Digihost, a cryptocurrency mining operation in North Tonawanda, said it may want to use small nuclear reactors to generate more power for its facility located off Erie Avenue.
It takes energy to make cryptocurrency. Lots of it.
So, one cryptocurrency mining operation in Niagara County is exploring a potential source of abundant energy to meet its needs for megawatts of power: small nuclear reactors.
Digihost, a cryptocurrency mining operation, said it may want to use small reactors to power its facility located off Erie Avenue in North Tonawanda.
That is according to a memorandum of understanding the cryptocurrency company signed with NANO Nuclear Energy Inc. in mid-December with a goal of deploying nuclear power in Niagara County by 2031.
“The whole tech industry is struggling for power,” said James Walker, CEO of NANO Nuclear. “It has to be nuclear as a solution.”
But since that agreement was signed, local opposition has started to power up. Earlier this month, the City of North Tonawanda proposed a ban on most new energy source development, including nuclear.
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“We just don’t want another incident where something ends up in our backyard and it’s disruptive to residents and we can’t do anything about it,” North Tonawanda Mayor Austin Tylec said. “We need to press the brakes a bit.”
The “incident” Tylec mentioned concerned Digihost itself, which first began operations in the Niagara County city in early 2022. Since then, the company has caused aggravation to nearby residents who say the cryptocurrency mining operations create an irritating noise that can be heard throughout their neighborhoods and that disrupts their lives and hurts their health.
Citing reporting by The Buffalo News about the potential harms of the noise pollution, the North Tonawanda Common Council unanimously voted to ban new cryptocurrency mining operations for two years beginning in July 2024. The two-year moratorium was to allow the city time to hire an outside expert to analyze the noise coming from Digihost, and examine and possibly revise the city’s noise ordinance.
Bringing nuclear power to Digihost’s facility certainly wouldn’t address the noise issues.
It could, however, address concerns about the company’s energy usage.
“The opportunity to collaborate with NANO Nuclear represents a bold move toward achieving our sustainability goals,” said Michel Amar, CEO of Digihost, in a December press release.
Digihost otherwise denied requests for comment from The Buffalo News.
A car passes the entrance to the Digihost crypto mining facility on Erie Boulevard in North Tonawanda. Neighbors say the facility produces a constant and annoying humming noise.
Walker said the goal would be to first deploy a microreactor at Digihost’s North Tonawanda facility. This microreactor would generate between 1 megawatt and 20 megawatts of power, he said.
Digihost would need to eventually scale up to a small modular reactor capable of outputting between 20 megawatts and 470 megawatts, Walker added.
Digihost currently uses a 63-megawatt gas power plant, formally known as Fortistar, to power its cryptocurrency mining operations. Previously, the plant was used as a “peaker plant,” meant to distribute energy to the grid during peak demand.
Under Digihost, the power plant’s emissions have skyrocketed. In 2022, the plant emitted 28,886 short tons of carbon dioxide into the air. A short ton is equivalent to 2,000 pounds.
As of November, it spewed 140,684 short tons of carbon dioxide in 2024, according to U.S. Environmental Protection Agency data.
Nuclear power, on the other hand, doesn’t emit any carbon dioxide, Walker said.
“It’s the only form of energy generation where you know where all your waste is – to the very last atom,” he said.
Of course, nuclear reactors’ waste products are the subject of their own controversy. Walker noted that his goal for spent nuclear fuel waste generated at Digihost would be to “immediately ship it off.”
Digihost began operations just before New York, in November 2022, enacted a two-year ban on cryptocurrency mining operations over fears of how energy intensive the industry appeared to be. The state Department of Environmental Conservation was expected to analyze the environmental impacts of the industry by the end of the moratorium, but has yet to release a draft report on those impacts.
The DEC recently denied Greenidge Generation Holdings Inc., a cryptocurrency mining operation on the western shore of Seneca Lake, a Title V air permit, which would have allowed it to continue emitting millions of pounds of greenhouse gases into the air.
In its denial, which was upheld in part by a judge in November, the DEC found that Greenidge’s acquisition of a gas power plant flouted New York’s 2019 Climate Leadership and Community Protection Act goals to reduce greenhouse gas emissions.
