NY Supreme Court cases pit crypto against climate

ALBANY, N.Y. (NEXSTAR) — In a pivotal day for New York climate policy, two State Supreme Court judges ruled on Thursday that New York must enforce stricter climate laws on energy projects, including those tied to crypto-mining. Both rulings stuck to provisions in the Climate Leadership and Community Protection Act (CLCPA).

Crypto-mining consumes energy to solve complicated math puzzles to verify cryptocurrency transactions and prevent double-spending.

You can take a look at both related rulings at the bottom of this story.

DEC authority under climate law upheld

A state judge ruled on Thursday that the New York State Department of Environmental Conservation (DEC) has authority under the CLCPA to deny Greenidge Generation’s air permit renewal. The ruling from State Supreme Court Justice Vincent Dinolfo in Yates County affirmed that the department is responsible for making sure that state projects follow state goals for reducing greenhouse gas emissions.

Greenidge wanted to block the DEC's denial, claiming that the decision was unfair and inconsistent with state law. The company argued that the department lacked the power to deny the permit and didn't properly evaluate alternatives.

Although DEC maintained that their denial aligned with CLCPA climate standards, Dinolfo nonetheless found that their decision was flawed, legally incorrect, and arbitrary. His ruling annulled the May 2024 denial of Greenidge’s Clean Air Act permit and sent the matter back, ordering DEC to reevaluate. He said that DEC has to follow a detailed justification process to deny permits on climate grounds.

Greenidge operated a natural gas power plant and cryptocurrency mining project. DEC denied the permit in 2022, citing excessive greenhouse gas emissions that conflicted with the CLCPA’s targets for a 40% reduction by 2030 and an 85% reduction by 2050.

"The crypto-mining operation has been sucking up millions of gallons of water a day from Seneca Lake and dumping it back in at dangerously hot temperatures," claimed Yvonne Taylor, vice president of Seneca Lake Guardian.

But Greenidge argued that its mitigation timeline—reducing emissions 40% by 2025 and achieving zero emissions by 2035—was good enough. But DEC's authority to enforce the CLCPA can include requiring immediate compliance, the judge ruled while rejecting Greenidge’s proposal. He also denied their request for a restraining order to continue operating the power plant in Torrey, calling it moot.

"Not only was Greenidge trying to overturn the prior DEC decisions, it was also trying to decimate New York's monumental climate law," alleged Kate Bartholomew, who chairs the Atlantic Chapter of the Sierra Club. "I am disgusted by how much this polluter is allowed to abuse the legal system and to continue operating as it aggressively litigates its weak claims."

Still, Dinolfo panned the DEC’s decision to stop the permitting process after finding shallow inconsistencies with CLCPA guidelines, because the law requires deeper analysis. It's possible that the company can gather more evidence or change its approach to get the permit approved. Meanwhile, the DEC must address the legal and procedural problems that Dinolfo pointed out.

Judge overturns power plant sale, orders environmental review

A state Supreme Court judge ruled that New York's Public Service Commission (PSC) must reconsider a decision allowing the sale of a gas-fired power plant because the agency didn't examine the potential environmental impacts. Environmental groups argued that the PSC ignored how the sale could affect greenhouse gas emissions and disadvantaged communities, as required by CLCPA.

The PSC approved the sale of the Fortistar facility in North Tonawanda to Digihost International, who planned to use the facility for cryptocurrency mining. The Clean Air Coalition and Sierra Club sued, claiming the deal would increase emissions and harm vulnerable communities.

"When the PSC fails to carefully consider the environmental impacts of its decisions it violates the intent of the climate law and the justice it seeks to advance," said Roger Downs, conservation director for the Sierra Club Atlantic Chapter. We hope this ruling is an appropriate wake-up call for the PSC to do better."

They argued that the sale could increase emissions and hurt people in disadvantaged communities. Ultimately, Judge Richard Platkin annulled the PSC’s prior approval, ordering them to reconsider the deal. But if the PSC finds that the sale contradicts CLCPA requirements, they'll also have to justify how or why they're contradictory and suggest ways to fix it.

Platkin agreed that the PSC failed to evaluate legitimate concerns under a section of the CLCPA that mandates incorporating emissions and community impacts when considering state permits. However, the judge dismissed claims about disadvantaged communities because the standards for identifying them were not yet final when the PSC approved the sale.

Take a look at both decisions below: