Crypto-Asset Environmental Transparency Act of 2022
Bill: S.5210 | Sponsor: Sen. Markey, Edward J. (D-MA)
Policy area: Environmental Protection

Summary:
Crypto-Asset Environmental Transparency Act of 2022
This bill establishes greenhouse gas emission reporting and related requirements for certain crypto-asset (e.g., Bitcoin) mining operations.

To require an interagency study on the environmental and energy impacts 
 of crypto-asset mining, to assess crypto-asset mining compliance with 
               the Clean Air Act, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Crypto-Asset Environmental 
Transparency Act of 2022''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) human activity is the dominant cause of observed 
        climate change in the past century;
            (2) climate change is increasing the frequency and 
        intensity of wildfires, droughts, severe storms, heat waves, 
        rising of sea levels, and severe weather events;
            (3) the Federal Government has--
                    (A) committed under the decision of the 21st 
                Conference of Parties of the United Nations Framework 
                Convention on Climate Change, adopted in Paris, France, 
                December 12, 2015 (commonly referred to as the ``Paris 
                Agreement''), to reduce greenhouse gas emissions by 50 
                to 52 percent by 2030; and
                    (B) a responsibility to mitigate current and future 
                impacts of climate change to protect the health, 
                safety, and welfare of individuals of the United 
                States;
            (4) crypto-asset mining operations--
                    (A) can be energy intensive; and
                    (B) unlike most other technologies, are often 
                designed to generally increase computing requirements 
                over time, which can lead to increased energy 
                consumption;
            (5) a crypto-asset network, Bitcoin, consumes more energy 
        annually than countries such as Chile or Bangladesh consume;
            (6) crypto-asset mining operations often rely on fossil 
        fuels for power, which contributes to greenhouse gas emissions;
            (7) the carbon dioxide emissions of the United States from 
        Bitcoin mining were estimated at 21 to 35 megatons per year in 
        2022, which is equivalent to the annual emissions from more 
        than 4,500,000 to 7,500,000 gasoline-powered cars driven for 1 
        year;
            (8) crypto-asset mining can also cause local noise and 
        water pollution;
            (9) the number of crypto-asset mining facilities in the 
        United States is increasing, and the share of the United States 
        of global Bitcoin mining rose from 3.5 percent in 2020 to 38 
        percent in 2022;
            (10) crypto-asset mining is an emergent industry, and the 
        potential of crypto-asset mining to exacerbate systemic racial, 
        social, environmental, and economic injustices is not 
        sufficiently understood;
            (11) there is no comprehensive, independent study of 
        crypto-asset mining operations in the United States, including 
        the energy use, resource mix, and greenhouse gas emissions of 
        those crypto-asset mining operations; and
            (12) one of the primary recommendations of the report of 
        the Office of Science and Technology Policy entitled ``Climate 
        and Energy Implications of Crypto-Assets in the United States'' 
        and dated September 2022 was to obtain detailed data on energy 
        use and emissions from crypto-asset activity.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Administrator.--The term ``Administrator'' means the 
        Administrator of the Environmental Protection Agency.
            (2) Air pollutant.--The term ``air pollutant'' has the 
        meaning given the term in section 302 of the Clean Air Act (42 
        U.S.C. 7602).
            (3) Block.--The term ``block'' means a group of data stored 
        as a single record in a blockchain.
            (4) Blockchain.--The term ``blockchain'' means a 
        distributed ledger technology in which--
                    (A) the data are shared across a network that 
                creates a digital ledger of verified transactions or 
                information among network participants; and
                    (B) the data are typically linked using 
                cryptography to maintain the integrity of the ledger 
                and execute other functions, including transfer of 
                ownership or value.
            (5) Consensus mechanism.--The term ``consensus mechanism'' 
        means a process to achieve agreement among network participants 
        on the current state of a blockchain.
            (6) Crypto-asset.--The term ``crypto-asset'' means a 
        digital asset, which may be a medium of exchange, a 
        representation of value, or both, for which generation or 
        ownership records of the digital asset are recorded in a 
        distributed ledger technology that relies on cryptography.
            (7) Crypto-asset mining.--The term ``crypto-asset mining'' 
        means the process of performing computations to add a valid 
        block of data to the blockchain, typically in exchange for a 
        reward or fee.
            (8) Power load.--The term ``power load'' means the amount 
        of electrical power, in megawatts, that can be consumed by a 
        qualifying crypto-asset mining operation.
            (9) Qualifying crypto-asset mining operation.--The term 
        ``qualifying crypto-asset mining operation'' means--
                    (A) an individual crypto-asset mining facility that 
                has a power load that is greater than or equal to 5 
                megawatts; or
                    (B) multiple crypto-asset mining facilities that--
                            (i) are owned by the same company; and
                            (ii)(I) each have a power load that is less 
                        than 5 megawatts; but
                            (II) have a cumulative power load that is 
                        greater than or equal to 5 megawatts.
            (10) Scope 1 emissions.--The term ``scope 1 emissions'' 
        means greenhouse gas emissions directly from sources that are 
        operated, controlled, or owned by an individual or entity 
        performing a qualifying crypto-asset mining operation.
            (11) Scope 2 emissions.--The term ``scope 2 emissions'' 
        means indirect greenhouse gas emissions associated with the 
        purchase of electricity, steam, heat, or cooling by an 
        individual or entity performing a qualifying crypto-asset 
        mining operation.
            (12) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.

