Solar Crypto Mining is the Killer App of Tomorrow

Think about it—  it’s money for nothin’

If you don’t relate to my reference or disagree, stick with me, and I’ll get you there.

My purpose has always been the same. I want efficient systems in place to make life simpler. This goal applies to anything from mining crypto to having a self-sufficient home that pays for the energy it requires. Recently, I have played around with utilizing my crypto mining to produce an income stream for my family. Is this ever going to be possible? Who knows?  But I’m getting closer to trying my strategies in “real life.”

Getting solar panels on a house is a great idea; however, the steps are complicated, and this complexity turns many people away from completing the process. First, you need to figure out if your house is properly positioned and, if so, how much sun it will get. Depending on where you live, the sun shines differently. For example, there are lots of clouds where I live and shorter days in the wter and longer ones in the summer. This means that the amount of sun I get is lower than that of someone who lives in a sunnier climate, such as Texas or Arizona. So, where solar panels are concerned, I start at a disadvantage.

These limitations don’t necessarily mean solar is a poor investment in my area or even that it’s a money suck. It just means that the productivity of solar panels on my roof is limited by geography. Understanding this limitation, scientists have been busy developing other electricity sources that many people might not know. For instance, I’ve heard there are windows and even paint that capture the sun’s energy and allow you to funnel it to a proper load in your house.  However, these unconventional energy sources are  not very efficient, and super expensive since they aren’t yet mass-produced.

The nature of a solar cell

Each solar panel has numerous solar cells, and all the panels participate in a solar array. Together the solar arrays power what’s called loads. Loads are high-energy-users like a fridge or a dishwasher. Solar arrays are great when the sun is up, but they stop working as soon as it goes down.

No matter how many solar panels you hook up to a load, their energy is nominal to nil if there’s no sun at all. Therefore, using solar panels for your dishwasher might work because you only run the dishwasher during the day. But hooking your fridge up to the panels would be disastrous since you can’t have your fridge powering down every night. That would lead to some really stinky cheese.

Keep it all contained

You might be wondering how this all works.

Each cell captures the sun’s rays, converts them into a tiny bit of electricity, and passes them along. Together all the cells mass produce electricity, but alone each cell barely produces enough energy to charge a single AA battery. Over time the amount of energy generated by single cells has increased due to improved mass production techniques and advances in solar science, but unfortunately it’s still not converting the vast majority of the sun that hits it’s surface.

However, some energized electrons don’t end up helping because there’s nothing to catch them. As a sun particle hits the panel, it reacts with a single atom and throws a single electron out of orbit. These electrons collect and surge down little wire streams emptying into a fast-flowing wire river. This wire could connect to a fridge and provide power when the sun shines.

When the electrons enter the fridge’s power supply, some of them are caught to run the compressor and the ice dispenser. These electrons then vanish into the atom and “work” to move energy inside the fridge and cancel the energy from the wire. 

The electrons that don’t get caught by work then go into a battery. The battery serves as an electron waiting room. When a load gets plugged in, the battery surges into action providing the electricity needed for all the electrons to get sent to the load. Their speed and quantity depend on the battery’s technology, purpose, and array setup.

Many companies compete for the “world’s best battery.” The trick is to contain more potential electricity in smaller places while allowing for flash charging and controlled discharging. As a bonus, these batteries allow trickle usage and indefinite re-charging without memory loss. Oh yeah, and you won’t ruin the environment by doing any of that. It will be a long battle of the battery, but there are good contenders out there already and really interesting technologies that haven’t yet been proven as mass-producible.

Folks are also working on nanotechnologies to make solar cells much more efficient. Currently, even the BEST solar panel is barely 50% efficient now.  This means that only 50% of the sun that hits each cell is converted to electricity. When you look at a typical solar panel, there are all these little holes that aren’t solar cells. Why not make the entire panel completely full of solar cells since that part generates the electricity? It seems as if the industry has caught up to my thinking because the newer solar panels appear to contain less white space. The panels are currently great at converting visible light, but completely ignore the ultraviolet and infrared light bands.

OK, so where does this killer app come in?

My plan has always been to use a government incentive to install solar panels on my roof and then use that electricity to power my miners. To me, it won’t matter how efficient the miners are because all the free energy is used to generate new crypto that I can sell, keep, trade, or bot with.

