Twenty miles northeast of Pittsburgh, in Russellton, Pennsylvania, is a waste coal pile, although “pile” isn’t really accurate. It’s actually huge mountains of black rock stacked as tall as houses that sit nearby–the site is in the middle of a residential area. There’re no trees or vegetation on the site, except for patches of grass here and there.
“And you can see here, yes, there is some grass,” said Bill Spence, pointing at the grass, “but it doesn’t totally cover it so that the coal is still exposed, and there are large patches and swatches of it.”
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Spence has worked in the waste coal industry for nearly three decades. He’s from a town along the Monongahela River, and he remembers growing up near a waste coal pile — even playing on top of it as a kid. He said he, his father, and his grandfather all had kidney cancer, which he suspects is from the environmental effects of these piles. “So you start connecting the dots on where I grew up,” he said.
So for Spence, remediating these sites is important. “What I try to do is really tell the story and humanize it so people can understand why these sites are here, the reason that they need to be removed and expose the environmental despair and degradation that these sites have caused,” he said.
Boen Wang interviews Bill Spence at the Scrubgrass power plant in April 2022. Photo: Kara Holsopple / The Allegheny Front
These piles are safety hazards for communities. Waste coal also causes environmental problems. Dust can blow from them, they can catch on fire and burn uncontrollably. Waste coal can also cause water pollution.
Spence is looking down at a stream of rust-colored water caused by metals leaching into the water from the waste coal pile, turning it acidic “You know, you’ll hear people talk about planting beachgrass on these sites. But it doesn’t mean that it’s taking care of the problem,” Spence said.
There’s a huge amount of waste coal throughout Pennsylvania. One estimate from an industry trade group put it at 2 billion cubic yards — almost 1,500 Empire State Buildings filled to the brim.
“It’s like America and the world had a party,” said Spence. “They used this material to make the steel to build their cities and their bridges and so forth. And they left all the waste material behind. It’s like we woke up the next morning and have to clean up the mess.”
Waste coal can be shipped to permitted landfills, and sites can be been regraded and planted with vegetation. Pennsylvania Department of Environmental Protection won an award at a Greene County site in 2016 that demonstrated covering a waste coal pile with soil and planting vegetation reduced water pollution, as well as erosion and sedimentation.
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Turning waste coal into Bitcoin
But for Spence, the best way to clean up the mess is to turn waste coal into electricity in specialized power plants.
He co-founded a company called Stronghold Digital Mining, where he is currently the co-chairman of the board of directors. Stronghold transports waste coal from the Russelton site and others to one of the power plants the company owns, the Scrubgrass power plant in Venango County. After the waste coal is combusted, ash that’s produced as a byproduct is returned back to waste coal sites, which the company says is part of the reclamation process.
The Scrubgrass plant is one of two waste coal plants Stronghold owns that fuels Bitcoin mining computers. In the second quarter, Stronghold took two-thirds of the miners offline. A third quarter report is due November 9. Photo: Kara Holsopple / The Allegheny Front
What makes Stronghold’s operations different from other waste coal power plants is Bitcoin. Last year, Stronghold Digital Mining raised money to start Bitcoin mining at Scrubgrass. Stronghold also runs Bitcoin mining at its Panther Creek waste coal plant in eastern Pennsylvania.
When The Allegheny Front visited the Scrubgrass plant in April, shipping containers outside the plant were filled with stacks of computers called Bitcoin miners, fans whirring at full speed.
Bitcoin is a virtual currency that’s worth a very real amount of money. In April, one Bitcoin was worth over $41,000.
A modified shipping container contains computers that mine Bitcoin at the Scrubgrass power plant, in April 2022. Photo: Kara Holsopple / The Allegheny Front
To mine Bitcoin, computers all over the world compete to solve the same complicated math problem. If you solve the math problem first, you win—and receive one bitcoin. All these high-powered computers use a lot of electricity.
Data center manager Chris Radwanski explained that the electricity the plant generates can switch between powering the Bitcoin miners, and going out to the grid.
“When the grid needs it, the data center comes offline, and all that power that was going to the data center switches to the grid,” said Radwanski. “And when the grid doesn’t need it, it switches again and comes back to the data center.”
This means the plant can run continuously, which means more waste coal can be removed from waste coal piles.
In the second quarter of this year, Stronghold Digital Mining reported that it removed about 240,000 tons of waste coal.
But this summer, the cryptocurrency market crashed, and Bitcoin’s value is now less than half of what it was in April. Fortune Magazine reported that during the second quarter, Stronghold also yielded a net loss of $40 million and that the company has taken two-thirds of its Bitcoin miners offline.
The company says it expects to sell most of its power to the grid, at least in the near term. Its third quarter 2022 earnings conference call is scheduled for November 9.
Waste coal’s climate footprint
Stronghold’s website says the company is “actively improving the environment,” and that its plants are equipped with air pollution controls that remove sulfur dioxide, nitrogen oxides, and mercury emissions, among other pollutants.
But waste coal plants produce carbon dioxide. Last year, the Scrubgrass plant generated nearly half a million tons of CO2. That amount of carbon is equivalent to almost 100,000 cars on the road over the course of an entire year.
To address this issue, Tiffany Duffy, vice president of business development at Stronghold, says it wants to use carbon capture technology.
“It’s part of our mission to mitigate that and eliminate that. And we are in the process of coordinating with a number of different groups and technologies to put that in place here,” said Duffy.
She’s talking about carbon capture. That technology hasn’t lived up to its promise yet, but the Inflation Reduction Act, the huge climate bill signed into law in August, is incentivizing these types of projects with an expanded tax credit.
Overall, Mike Ewall, director of the Energy Justice Network, says there’s a built-in carbon problem with waste coal.
Waste coal is a much dirtier fuel than normal coal because you’re burning half rock,” said Ewall. “And because of that, you have to burn a lot more of it to get the same amount of energy.”
According to Ewall’s calculations from state and federal data, burning waste coal produces 36% more CO2 than standard coal.
Future of waste coal remediation
Like the rest of the coal industry, waste coal plants are struggling because of cheaper energy from natural gas and renewables. A third of Pennsylvania’s 15 waste coal plants have closed down over the past decade, according to Jaret Gibbons, a former state representative and current executive director of a waste coal industry group called ARIPPA.
“I don’t think that the intention was ever that you were going to see these facilities competing in the open market,” he said.
As a state representative, Gibbons sponsored a 2016 law that has allotted tens of millions of dollars in tax credits for waste coal plants. He said these plants were never meant to be economically viable without these taxpayer-funded subsidies.
“The reality was that the mission of these facilities was always to do the mine land reclamation,” he said.
Waste coal plants are also included in Pennsylvania’s Alternative Energy Portfolio Standard as Tier II energy sources, making these facilities eligible to earn renewable energy credits.
Tom Schuster, the interim chapter director of Sierra Club Pennsylvania, says the state has to take an honest look at the pros and cons of burning waste coal for power, now that the calculus has changed: The Bipartisan Infrastructure Law is sending $4 billion to Pennsylvania over the next 15 years for abandoned mine reclamation.
“There’s quite a bit more money now,” Schuster said. “I think that we need to be developing a process and a plan for how we as a state solve the problem of abandoned mine lands once and for all.”
With the windfall, the DEP said in an email that it’s expanding and developing new efforts to clean up abandoned mine lands, including those giant piles of waste coal.
Update 11/10/22: In its third quarter 2022 report, Stronghold reported a net loss of $49.6 million. It also reported that it “received or procured approximately 10,000 additional Bitcoin miners,” and that both power plants had planned outages for scheduled maintenance from September into October. For the quarter, the company removed 241,000 tons of coal refuse, and returned approximately 168,000 tons of “beneficial use” ash to waste coal sites for remediation. It attributed a 61% increase in its energy revenue from the second quarter to selling more power to the grid.
