By a 5-1 vote Tuesday evening, the Bulloch County Board of commissioners gave conditional-use permission for a cryptocurrency “mining” facility to be placed near the intersection of Georgia Highway 119 and the 119 Spur, across from Mud Road southeast of Stilson.
It won’t be a literal mine dug into the ground, but a big collection of banked server-like computers inside steel pods, like shipping containers, on concrete foundations surrounded by a gravel pad. The computers mine data to verify transactions made with encrypted digital currencies such as Bitcoin. The racks of computers generate a lot of heat and so have many cooling fans, which make continuous noise, a fact not lost on a few neighbors who have expressed opposition, or on state Rep. Jan Tankersley, R-Brooklet, who wanted the commissioners to at least study the issue further.
Ironically, the commissioners by a unanimous vote during the same meeting rejected a conditional use request for a literal surface mine, a “sand pit,” at a different location. But that actual mine, which will be the subject of a separate story, drew a larger number of citizens who signed up in opposition. It had also received a recommendation for denial from the appointed Planning and Zoning Commission, or zoning board. In contrast, the zoning board recommended approval for the cryptocurrency mine twice, on 3-1 and 4-1 votes for two slightly different sites, both near the Highway 119 intersection in an AG-5 agricultural zone.
Excelsior Electric Membership Corporation, based in Metter, actually presented both sites, which were identified by the names of the property owners. The first site, which came before the zoning board in July, was the almost 5.5-acre grounds of the existing power substation owned by Georgia Transmission Corporation, which is in turn owned by 38 electric membership corporations, or EMCs, including Excelsior.
The cryptocurrency facility would have occupied roughly one acre immediately adjacent to the substation. But Excelsior EMC also obtained an option to buy a 5-acre, L-shaped tract bordering the substation on two sides from property owner John Cone. After a few neighbors expressed concerns about the noise in July, Greg Proctor, CEO of Excelsior EMC, told some of the neighbors and the Statesboro Herald that this alternative site could provide more room for barriers or other sound buffering.
The zoning board heard that proposal in August. Both sites then appeared on the commissioners’ agenda Tuesday, but Proctor and county Planning and Development Director James Pope noted that the Cone site was the one Excelsior was now pursuing. So the commissioners acted only in regard to that property.
“We have a customer who wants to install a cryptocurrency processing operation at this site,” Proctor told the commissioners. “This customer will make a substantial investment in equipment that will be installed at the site, and this operation will use a lot of power. It is estimated that the combined ad valorem tax and sales tax revenue from the operation will result in tax revenues for Bulloch County in excess of $400,000 (annually).”
He noted that the site “will only employ a few workers who will maintain the computer equipment and facilities” but argued that this means “the tax revenue produced will not place a burden on law enforcement, traffic or schools for Bulloch County.”
For LN Mining
As previously reported, Excelsior EMC would not operate the facility but is securing the site for a company, or group of companies, called LN Mining. Ten apparently related, limited liability companies, LN Mining 1 LLC through LN Mining 10 LLC, are registered with the Georgia Secretary of State’s Office. The first seven have the same Duluth address and registered agent, Jian Jun Yao. The last three share a Swainsboro address and list Registered Agents Inc. as their agent.
The Bulloch County site would be the first cryptocurrency mining operation served by Excelsior EMC. But Altamaha EMC provides power to LN Mining’s cryptocurrency center at Swainsboro in Emanuel County. Bulloch County officials, including commissioners, visited that site earlier this year.
In preparation for Excelsior EMC’s request and potential further interest, the zoning board and staff proposed, and the commissioners on June 7 adopted, a zoning ordinance amendment to allow cryptocurrency mining operations as conditional uses in Ag-5, Light Industrial and Heavy Industrial zones.
The amended ordinance sets specific limits on the intensity of sound crypto data centers can generate. Excelsior EMC directed the county staff to an audio engineering consulting firm with experience with these facilities.