The economics of such a move has long been questionable, and to understand how I want to move forward, one must first understand a bit about the solar farming industry.

Roofs for rent!

When solar energy was first introduced, it was super expensive— I’m talking like 50k or so for a regular install. The panels were difficult to come by because there hadn’t been much mass production yet. Production was most likely stalled because these panels weren’t as efficient with rates in the 20% efficiency range. The installers and folks maintaining the panels were also scarce.  

Then big businesses got wind of free energy and sunk their teeth into creating some pretty fantastical deals. These deals would allow anyone with a properly vetted roof to rent that space to a corporation installing solar panels and maintaining them as a separate solar array.  This arrangement would allow the corporation to balance its investment across multiple states. With hefty government incentives available, the corporations received money back to repay their low-interest loans.

This process wasn’t something that I was interested in because corporate solar panels on a roof make a house difficult to sell. How do you convince a potential buyer to continue honoring your contract for corporate panels on the roof? I imagine it would be a hard sell.

Nonetheless, this arrangement seems fair because if you stayed in your home, there was a path to owning the panels. But here’s the catch— you would not own them until after they became obsolete. 

Here’s how that works for corporations and against you.

When you buy your 20-year-old panels with a leasing agreement, the corporation is taking that money and investing in a new roof with brand-new panels, leaving you with inefficient, obsolete, and sometimes broken panels. However, people who took this deal were still probably happy because their electricity bill would have been close to nothing for 20 years. So, when you look at it that way, I guess it’s a win-win.  

But all of this is just an example of how solar panels have been used to this point in time. I’m thinking of a much larger purpose. I’m talking about using solar energy to power a life.

Mass production hits

Phase two of the solar power saga kicked in soon after the need for panels exploded. The first round of US government rebates drove the industry to make better panels more efficiently. By this time, China had earned a reputation as the world’s production destination; therefore, most of the panels were manufactured in China. 

In fact, China manufactured a glut of panels that started collecting dust in storage when tariffs were put in place. And since the rest of the world wasn’t ready for the solar arrays of the future, these panels seemed useless for quite some time, not to mention quickly losing their state-of-the-art status as newer enhancements became abundant.

Once the Chinese tariffs were lowered, the solar world began to shine. Suddenly, the glut was in demand. Manufacturers were selling massive amounts of efficient, older model solar panels at an affordable price, and new installation companies were coming online and consolidating very quickly. Seemingly overnight, the solar revolution had begun.

A massive influx of new capital allowed this industry’s manufacturing arm to start truly mass-producing these panels. The industry shifted into third gear by building state-of-the-art factories and robotizing many aspects of production. Since the need was still smaller than the supply, the prices per panel were lower, and manufacturers were forced to adjust to the new market conditions. Plus, by then, the efficiency of each cell and each panel was far greater, so it was a better buy for your dollar.

What ended up happening was phenomenal. The manufacturers now sell the panels at a far lower price than before, and their efficiency and construction have also improved. Back in the 1950’s, efficiency was only about 4% and rose to about 20% around the year 2000. Today’s panels boast close to 47% efficiency, which might still seem low. But consider the average house install has at least 30 panels. This creates an extra 27% electricity on each solar cell, which adds up over time. 

This new-found efficiency has allowed solar technology to expand into areas with less sunshine, like where I live. Sure, folks had solar panels back in the beginning, but this novelty was mostly reserved for affluent neighborhoods. Now when I drive around, some streets have houses with solar on nearly one of 20 houses, and I see two kinds: solar electricity and solar hot water, which is very cool.

This proliferation of new solar installs allowed the industry to grow quite a bit. During this maturation, it became easy for me to see just how I could capitalize on a solar array and transition my house into an active participant in my wealth management strategies. Knowing that the infrastructure bill would soon come out with incentives, allowed me to start planning.

The sun only shines half the time

OK, I get it! Solar power only works part of the time. You don’t have to beat it into me; it gets dark at night, and that challenges most solar farms. Certainly, using the energy generated by a solar array to power a house directly isn’t possible since you still need to run your fridge at night. However, you can solve this problem by adding a battery array to store excess energy for night use. 

Similarly, when there are clouds, panels still work, but not as efficiently as they do in direct sunlight. Depending on the thickness of the clouds and the length of the dark times as the clouds pass over, the panels will convert whatever light falls on them. The panels directly around the shadow of a cloud produce full energy, so it’s only shadows of the clouds that pass over and give shade. However, it’s not enough sunlight to run your house 24/7, and if you intend on going off the grid, or live in an area where the grid isn’t reliable, you’ll need batteries, and a lot of them.

