A recent study by the University of Cambridge sheds light on the energy consumption of Ethereum, one of the largest cryptocurrencies by market capitalization. According to the survey, Ethereum’s overall energy usage before its Merge upgrade equaled Switzerland’s energy consumption for an entire year.
However, Ethereum’s energy use looks ready for significant reduction after the Merge compared to Bitcoin’s energy usage.
Ethereum’s Pre-Merge Energy Use Equals Switzerland’s One-Year Energy Use
According to the University of Cambridge’s Centre for Alternative Finance (CCAF), Ethereum’s energy consumption from when the blockchain started in 2015 until it switched to a proof-of-stake consensus mechanism last year is almost equivalent to Switzerland’s yearly energy consumption. CCAF, known for estimating the Bitcoin network’s energy usage, stated that Ethereum consumed 58.26 Terawatt hours (TWh) during this period, whereas Switzerland exhausted 54.88 TWh annually.
The CCAF has now revealed the CBNSI (Cambridge Blockchain Network Sustainability Index), which includes a thorough analysis of Ethereum’s power usage from a present-day and historical perspective to address environmental concerns. The energy required to generate non-fungible token (NFT) art on Ethereum has also been a concern for environmentally conscious artists.
Adopting PoS has significantly decreased Ethereum’s energy consumption by more than 99%, per the CCAF report. For a better perspective, the CCAF used an analogy where Bitcoin’s energy consumption would be equivalent to the height of Kuala Lumpur’s Merdeka building, the second-tallest building in the world, 678.9 meters (2230 feet).
In contrast, energy consumption from mining ETH pre-POS would be the same size as London Eye, which is 135 meters high. Conversely, Ethereum’s energy usage would now be as low as a Raspberry following the PoS switch.
Understanding ETH’s Energy Use
According to Alexander Neumüller, the CCAF’s research lead for digital assets and energy consumption, the institute employs creative methods to illustrate energy use. Such innovative ways include incorporating images of buildings and fruits to make complex concepts more accessible to the public.
Furthermore, Neumuller stated that while Ethereum’s energy consumption is lower than that of Bitcoin, CCAF doesn’t take a stance on the superiority of either algorithm. The lead researcher believes that proof-of-stake is not a perfect replacement for proof-of-work and that other factors must be considered.
He also stated that attacking a proof-of-work network is significantly more complex than attacking a proof-of-stake network. According to Neumuller, the former requires purchasing and using hardware and energy.
The latter is mainly financially based and can be disrupted simply by acquiring native tokens. According to CCAF’s estimation, Ethereum will likely consume 6.56 GWh of electricity annually.
By comparison, the electricity consumption of the Eiffel Tower in a year is 6.70 GWh. In contrast, it takes 14.48 GWh to keep the lights on for a year at the British Museum.
An estimate of Ethereum’s energy usage in the past is beneficial for projects that aim to offset their energy consumption. Hence, ConsenSys is working on a post-Merge project to address this issue.
The project would involve a group of Web3 firms called the Ethereum Climate Platform to handle the offsetting process.