How the sound levels are to be checked and allowed variations for frequency ranges are spelled out in the ordinance. But the general rule is that the continuous sound level measured 100 feet from a home must not exceed 50 decibels during the day or 45 decibels at night.
“Our customer is aware of these limitations and intends to fully comply with them,” Proctor said Tuesday. “They’re also aware that if the noise emitted by the cryptocurrency operation exceeds the level in the ordinance that they cannot operate until they come into compliance with the ordinance.”
Board of Commissioners Chairman Roy Thompson stated that Proctor and anyone else speaking in favor the zoning request would have a combined total of 10 minutes for remarks. Thompson also gave those who would speak against the request a total of 10 minutes.
Three people had signed up to speak in opposition. However, Thompson gave no reminders while one speaker, Carol Williams, used the entire 10 minutes.
“Basically, Bitcoin has no value at all,” Williams said. “Promoters claim that cryptocurrency is valuable as a means of payment, a store of value and-or a thing in itself. However, it’s accepted almost nowhere, and some cryptocurrencies, nowhere at all.”
She went on to cite a study predicting that the heat from cryptocurrency mining equipment could significantly increase global temperatures, to criticize the high electricity demand at a time when other customers are encouraged to conserve, and to note complaints about facilities in other states.
“These facilities also generate nonstop noise from the computers as well as the cooling equipment,” Williams said, but then noted that the sound levels depend on their size.
The one proposed here is rated at 10 megawatts, which county officials have noted is only a fraction of the power consumption of some cryptocurrency mining operations.
But a 10-megawatt data center operating at maximum power would use 10,000 kilowatt-hours of electricity in 60 minutes. The average home’s monthly consumption in 2020 was 893 kilowatt-hours nationwide and 1,081 kilowatt-hours in Georgia, according to U.S. Energy Information Administration reports, at www.eia.gov.
After Williams spoke, the Statesboro Herald learned that Tankersley, the District 160 state representative, had been one of the other two people who signed up, and obtained a copy of her prepared remarks.
She would have begun by noting that her state position has no power over local decisions but said she believes constituents could be adversely affected. In fact, she was a Bulloch County commissioner for 10 years before her 12 years as a state representative, a role she is retiring from at the beginning of 2023.
Tankersley wanted to ask the commissioners to slow down and consider three “lingering issues.”
First, she would have urged them to find answers to why China and eight other countries banned cryptocurrency mining, and she said, why 30 other countries have imposed severe limitations.
“From my vantage point, if it isn’t good enough for China, then it is definitely not good enough for Bulloch County,” Tankersley wrote.
Second, she wanted to urge the commissioners “to hear real testimony from real Georgians about the impact these same decisions have had in other areas of the state and even in other states.”
Third, she was going to urge the county to have an “independent auditor” establish a baseline noise level, in order to compare background noise to that created by the facility, and to have noise audits publicly reported weekly and provide a penalty for non-compliance.
Commissioners didn’t hear that before their vote, but they heard a recording of noise at the Swainsboro cryptocurrency mine from a brief video Thompson made on a repeat visit. The sound was a shrill, loud, grinding whir when he walked 30-plus feet behind the fans but softened a little when he passed the end of the pods.
“If I had to live by that, I would not want to live by it, I would not want it by my house,” Thompson said.
But he observed that some of the commissioners had asked whether the facility could be enclosed in a building. Thompson also noted that he does not vote, true except when a tiebreaker is needed.
While not requiring a building or enclosure at the outset, commissioners indicated they will rely on enforcement of their ordinance.
“We went through a lot of research on this thing, what it stipulates for the decibel meters, what it’s going to mean,” said Commissioner Timmy Rushing. “I think everybody in the room understands that (if it doesn’t meet that) it would be shut down until they put it in a building, put some walls up or whatever it takes for them to come into compliance.”
He made the motion for approval, which was seconded by Commissioner Walter Gibson. Commissioner Anthony Simmons cast the one “no” vote.