Electricity is the largest running cost of a Bitcoin miner and the only major input you control after the machine is bought. Every miner on the network earns the same revenue per terahash, so what separates a profitable operation from an unprofitable one is how much it pays to produce that terahash. The cost is easy to calculate exactly: kilowatts × hours × price per kWh.
Key points
- Electricity cost per day = power (kW) × 24 × price per kWh. A 3,500 W machine uses 84 kWh per day.
- Break-even electricity price = daily revenue ÷ daily kWh. Above it, the machine loses money on every hour it runs.
- Break-even is not fixed. It falls when difficulty rises or the Bitcoin price drops, and it is lower for less efficient machines.
- Compare all-in cost per kWh, not the headline energy rate. Demand charges, fixed fees and cooling overhead all belong in the number.
- Run your own rate through the electricity cost calculator.
Why power price dominates
A miner converts electricity into hashes at a fixed rate set by its efficiency. Revenue per hash is set by the network and is identical for everyone. Hardware cost is paid once. Electricity is paid every hour, for as long as the machine runs, and the rate differs widely from one site to another.
Using the illustrative inputs from How Bitcoin Mining Profitability Works (a 200 TH/s, 3,500 W machine earning $8.28 per day after pool fees; illustrative, not current), electricity takes 30% of revenue at $0.03 per kWh, 61% at $0.06 and 91% at $0.09. The same machine in the same market is comfortable at one site and marginal at another.
The formulas
energy per day (kWh) = power (kW) × 24
electricity cost per day = power (kW) × 24 × price per kWh
electricity cost per BTC = electricity cost per day ÷ BTC earned per day
electricity cost per TH/s per day = J/TH × 0.024 × price per kWh
The last line follows from the definition of efficiency: 1 J/TH is 1 W per TH/s, which is 0.024 kWh per TH/s per day. It lets you compare machines of different sizes directly. See Understanding J/TH.
What a 3,500 W machine costs to run
Illustrative machine: 3,500 W at the wall, running 24 hours a day. Energy is 3.5 kW × 24 = 84 kWh per day, 2,520 kWh per 30 days and 30,660 kWh per 365-day year.
| Price per kWh | Cost per day | Cost per 30 days | Cost per year |
|---|---|---|---|
| $0.03 | $2.52 | $75.60 | $919.80 |
| $0.04 | $3.36 | $100.80 | $1,226.40 |
| $0.05 | $4.20 | $126.00 | $1,533.00 |
| $0.06 | $5.04 | $151.20 | $1,839.60 |
| $0.07 | $5.88 | $176.40 | $2,146.20 |
| $0.08 | $6.72 | $201.60 | $2,452.80 |
| $0.09 | $7.56 | $226.80 | $2,759.40 |
| $0.10 | $8.40 | $252.00 | $3,066.00 |
Each extra cent per kWh costs this machine $0.84 per day, or $306.60 per year. For other wattages, scale in proportion: a 5,500 W machine costs 5,500 ÷ 3,500 = 1.57 times as much at the same rate.
Electricity cost per bitcoin
Cost per BTC is the figure to compare with the Bitcoin price. With the same illustrative inputs, the machine earns 0.0000828 BTC per day after pool fees while using 84 kWh, so it needs 84 ÷ 0.0000828 ≈ 1,014,500 kWh to produce one bitcoin.
| Price per kWh | Electricity cost per BTC (illustrative) |
|---|---|
| $0.04 | about $40,600 |
| $0.06 | about $60,900 |
| $0.08 | about $81,200 |
The kWh-per-BTC figure rises in step with difficulty and is proportional to the machine's J/TH. It is a property of the network and the machine on a given day, not a constant.
Break-even electricity price
break-even price per kWh = daily revenue ÷ daily kWh
For the illustrative machine: $8.28 ÷ 84 kWh = $0.0986 per kWh. Below that rate the machine covers its power bill; above it, running costs more than it earns.