Well, using lots of lead-acid batteries to store solar energy was the way to go when we didn’t know better. Does it bother anyone else that this method seems completely incongruent with the concept of solar energy? With this arrangement, what we gained by using a wonder of nature to power our houses is destroyed by storing it in a lead-acid battery. Looking back, having LEAD and ACID in your house was truly toxic. And yet I know these same types of batteries are in each and every car that exists. The difference is that the quantity of batteries necessary to run a house is ginormous, so if every house now needed these toxic batteries, it would be extremely detrimental to our world.

Many new battery technologies have emerged since the solar industry switched to mass production mode. The one I have been watching the most is the Tesla battery. This is the one I want. In fact, I think I want two or three! Though it all depends on the size of my solar array because I can have ten super large Tesla batteries, but my solar array may only produce enough energy to fill one. Right-sizing each aspect of this build is critical, so I do not overspend. Though I guess, ideally, I’d be looking to generate the exact amount of energy I want to use and not store much…

but I’m getting ahead of myself.

In old days

I missed out on the time when people could sell energy to the grid and get money back. Now, I’m told they only give out credits for excess energy. So, say you have a solar array on your house that produces extra electricity that your house can’t use. You now have an electricity credit. In other words, the electric company owes you some electricity that perhaps you’d like to use at night to power your fridge. You’d still have no electricity bill because your panels provide all the power you need, and hopefully, the credits would cover you at night. 

That sounds great, I bet, but just know that in the old days, at the start of the solar revolution, you could sell that excess energy for real cash. Your electric company would pay YOU per kWh. How insane was that?

This method is still the case in some places, depending on the economics of the local electricity markets. Still, I’m not anywhere near where this is possible since there are so many solar installations around my neck of the woods. The market is already saturated with folks who have these relationships, and I’m pretty certain the electric companies are now investing in solar on their own, so they can sell their electricity at a premium.

In the beginning, there were also green energy credits that were sellable on a private market. They were kind of like a stock that you receive for generating green energy. Then other companies can buy that credit to offset their carbon footprint.  It’s in-part how large corporations can promise a neutral carbon footprint by a certain date—  that’s when they will have bought enough green energy credits to somehow make their existing pollution magically disappear.

How am I different?

Sure, you and your neighbor and the people down the street look at solar as a way to power your houses and perhaps as a way for corporations to make money selling clean energy to the grid. But I see other possibilities. I see a solar system that produces money, not electricity, and this money is not from selling electricity since that market is crowded now.

I have always been a hacker– not the malicious kind looking for trouble— but instead someone who looks at a situation and sees more opportunities than the obvious. As an example of this skill, I believe some isolated technologies have immense worth. Still, if I combine multiple innovative technologies, I might be able to live off of my house. You know, the money for nothin’ reference. I know, I know…this idea is a bit “out there,” and I have a hard time saying it without chuckling since it seems absurd. Or is it? 

The first steps

Let’s pretend my idea is not absurd.

Follow me on this journey as I take the first steps in finding what might be possible. Keep in mind, however, that this plan will take some time because it has many tasks witha precise order to come to fruition. Even if one element of this potential narrative is off, the project could collapse. What I’m about to embark on has been a rolling decade-long plan. It’s time to trust myself; I have my Plan B waiting in the wings. I’m finally ready to take the first steps towards self-sovereign living.

I just made it sound like I was about to conquer new worlds, but in reality, it’s just a solar installation that will generate and store electricity. Yup, that’s it. After all that build-up, it’s a plan that doesn’t require anything other than getting a solar installation. Even if my dream of earning from my house doesn’t come to fruition, at the very least, I will probably be able to say “bye-bye” to my electricity bill. 

This install is nothing fancy. It will look like every solar panel install already in place. Even though I won’t be able to sell the electricity, at least I’ll be making my house more valuable by adding a solar electricity solution. That’s my plan B!  At least I’m adding value to the house.

The plan has a few moving parts

Sure, I can list reasons I’m seriously considering solar energy, but I want to dig further into the issue. My purpose is far more complex than most. So, why do I push forward now?  Why do I care about this?  Why does it matter? And maybe most concerning…

What’s my risk?