SEC. 4. COMPLIANCE WITH THE CLEAN AIR ACT.

    (a) Rulemaking Required.--
            (1) Proposed regulation.--Not later than 1 year after the 
        date of enactment of this Act, the Administrator shall issue a 
        notice of proposed rulemaking to revise part 98 of title 40, 
        Code of Federal Regulations (as in effect on the date of 
        enactment of this Act)--
                    (A) to require qualifying crypto-asset mining 
                operations to report as covered facilities under 
                subpart A of that part;
                    (B) to add a new subpart to that part that includes 
                qualifying crypto-asset mining operations as a source 
                category;
                    (C) to include in the new subpart created under 
                subparagraph (B) appropriate calculation methodologies, 
                reporting guidelines, and monitoring operations of, 
                with respect to qualifying crypto-asset mining 
                operations, scope 1 emissions and scope 2 emissions; 
                and
                    (D) to designate the qualifying crypto-asset mining 
                operations source category established pursuant to 
                subparagraph (B) as a source category that is subject 
                to greenhouse gas reporting requirements and related 
                monitoring, recordkeeping, and reporting requirements 
                under section 98.2 of that title, regardless of whether 
                a qualifying crypto-asset mining operation emits at 
                least 25,000 metric tons of carbon dioxide-equivalent.
            (2) Final rule.--Not later than 180 days after the date on 
        which the public comment period on the proposed rule under 
        paragraph (1) closes, the Administrator shall issue a final 
        rule revising part 98 of title 40, Code of Federal Regulations.
    (b) Assessment.--Not later than 1 year after the date on which the 
Administrator finalizes the rule required under subsection (a), the 
Administrator shall, pursuant to section 114(a) of the Clean Air Act 
(42 U.S.C. 7414(a)), issue requests for information for the purpose of 
conducting an assessment of, with respect to qualifying crypto-asset 
mining operations, the permit programs under the Clean Air Act (42 
U.S.C. 7401 et seq.), which shall include identifying the extent to 
which any qualifying crypto-asset mining operations are improperly 
operating without a valid and current permit under that Act.
    (c) Authorization of Appropriations.--There is authorized to be 
appropriated to the Administrator to carry out this section $5,000,000 
for fiscal year 2023, to remain available until expended.
    (d) Savings Provision.--Nothing in this section limits the ability 
of the Administrator to require the reporting of emissions of any type 
in another source category.

SEC. 5. IMPACT STUDY.

    (a) In General.--Not later than 1 year after the date of enactment 
of this Act, the Administrator, in consultation with the Secretary, the 
Administrator of the Energy Information Administration, the Federal 
Energy Regulatory Commission, and the head of any other Federal agency 
the Administrator or the Secretary determines appropriate, shall 
conduct a study on the environmental impacts of crypto-asset mining in 
the United States.
    (b) Study Requirements.--The study required under subsection (a) 
shall include--
            (1) the number and location of any existing or planned 
        qualifying crypto-asset mining operation;
            (2) the amount of greenhouse gas emissions and other air 
        pollutants that are--
                    (A) released by an onsite energy source; and
                    (B) attributable to offsite-generated electricity, 
                steam, heat, or cooling provided to a qualifying 
                crypto-asset mining operation;
            (3) the anticipated increase of new, and expansion of 
        existing, qualifying crypto-asset mining operations;
            (4) the potential impacts of electric energy consumption by 
        qualifying crypto-asset mining operations, including by 
        prolonging the use of fossil fuel generators, on the ability of 
        the United States to achieve the greenhouse gas emission 
        reductions necessary to keep global warming below 1.5 degrees 
        Celsius compared to pre-industrial levels;
            (5) the ecological impacts, including ecological impacts 
        associated with electronic waste generation and the use or 
        discharge of cooling water, caused by qualifying crypto-asset 
        mining operations;
            (6) the potential public health impacts due to the reduced 
        air and water quality and increased water stress on communities 
        near qualifying crypto-asset mining operations;
            (7) the potential public health impacts from greenhouse gas 
        emissions released by qualifying crypto-asset mining 
        operations;
            (8) the potential public health and ecological impacts from 
        noise generated by qualifying crypto-asset mining operations;
            (9) the amount of electric energy consumed by each 
        qualifying crypto-asset mining operation, including the time of 
        use of electricity and the potential grid stress posed by the 
        power load of the qualifying crypto-asset mining operation;
            (10) the source of electric energy consumed by each 
        qualifying crypto-asset mining operation;
            (11) the aggregated energy-use statistics and greenhouse 
        gas emissions statistics for qualifying crypto-asset mining 
        operations in the United States;
            (12) an analysis of energy use and greenhouse gas emissions 
        by type of consensus mechanism;
            (13) an analysis of demand-response programs negotiated 
        between qualifying crypto-asset mining operations and electric 
        utilities;
            (14) an analysis of potential rate-design measures that 
        could be implemented by State and local regulators to reduce 
        the energy consumption and dependence on fossil fuel energy 
        sources of crypto-asset mining operations;
            (15) a geospatial assessment of the extent to which crypto-
        asset mining operations are located within environmental 
        justice communities, as defined by the Administrator or within 
        the Climate and Economic Justice Screening Tool of the Council 
        on Environmental Quality; and
            (16) an identification of, and recommendations for, best 
        practices for data types, data sources, and methodologies for 
        accurately measuring, modeling, and tracking the environmental 
        impacts of crypto-asset mining operations in the United States 
        in the future.
    (c) Public Comment.--Before conducting the study required by 
subsection (a), the Administrator shall provide an opportunity for 
public comment and advice relevant to conducting the study.
    (d) Report to Congress.--Not later than 18 months after the date of 
enactment of this Act, the Administrator shall submit to the Committees 
on Energy and Commerce and Science, Space, and Technology of the House 
of Representatives and the Committees on Environment and Public Works 
and Energy and Natural Resources of the Senate, and publish on the 
public websites of the Environmental Protection Agency and the 
Department of Energy, a report that contains the results of the study 
required by subsection (a).
    (e) Authorization of Appropriations.--There is authorized to be 
appropriated to the Administrator to carry out this section $5,000,000 
for fiscal year 2023, to remain available until expended.

SEC. 6. ENERGY EFFICIENCY OF DATA CENTER BUILDINGS.

    Section 453(a)(1) of the Energy Independence and Security Act of 
2007 (42 U.S.C. 17112(a)(1)) is amended--
            (1) in subparagraph (A), by striking ``or'' at the end 
        after the semicolon;
            (2) in subparagraph (B), by striking the period at the end 
        and inserting ``; or''; and
            (3) by adding at the end the following:
                    ``(C) a facility in which 2 or more computers 
                perform logical operations to mine or create crypto-
                asset (as defined in section 3 of the Crypto-Asset 
                Environmental Transparency Act of 2022).''.
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