Also in November, an Albany County Supreme Court justice required the New York State Public Service Commission to reconsider Digihost’s application to purchase Fortistar. Justice Richard Platkin had found that the PSC did not consider the 2019 CLCPA’s greenhouse gas emission limits when it decided Digihost could use Fortistar to power its cryptocurrency mining operations.
The DEC is also reviewing Digihost’s application to renew its Title V air permit, which expired in 2021. The permit would impose air quality regulations on Digihost and give the company permission to pollute the air as it operates the gas power plant.
Earthjustice, a nonprofit environmental law firm that fought against the issuance of Greenidge’s air permit, said it hopes the state will also deny Digihost’s air permit application, or at least restrict emissions from the facility.
Walker of NANO Nuclear said there is an obvious solution to these energy woes of cryptocurrency: nuclear power.
“This transition to microreactors and small modular reactors has to happen,” he said.
Equipment at the Digihost crypto mining facility. According to experts, noise that likely comes from fans to cool Digihost’s computers is probably detrimental to the health and well-being of nearby residents.
Walker is optimistic that NANO Nuclear can deliver a microreactor or small modular reactor to Digihost by its stated goal of 2031.
However, a class action lawsuit against NANO Nuclear was filed in the New York Southern District Court in August, accusing the company of making false or misleading statements about its progress toward bringing a nuclear power product to market. NANO Nuclear’s timelines for commercialization were “wildly optimistic, at best, and most likely impossible,” the suit claims.
The U.S. Nuclear Regulatory Commission is still awaiting a regulatory engagement plan from NANO Nuclear, which would kickstart discussions with the company about how it could apply to possibly build nuclear reactors, according to Scott Burnell, an NRC spokesperson.
In the United States, “both small modular and microreactor designs are still in the development/construction phase,” Burnell wrote in an email to The Buffalo News. The agency has issued construction permits for test versions of a small modular reactor design in Tennessee, Burnell added.
There is a push both nationally and statewide for the development of nuclear power to meet rising energy demands.
“The economy of the future: Microchip fabs, data centers and the supercomputers that power AI need tremendous amounts of energy,” Gov. Kathy Hochul said in her 2025 State of the State address. “To support these industries, we’ve already started developing an advanced nuclear strategy. This is a good investment.”
Her statements hinted at an initiative set to launch in February that is proposed to boost nuclear power generation in New York and nationwide. The New York Energy Research Development Authority is partnering on the initiative with at least eight other states, industry partners, the U.S. Department of Energy and Idaho National Laboratory.
But while the state may be enthusiastic about the future of nuclear power, the City of North Tonawanda and local advocates aren’t quite as keen to embrace it.
Deb Gondek shares her concerns about the Digihost cryptocurrency mining facility in North Tonawanda.
“We don’t want to shortchange anything on the safety and security aspects of this,” said Deb Gondek, a member of the North Tonawanda Climate Smart Task Force.
She supports the city’s proposal to enact a law banning nuclear energy development. The law would also block construction, installation and operation of new wind turbines, natural gas energy plants, coal energy plants and hydroelectric energy facilities.
Deborah Gondek has been organizing opposition to the Digihost crypto mining facility in North Tonawanda.
Tylec noted that the legislation, if approved, could be changed in the future if nuclear power, or the other energy generation methods, were found to be acceptable within the city’s limits. The law is meant to give the city time to possibly revise its zoning laws and would hopefully encourage discussion from energy generation industry leaders, such as NANO Nuclear, the mayor said.
“It’s not like we’re not saying we don’t want these,” Tylec said. “We’re just protecting ourselves while we look into all of this.”
A community information meeting about the possibility of nuclear power at Digihost is scheduled for Feb. 5 from 6 p.m. to 8 p.m. at the Carnegie Art Center at 240 Goundry St.
Additionally, the North Tonawanda Common Council is set to hold a public hearing on its proposed legislation to restrict nuclear reactors and other energy sources on the evening of Feb. 11, according to Tylec.
Reach climate and environment reporter Mackenzie Shuman at mshuman@buffnews.com or 716-715-4722.