Does Bitcoin Waste Energy?

On May 12, 2021, Elon Musk announced that Tesla would stop accepting bitcoin as payment for its cars. "We are concerned about rapidly increasing use of fossil fuels for Bitcoin mining and transactions," he wrote, "especially coal, which has the worst emissions of any fuel."¹

For a lot of people, that sentence is still most of what they know about Bitcoin: it burns a lot of electricity. That part is true, and anyone who tells you otherwise is not being straight with you. But Musk's sentence holds two different claims. One is that mining uses energy, which is correct. The other is that transactions use energy, which is the misunderstanding at the root of most of the argument. Pulling those two apart is the best way to answer the question honestly.

How Much, Honestly

One of the most careful public estimates comes from the Cambridge Centre for Alternative Finance at the University of Cambridge. In April 2025 it put Bitcoin's electricity use at about 138 terawatt-hours a year, as of mid-2024, which is roughly half of one percent of all the electricity the world consumes.² Put another way, about one kilowatt-hour in every two hundred generated on Earth was going to Bitcoin mining.

That number has grown since. Between June 2024 and October 2026, the computing power securing the network rose by about 75 percent.³ Newer mining machines do more work for each kilowatt-hour than the ones they replace, so electricity use grows more slowly than computing power does, but today's figure is almost certainly higher than Cambridge's. That is real electricity, and it deserves a real answer.

A Lighthouse, Not a Meter

Here is where the "transactions" half of the sentence goes wrong. Bitcoin's energy is spent on mining, and mining works like a lottery. Machines around the world make guesses as fast as they can, and each guess costs a sliver of electricity. About every ten minutes, one of them finds a winning answer, adds the next block of payments to the ledger, and collects a reward. Then the race starts over.

A block can hold a handful of payments or several thousand of them. Blocks mined in late October 2026 held between about 5,300 and 7,900 transactions each.³ Either way, the winning answer was exactly as hard to find. If twice as many people sent bitcoin tomorrow, mining would not use twice the electricity. It would not use any more at all.

You may have seen figures that say a single Bitcoin transaction uses as much electricity as an American household does in weeks. One widely quoted tracker puts it at about 744 kilowatt-hours, or about 25 days of a typical household's use.⁴ That figure comes from dividing the network's total electricity by the number of transactions. The arithmetic is correct, but it describes a ratio, not a cost. Think of a lighthouse. It burns the same power whether two ships pass in the night or two hundred. Dividing its electric bill by the number of ships tells you something about a slow night. It does not tell you what one more ship costs, because one more ship costs nothing.

The ratio misleads in another way too. A single Bitcoin transaction can pay hundreds of people at once, which is how exchanges often send withdrawals. And systems built on top of Bitcoin, like the Lightning Network, can settle a long run of small payments with a couple of transactions on the main ledger.

What Sets the Size of the Bill

If the number of payments doesn't decide how much energy Bitcoin uses, what does? The reward does.

Since April 2024, each block has paid its miner 3.125 new bitcoin, plus the fees attached to the payments inside it. At about 144 blocks a day, that is roughly 450 new bitcoin every day. At an illustrative price of $100,000 per bitcoin, the new coins alone are worth about $45 million a day. Miners compete for that prize, and as long as the prize is worth more than the electricity and machines it takes to win it, more miners join. When the prize shrinks, the least efficient machines switch off.

So Bitcoin's electricity use is not a fixed cost per user. It is a market's running answer to a single question: how much is the reward worth? That has an interesting consequence. The new-coin part of the reward is cut in half about every four years, with the next cut expected in 2028. Over the long run, the energy spent on Bitcoin will depend on how much people are willing to pay in fees, a shift covered in more detail in our article on the halving.

What the Electricity Buys

Whether something is wasted depends on whether what it buys is worth having. The electricity in Bitcoin buys one thing above all: it makes the past expensive to change. Every block is sealed with the work that went into finding it, and every block after it is stacked on top. To reverse a payment that is already buried, an attacker would have to redo that work, and all the work after it, faster than every honest miner on Earth combined. The energy is what turns "please don't rewrite the ledger" into "you can't afford to."

That is why the word "waste" is doing so much work in this debate. It is the word we use for energy spent on something we don't think is worth it. People who believe Bitcoin serves no purpose will call any amount of electricity waste, and from where they stand that is a consistent position. People who believe a money that no one can print, freeze, or quietly rewrite is worth having will compare its cost to the cost of guarding every other kind of money. You do not have to settle that to see that the disagreement is about value, not physics.

Concerns Worth Taking Seriously

Several concerns hold up, and they deserve a fair hearing.

The first is the fuel. Musk's worry about coal was well founded in 2021. Cambridge's 2025 study found coal had fallen to 8.9 percent of mining's electricity, down from 36.6 percent in 2022. It also found 52.4 percent came from sustainable sources: 42.6 percent from renewables such as hydropower and wind, and 9.8 percent from nuclear.² That still leaves natural gas at 38.2 percent, so close to half of Bitcoin's electricity is fossil fuel. And Cambridge's survey covered just under half of global mining, so other researchers reach different numbers.

The second is the neighbors. Mines are industrial buildings full of machines and cooling fans, and the people living next to them carry costs the rest of us don't. In October 2024, residents near a mine outside Granbury, Texas, sued its operator, Marathon Digital, saying the constant hum from its cooling fans was causing them physical and psychological harm. Marathon rejected the allegations, said its sound levels were within legal limits, and said it was building a sound wall and switching part of the site to quieter liquid cooling.⁵ Whatever a court decides, the people in Granbury are a reminder that "where the energy comes from" includes where the buildings go.

Both concerns are about how mining is done and where, which can change, rather than about whether the network should spend energy at all, which is built into how it works.

The Part That Surprises People

Bitcoin mining also has an unusual relationship with power grids. It is a customer that can switch off within minutes when everyone else needs the power, and it can be built next to energy that has no other buyer. That is where the debate gets most interesting, and Lesson 8 of the course goes there, with the numbers on both sides. Why a money that can't be printed at will is worth spending anything on in the first place is the question the free first lesson begins with.