It doesn’t really matter much if I can’t mine or my solar efforts flop because I’m in an industry that needs people to work. I could get a job, make money, invest it wisely and earn a decent living— that’s certainly part of my Plan B. But my plan is not all about ME. Instead, I want to push the world in a new direction. I want to set a precedent that perhaps others can follow.

I would like to possibly gain the attention of larger corporations to incorporate these ideas into their products. Most importantly, I want to develop a strategy for those with tons of sun and NO money because they can easily turn that sun into money with crypto mining. There, I said it. This is how my solar installation will differ from the rest. It’s all a matter of lining up the proper technologies in the proper order with the proper configuration and knowing how to use them correctly.

Part 1: The panels

I can’t do anything without a suitable solar panel install. I dream of buying farmland where I can build the array on the ground. This process is less costly, easier to maintain, and allows for easy expansion. Typically, the roof space allows enough panels to run household appliances. For me, however, the ground array will provide more energy— the more, the better. Some of the newer machines I own use more energy than a car consumes while it charges. I don’t want to get to the end of a solar array consultation and realize I can only run one mining machine OR my house.

Now that I’m seriously considering this venture, l need to stop guessing and learn exactly what the current panels are made of and what they can do. This will be easy as there are specifications that detail all of this. Plus, Tesla still probably has their calculators to recommend the right setup. During this review, I’ll only be concerned with numbers, not reality. I should end up with a working Excel that allows me to relate the current panels on the market with energy production and cost so I can see which is the best value. Though that doesn’t mean I’ll buy right away or even eventually buy the least expensive solar panels because there are other critical non-monetary factors as well.

For instance, are they ugly? Like seriously, will they look like an eyesore? And if installed on a roof, will they depreciate the value of my house, or damage it over time?  Since there are different looks and prices available, I can’t really say what everyone thinks is “ugly.” But I can predict what I’ll most likely do. I’ll buy something more expensive rather than less because of the looks. I just know it.

Part 2: The batteries

Ugh, no one wants to think about batteries, but this, too, is a numbers game, so I’ll need to integrate the battery storage into the worksheet. I don’t need to concern myself with the looks since they are typically hidden in a garage, shed, or basement. But I will need to focus on the technologies, how much room they take up, and how hazardous they are to the environment.

Certain batteries are toxic to create but recyclable, while others get thrown away, contributing to the world’s displacement of minerals. Relative to the Earth as a whole, there are these little pock marks called landfills that contain every imaginable contamination all wrapped up in cement, posing as soccer fields and parks. I need to ensure I don’t participate in that wasteful shame.

My search for batteries will probably be over before it starts, as I’ve been forever drawn to the Tesla battery. I haven’t looked at it in a while, but I believe this will probably be the battery that lasts the longest. Certainly, that doesn’t mean it’s the best, but with rechargeable batteries, the burn in is super critical to keep in mind. It’s more than important to note what technology is used in your solar array’s battery bank because if you pick the wrong one, your battery will hold less and less energy until, eventually, none at all.  This is called memory loss or burn-in.

I believe most of the current batteries earmarked for solar arrays are probably incredibly efficient. Still, it’s important for me to consider efficiency and size when looking for this piece of the puzzle.

Part 3: The miners

I own these already. My goal is not to spend more since the current mining market is all over the place. Once I can generate new crypto, I can start buying new machines with that crypto.  I certainly won’t buy any new models because my experience with them has been underwhelming. If necessary, I’ll be looking at buying older models since large mining businesses still tend to cycle through their equipment every few years. The secondhand market has thrived since the second round of miners shipped many years ago.

The equipment I have now is really old and incredibly inefficient, but the idea is to not spend money unless I make it. There is a real possibility that I will be able to mine but never generate anything significant. The mining difficulty has increased quite a bit since I started looking into this, thanks to big business domination.  Inexpensive credit and large capital allocations for thousands of state-of-the-art machines has allowed big business to take control.  It’s awfully difficult for home miners like me to make a living off of mining alone, and nothing from my vantage point indicates a change any time soon.

I’m a speculative miner and don’t really care what things are worth when I mine them. I intend to mine the maximum amount of coins with the least amount of equipment, and I don’t sell until it makes sense.

