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Last month local executives for Beijing’s Bitmain and Allrise Capital repeatedly advertised that anthe release of a power feasibility study being conducted by the Bonneville Power Administration (BPA) would enable them to restart the papermill—BUT ONLY IF the residents of Pend Oreille County contribute millions of dollars each year to subsidize the cost of Beijing’s bitcoin mining.
The BPA completed the study on May 24 and Bitmain/Allrise isn’t likely to be very happy with its findings. The study evaluated how much it would cost to provide 70 megawatts of additional power to Bitmain/ Allrise existing 100 MW bitcoin facility using a powerline connecting the Box Canyon Dam to BPA power grid in Mead, WA, with an interconnection stop at former papermill site in Usk. The Bottom Line up Front from the report is adding an additional 70 mw of power will cost around $36 million and take 3-5 years. The study’s finding derails Bitmain/Allrise’s bid to use the papermill restart claim as leverage against the PUD in the current contract negotiations. We asses that this will effectively kill the highly suspect restart claim. Background: Bitmain/Allrise initially requested that the BPA conduct this feasibility study last September, only a few weeks after entering into a 13-month power contract with our PUD. At that time, Bitmain/Allrise executives complained to the PUD that the market price for power was too high for them to operate economically and they demanded that the PUD give them with a new, lower-cost power contract in which power their power costs would be subsidized by county residents. Bitmain/Allrise attempted to use a highly suspect claim that they would re-start the papermill but only if the PUD agreed to the lower, subsidized power rates. Key findings of the report: 1. The cost to BPA for the upgrade is estimated as $26.3 Million. 2. The PUD will need to do substantial additional work which will likely cost around another $10 million. 3. The project would have ongoing annual costs because it would impact Avista as well and the PUD would likely need to compensate Avista for the additional power balancing that would be required to maintain grid reliability. 4. BPA estimated the work to take 3-4 years AFTER all preliminary studies and environmental reviews were completed— work that would likely add at least a year to the project timeline. As we have previously reported, the BPA power study appeared designed to be used as a weapon against the PUD. Bitmain/Allrise-requested BPA study due this week appears designed to pick a fight with PUD - PROTECT PEND OREILLE Most residents of the county are skeptical about Bitmain/Allrise’s claim that they intend to restart the papermill. Their local executives have publicly admitted that the costs of operation have substantially increased since the mill entered bankruptcy in 2020 and would not likely be profitably, even admitting that they hadn’t actually even completed a business plan. Local engineers who have recently inspected the mill machinery have uniformly reported that the equipment has mostly not been maintained and would cost additional millions to refurbish. See: Facts on the Ground show Allrise couldn't open the paper mill within five years if they wanted to (and they probably don't) PROTECT PEND OREILLE - Home Critics question grant request to restart Usk papermill - PROTECT PEND OREILLE On the other hand, Bitmain/Allrise are desperate for lower power prices and appear to be using the claim to restart the papermill simply as leverage against the PUD in contract negotiations. See: PUD Documents Show Allrise/Bitmain Misleading Public about Box Canyon Deal - PROTECT PEND OREILLE Papermill restart likely a bait-and-switch to get Pend Oreille residents to subsidize Beijing's Bitcoin Mining - PROTECT PEND OREILLE We assess the findings of this BPA study will further undermine the legitimacy of Bitmain/Allrise’s suspect claims about the papermill to the point where the papermill restart claim is finally dead.
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