Company: SLNH
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001641172-25-001756
Chunk: 10

Company: Soluna Holdings, Inc
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1
Chunk 10
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surety found our data centers are 18% greener than traditional data centers. This is driven by our flexible design, our
MaestroOS software platform, and our location on the grid close to renewable resources.

We participate in ERCOT emergency demand response
programs, which allows the grid to redirect our power allotment back into the market during extreme weather events when needed. By taking
such actions, we immediately help to stabilize the grid by allowing our power allotment to be delivered to the areas of greatest need,
such as heating homes and powering hospitals. Overall, our operations incentivize the development of new renewable power generation,
and they help to reduce the frequency and impact of power failures and electricity price surges. 

The use of water in data centers has become a central
concern in recent years. We aim to develop data centers that reduce their water consumption using the latest in direct liquid cooling
technology and advanced HVAC systems that rely less on the evaporation of water.

In addition to our low-carbon execution strategy,
we also monitor climate change legislation, regulation, and international treaties for any material effect on our business and the markets
we serve.

Existing or Potential
Governmental Regulations

Cryptocurrency
mining remains largely unregulated at the federal and state levels; however, we anticipate increased regulatory attention over the near
and long term. The impact of future regulatory changes on our operations is uncertain and may vary by jurisdiction.

A
substantial portion of our operations, including our Project Dorothy facilities, are located in Texas, which has historically maintained
a favorable regulatory environment for digital asset mining. In March 2022, ERCOT began requiring large-scale digital asset miners to
apply for interconnection approval. Subsequently, in April 2022, ERCOT established a task force to develop policy recommendations for
integrating large flexible loads, including Bitcoin mining operations, into the ERCOT market. This process has caused energization delays
for some market participants, and we may experience similar impacts in the future.

At
the federal level, regulatory momentum continues to evolve. In January 2024, the SEC approved a
series of spot Bitcoin exchange-traded funds (ETFs), which have since attracted substantial investment. In February 2024, the U.S. Energy
Information Administration (EIA) initiated a six-month survey to collect data on electricity usage within the cryptocurrency mining sector.
The stated aim was to assess geographic growth trends and energy sourcing. Following a lawsuit, the U.S. Department of Energy suspended