Break-even moves with every revenue input. Holding the others constant:
| Scenario (illustrative) | Daily revenue | Break-even price per kWh |
|---|---|---|
| Base case | $8.28 | $0.0986 |
| Bitcoin price +20% | $9.94 | $0.1183 |
| Difficulty +20% | $6.90 | $0.0821 |
| Bitcoin price −20% | $6.62 | $0.0789 |
| Block subsidy halves | $4.17 | $0.0497 |
It also depends on efficiency. Revenue per TH/s is $8.28 ÷ 200 = $0.0414 per day in this example, and break-even is that figure divided by J/TH × 0.024:
| Efficiency | kWh per TH/s per day | Break-even price per kWh |
|---|---|---|
| 10 J/TH | 0.240 | $0.1725 |
| 15 J/TH | 0.360 | $0.1150 |
| 17.5 J/TH | 0.420 | $0.0986 |
| 25 J/TH | 0.600 | $0.0690 |
| 30 J/TH | 0.720 | $0.0575 |
This is why an older, less efficient machine can still be viable on very cheap power and is the first to be switched off elsewhere. The gap between your rate and your break-even is your safety margin against difficulty increases.
Energy rate versus all-in rate
The price printed on a tariff sheet is rarely what you pay per kWh. Commercial and industrial bills commonly include:
- Energy charge per kWh consumed.
- Demand charge per kW of peak demand in the billing month.
- Fixed, delivery and regulatory charges, and taxes.
- Power factor or reactive power charges on some tariffs.
A miner runs at near-constant load, so a demand charge can be converted to a per-kWh figure by dividing by the hours in a month (8,760 ÷ 12 = 730):
demand charge per kWh = demand charge per kW-month ÷ 730
Example with illustrative tariff values: an energy rate of $0.04 per kWh plus a demand charge of $10 per kW-month.
| Item | Calculation | Result |
|---|---|---|
| Energy per month | 3.5 kW × 730 h | 2,555 kWh |
| Energy charge | 2,555 × $0.04 | $102.20 |
| Demand charge | 3.5 kW × $10 | $35.00 |
| Total | $102.20 + $35.00 | $137.20 |
| All-in rate | $137.20 ÷ 2,555 kWh | $0.0537 per kWh |
The demand charge is owed even if the machine was off for part of the month. At 90% uptime the same site uses 2,299.5 kWh, pays $91.98 + $35.00 = $126.98, and the all-in rate rises to $0.0552 per kWh.
Site overhead works the same way. The utility meter records everything behind it, including fans, pumps, transformer losses and lighting. If the site draws 5% more than the miners alone, each miner kWh effectively costs 1.05 times the billed rate: $0.06 becomes $0.063.
Hosting rates
Hosting, or colocation, means paying a facility to power, cool and house your machines. The rate is usually quoted either per kWh or per kW per month; divide a per-kW-month rate by 730 to compare them. An illustrative $45 per kW-month is $45 ÷ 730 = $0.0616 per kWh at full uptime.
Before comparing a hosting rate with a utility rate, establish what it covers:
- Whether billing is on metered consumption or on the machine's rated power.
- Whether cooling overhead, network, monitoring and basic hands-on work are included.
- What uptime is committed, and whether curtailed hours are billed.
- Deposits, minimum term, and set-up or removal fees.
- Who pays for repairs and what happens to a machine whose margin turns negative.
A hosting rate is an all-in rate, so compare it with your own all-in cost, including the infrastructure you would otherwise have to build.
Curtailment
Curtailment is switching miners off on purpose. It takes three common forms:
- Economic curtailment. On variable or spot-indexed tariffs, the price in some hours exceeds your break-even. Switching off for those hours avoids a loss.
- Demand response. A utility or grid operator pays or credits large loads for reducing consumption on request.
- Interruptible supply. A lower rate in exchange for the supplier's right to cut your load at certain times.
The decision rule is the break-even price: a machine should run when the price of power for that hour is below its break-even and stop when it is above. In a mixed fleet the least efficient machines have the lowest break-even and are curtailed first.
Curtailment lowers the average price you pay but also reduces hours of production, so fixed costs and the purchase price are recovered over fewer hours. Model both effects together, with the uptime you actually expect, rather than assuming 100%.