a sure thing is also absurd).
He'd make far more money if he wrote an e-book on how to cram 105 GPUs into your apartment to mine BTC.
The only problem I see is the reliability of the electricity provider itself. There are frequent surges and parts of Jakarta are known to experience regular rolling blackouts.
This might pay off mining 60LTC per day and hoarding them. The guy who started Litecoin now works for Coinbase, which may adopt Litecoin and will no doubt start a gigantic speculation bubble this Indonesian dude can cash out with http://www.wired.com/wiredenterprise/2013/08/litecoin/
Mining is a business, many businesses are capital intensive.
I don't consider this a design flaw in the concept of money itself. The same goes for BTC.