Senator Cynthia Lammis released a report attacking Biden’s mineral tax

In the year On July 23, Senator Cynthia Lammis released a report challenging the Biden administration's proposed 30% excise tax on the energy used by Bitcoin miners.

The report, titled Why the Bitcoin Mining Tax Will Hurt America , brought the Bitcoin (BTC) mining industry into the spotlight, highlighting the benefits of critical mining infrastructure to the United States energy grid.

Lummis cites the Bitcoin Energy and Emissions Sustainability Tracker as evidence that Bitcoin mining is cleaner than commonly thought, suggesting that up to 52.6% of BTC mined may be emission-free.

The pro-crypto senator then turned her attention to the increasing role of Bitcoin mining facilities in securing the power grid. Mining facilities represent large and variable electrical loads that are used to balance and redistribute power to electrical grids in times of crisis.

No other example illustrates this more than the struggle between the Electric Reliability Council of Texas (ERCOT) and Bitcoin miners to stabilize power grids. The GOP lawmaker explained that by 2022, bitcoin miners could sell 1,500 megawatts of power to the grid during periods of peak demand. A similar pattern played out in 2024, when Bitcoin mining infrastructure was damaged by winter storm Heather as a control load source for the Texas grid.

Related: Bitcoin mining to boost UK renewable energy grid.

A 30% tax would hurt the environment regulators say they expect.

A Wyoming senator explained that a 30% excise tax on Bitcoin miners would discourage them from finding sustainable forms of energy and new energy recycling techniques. Although Lummis gives the example of extracting methane from landfills into bitcoins, similar examples can be seen in El Salvador, where the government used volcanic power to extract 474 bitcoins.

Another example of energy efficiency started by Bitcoin mining is that an entire community of 11,000 individuals in the Satakunta region of Finland is heated by the superheat produced by the Marathon digital mining facility.

The mining giant signed an agreement with the Kenyan government earlier this year to further develop the country's renewable energy sector.

Laffer's curve gets the last laugh

Lummis concluded her report by arguing that increasing taxes on Bitcoin miners would drive the industry out of the United States and reduce much-needed tax revenue. This inverse relationship between tax rates and tax revenue is known as the Laffer Curve.

The senator pointed out that this had already happened in China. The 2021 mining ban would have wiped out the once-thriving mining industry.

Before the ban, Chinese miners controlled most of the Bitcoin network hashrate.

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