It’s important that I know what my miners need for energy and what they will produce for crypto given that energy; that is actually an easy test I can run in a day.  Basically, I need to plug in the miner and track its crypto output and electricity usage. The crypto output changes daily depending on how many other mining machines are crunching away at the same crypto as I am.  All of this goes into the spreadsheet… somehow…

I guess that most of my miners will produce very little crypto at this point since they are really old, and they will most likely use a lot of energy compared to their newer counterparts. I need to create some Excel sheets and calculate what the energy produced per panel is, and how many panels I need to run each machine. I aim to understand the cost per miner, not how much electricity it needs to run, but how many panels I need and what percentage of my battery array each machine type would need to run 24/7.

Math, math, and a little more math. Thankfully that’s a subject I like, though it will certainly take a long time to build out this magical worksheet.

Part 4: The trading

Lastly, I’m currently working on trading, and I’ve recently focussed most of my energy towards solar. Why is solar now on my mind? Because Biden was finally able to pass the bills that distribute the incentives that matter to me. I don’t want to be tired to the grid and these new incentives finally allow people with non-grid setups to cash in their tax incentive.

Even though I haven’t mastered trading yet, I suspect I’ll master it in the next bull market when everything goes up, making everyone a cryptocurrency genius. So, really, I should just wait for that point in time, whenever it is.

Trading for me includes bots and a revisit of all the things I did in the past to see what worked, so I can focus on that.

Setting aside all my failures and claiming them for tax relief for all of my future successes will allow me to make steady gains in the next bull market— or at least, that’s what I’m telling myself.  Who knows, this is still a bit out there in thinking, and certainly, this is last on my list of tasks.

Funny economics

I wrote about solar energy before, but at that time the markets hadn’t moved in the direction needed. Panels were still expensive and unattainable for me even with recent inexpensive loans. The whole system would have cost a cool 80k when I first looked into solar energy, and that system would be obsolete by now with all the newer, more efficient panels and batteries on the market.  At this point, I’m looking at $57k, and incentives drop this price to $16k. I suspect I’ll need to pay the full amount and get the rest back at the end of the year as a tax refund.

If we can make a few assumptions, I can explain how I look at this situation. Let’s assume the installed solar system I need costs $20k, and one BTC = $20k. It’s at least conceivable that I can exchange 1 BTC for my whole solar system, then work to mine back that 1 BTC to “break even.” In this case, I wouldn’t spend dollars, so I wouldn’t need to pay taxes on anything, though I’d refer to Clinton Donnelly’s team no matter what since I have the Audit Defense.

Perhaps this will work; if it can, I’ll push it. This push will not be to avoid paying taxes but instead to embrace crypto for what it is— an alternative currency. I think, though, if any company looks to accept crypto, they still peg the transaction against the USD, and this allows the taxes to be drawn out, making my transaction overly complex and much more expensive for me.

Rather than saying the solar array, batteries, and installation costs 1 BTC, they instead say it costs $20k, and to pay in BTC, I would first need to convert my BTC into USD and pay the $20k.  This will most likely be what I need to do when I move forward, but to do this, I’ll need to be conscious of the cost of selling BTC. Selling 1 BTC at $20k means that I’ll need to pay 30% of the funds to taxes, so to pay the taxes, I’ll need to liquidate more BTC. Thirty percent of $20k is $9k, so I’ll have to sell almost 1.4 BTC to net enough USD to buy the panels and pay the taxes. This transaction would require earning back more BTC to break even. Or, it might force me to think about this investment as a USD investment, not a Bitcoin one. 

It’s funny how I’m not doing anything involving the US dollar, yet I’m supposed to be taxed. Weird.

To close

I don’t know what will happen, but I do know that I heard Biden would give a tax credit of up to 30% to anyone who installs panels on their house, even if they are not tied to the grid. This is a lifesaver to me as it should counter the taxes I’ll need to pay to sell my BTC. So, it’s at least theoretically possible to execute my plan, assuming I have enough BTC to properly pay for the solar setup I’ll need. Though it would be a bonus if I could use less BTC to buy the panels.

Who knows, maybe this time comes sooner than later, but before the world’s financial horrors escalated, there was talk about moving civilization forward with alternative ways to generate the power we need without polluting the Earth’s precious resources. What a positive future these solutions could provide with forward-thinking! Let’s hope we transition back to that conversation sooner rather than later, and let’s hope that the plan I have hacked together becomes something I can actually execute. 

If I can, I am super excited to share it with you!