Town of Torrey, Greenidge Generation sued over possible effects on Lake Seneca

Three environmental groups and 30 individuals are seeking a court injunction to block the construction or operation of a Bitcoin data mining facility at Greenidge Generation power station.

The Sierra Club, the Committee to Keep the Finger Lakes, the Seneca Lake Guardian and others filed an Article 78 petition Thursday in Yates County Supreme Court against Greenidge Generation LLC, the Town of Torrey and the Torrey Planning Board.

The petitioners allege that the proposed expansion of Bitcoin mining will create more damaging warm water discharges to Seneca Lake.

Greenidge, a power plant fueled by natural gas, has state licenses to provide power to the electricity grid during periods of peak demand. But due to light demand in recent years, the factory has only operated at intervals and well below its production capacity.

Starting in early 2019, the factory began processing bitcoin transactions with on-site data tools that draw on plant-generated power that never reaches the grid. State officials say energy-intensive activity does not violate its state licenses.

Earlier this year, Greenidge applied to the Town of Torrey to significantly expand the bitcoin data center by adding four new buildings to house computers and cooling equipment. The company has said it expects that future bitcoin processing demand will allow the factory to operate to its full, full-time capacity.

An Article 78 petition alleges that Torrey officials violated the State Environmental Quality Review Act by reducing the environmental consequences of the proposed expansion. They have given their approval without the need for a full environmental impact statement, or EIS.

“Greenidge sought approval for this project through two separate but interdependent approval applications, thereby sharing their application for approval,” the petition said.

In granting its first approval in October 2019, the Torrey Planning Board approved for data center operations within the existing power station as a “Type 1” project under SEQRA. Although Type 1 actions are “likely to require an EIS,” the Planning Board concluded that the project would have “no significant impact on the environment” and surrendered the EIS.

Months later, Greenidge sought additional approval from the Torrey Planning Board to erect the four buildings. The petition alleges that the Planning Board improperly designated the second project as an “unlisted act,” which under SEQRA rules is “less likely than Type 1 projects” to have a significant environmental impact. Again, the EIS was omitted.

SEQRA regulations require any project that uses more than 2 million gallons of water per day to be designated a Type 1 project. Greenidge’s DEC license allows it to abstract nearly 160 million gallons per day.

An Article 78 petition alleges that the Planning Board decided that it was not required to “look carefully at the need for additional water to cool the heavily heated generating station and discharge to Lake Seneca.”

Most of the 30 individuals who signed the petition referred to the negative impact of the plant’s warm water discharges – killing fish and increasing the likelihood of harmful algal blooms, or HABs, where they enjoy swimming and boating.

For example, Linda and Phil Bracht said their “daily use and enjoyment of Seneca Lake is diminishing and their health could be harmed” by Greenidge’s extended bitcoin mining operations. Their property is on the lakefront on Arrowhead Beach Road just north of the Keuka Outlet, where heated Greenidge discharge water flows into the lake.

Eileen Moreland, a neighbor of the Brachts, claimed damage to her “home activities (including drinking, washing, laundry, tooth brushing), swimming, kayaking, fishing and other water sports.”

Many of the petitioners also complained that they expect a significant increase in the noise they are already hearing from the plant.

The petition, filed by Buffalo attorney Richard Lippes, alleges that the Planning Board deferred receipt of noise data until after granting project approval, an alleged violation of SEQRA.

The town and Greenidge have not filed formal responses to the petition, but the company submitted a lengthy defense of its application process to the Torrey Town Board on Oct. 13.

“Despite what some people have claimed,” said Greenidge’s statement, “even with this project (bitcoin expansion) our plant will remain firmly within the environmental limits set by state and federal governments.

“For example, and it’s an important one: this new project will not increase water abstraction or discharge into Seneca Lake.”

But the local petitioners argue that the planned dramatic increase in power output from the plant will inevitably boost the amount of Lake Seneca water needed to cool plant equipment.

In September, the Committee to Keep the Bus Lakes had asked the DEC to suspend, amend or revoke Greenidge’s four major air and water licenses. On October 23, the agency responded, saying: “The facility complies with the terms and conditions in all licenses … We will not suspend, modify or revoke Greenidge’s licenses.”

The petition filed this week against the Town of Torrey does not target either the DEC or the state Department of Public Services, all of whom have issued Greenidge licenses without the need for an EIS.

Courts have rejected proposals from Sierra Club and others to revoke Greenidge’s state air and water licenses issued by DEC.

And in June, the state Public Services Commission ruled that Greeenidge’s use of unmetered electricity to power computer banks mining Bitcoin is not subject to PSC regulation.

The commission voted 5-0 on the question, noting that environmental issues were “beyond the scope” of their ruling.

Only one commissioner voiced qualifications. Commissioner John B. Howard said the Greenidge case “portrays something we should be careful about.”

Referring to the DEC, Howard said: “I think our partners in environmental regulation need to be (alert), especially as we decarbonise our production system.”

The Seneca Lake Pure Waters Association had urged the PSC to exercise regulatory authority over Greenidge’s use of energy to process Bitcoin transactions. Jacob Welch, president of SLPWA, said the commission should not be ‘fooled’ by Greenidge’s oversight efforts. He referred to unresolved thermal discharge questions.

SLPWA is not a party to the Article 78 petition filed this week.

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