Impact Mining - Bitcoin Hashrate for Good w/ Austin Mitchell & Nicholas Selby

Speaker A: There are parts of the world where it's not about the ability to access energy in terms of physically having the kilowatt hours. Access is now really being defined by what the folks on the ground living in these communities, what they can actually afford.

Speaker B: Hey, so welcome back to the Copless Mining podcast. I am so excited to be joined by two guests today. Austin Mitchell from Sunota Energy and Nick Selby from Renuvia Energy. And I am going to geek out in this conversation. So before I get too excited, I'm going to try to give the floor to my guest and let them introduce themselves a little bit. But if you've met me, you know, it would not be my nature to not say a few words first. So it's my first. Initially, it's my pleasure to introduce Austin Mitchell. Austin's become a close friend of mine. He has pioneers, the CEO, founder of Sonota Energy. They do amazing things. So instead of me stealing all of his thunder, I'll ask him to introduce himself. And then today I'm meeting Nick Selby for the first time and of course as a good, good podcast, uh, uh, host, I did some research and oh my goodness, what an amazing background. I think we're going to have a really exciting conversation right now about transactive energy and using Bitcoin mining to pay for electricity and communities that need it. I'm so excited for this. Austin, would you take the floor and do a good introduction. Let this Austin, let this uh, audience know who you are and what Sonota is up to.

Speaker A: Sounds great. Thank you so much Curtis. And it is an absolute pleasure to be, uh, participating uh, in this call today. Uh, there is a lot that we've been slowly building towards that we're super excited to share with the world. So thank you again. Um, so my name is Austin Mitchell and I'm the co founder and CEO of Sonoda. Uh, I worked prior to starting Sonota for 15 years in the energy industry and it was at the end of September or in September of 2022, uh, that myself and my two co founders, Lisa and Alan left, uh, our jobs and energy to start Snowden. And we started Snowden with a motivating purpose being to create an abundant energy future for everyone. Um, and in the bitcoin space we have earned a reputation for our innovation on the Lightning Network, being the first to settle commercial energy contracts in Bitcoin. Uh, but more importantly, uh, is what we're doing today in the energy space which is being the leading payment solution for energy suppliers, uh, that focus on the Bitcoin mining industry. And I'm proud to say that as a company we're serving uh, over dozens of bitcoin miners today, helping them secure better contracts with better credit and collateral terms, as well as lowering the cost of energy. Um, so we're really, um, now as we progress as a company, excited to talk about something that we have been working on, as we've been developing, know, staying aligned with that purpose of creating an abundant energy future. And that is our Impact Mining initiative. Um, we've been engaged with folks like Nick and others on the front lines of energy access, particularly in Sub Saharan Africa, uh, from the very start and we've learned that there's you know, quite a number of challenges there. But uh, impact mining is an opportunity to really address an uh, energy affordability issue in new to power communities that uh, we think has a great opportunity to bring together bitcoin mining, the industry we serve and love, uh, with, with folks who are living, you know, with energy scarcity today.

Speaker B: Austin, that's, that's amazing. I, you know, as I mentioned, we've had a chance to, to talk many times and I don't know that I pulled out from previous conversations that when you, Alan and Lisa founded sonoda, that you had of the, the future of abundant energy is one of like your, your mindset. So that, that's so closely aligns with some things that I hope come out in today's conversation. I, I see that, you know, electricity is what's needed for human flourishing and how, how for being here, um, you, you use the words impact mining today and I do think that's one of the topics that we're really going to get into. And so, so Nick, I, I would love to turn the attention to you sir, and um, uh, let this audience have a, have a chance to meet you. I, you're, you're the, the, the VP of engineering for Renuvia Energy. And so um, whereas sonota is a fun word and you can ask Austin about the history there. When you're looking at Renuvia on, on, on paper you're not sure, but like when I look at it, I think what you're saying, it's renew via energy. And that is just an amazing, amazing, uh, uh, tie in there. I have done some research and I think you've got an amazing background. You're um, um, you know, mechanical engineering philosophy, you've studied in Georgia, you graduated from mit and I, and I'll probably get excited about that. Um, uh, uh, Nick, would you please do this audience a favor? And introduce yourself and start by you know, after you give some of the, your personal background, give us some introduction into renovie, uh, energy. I think this audience, this audience is going to be a lot of the existing bitcoin mining industry. They are familiar with Sonoda. Sonoda is leading in transactive energy. But this could very well be their first chance to meet Renuvia. And I think there's going to be so much tie into the future. So if you would please take several minutes and tell this audience about your, yourself about your background and then also an introduction to Renuvia.

Speaker C: Sure, yeah. Thank you so much. That was a great introduction Curtis. Now I have to follow that with me introducing myself and I'm not sure I can do as good of a job but yeah, you hit the nail on the head. My name is Nick Selby. I'm the current Vice President of engineering for Renuvia Solar Africa. Uh, my background is engineering all the way through. I have uh, hold a Bachelor's of Science in mechanical engineering from Georgia Tech and then a master's and Ph.D. in electrical engineering and computer science from MIT. My background uh, before I got into the energy industry was mostly robotics and machine learning. Um, uh, lots of you know, really fun math, really fun, a lot of you know, hands on building physical things which makes me feel really good and also ah, programming those things to do uh, really, really amazing actions. Um, when I came and joined Renovia three years ago now I joined at the beginning of 2022 and absolutely love it. I had never been on the continent of Africa before I moved here and I'm so, so glad I did. Best decision I've ever made. We are first and foremost a solar EPC company. We develop, design, finance, build, own and operate cutting edge renewable energy infrastructure to help businesses and communities transition to clean, resilient and affordable energy sources. Renuvia has connected over 40,000 people to renewable mini grids representing 24 communities across rural Africa. We have operations in six countries and commercial installations in 18 US states. Um, that's my background, that's Renuvia and I am, I uh, was approached by Austin and Sonoda not too long ago through Professor Kevin Halanan, uh, the University of Ohio, Dayton. Um, he approached us with the idea of uh, connecting and putting impact mining to work through our mini grids, providing uh, an even more affordable way for these people to get electricity uh, through these great renewable sources.

Speaker B: Well first of all you killed it with the energy if you, if you thought I did. Well, um, that, that is, that is amazing. So there's several things for me to, uh, for me to say there. Um, for one, I love that Ohio came up because that's where, where Austin and I first met. There really is something special going on in Ohio. And to know that you've got a professor there who was tying that together. It's one thing to look at, you know, academia and say, hey, I'm here to teach, but it's afterwards, when you're able to build relationships to people who are doing things that matter. That is. That is so impressive. A couple things I didn't know about you, Nick. Even though I tried to do my, my good amount of research, I didn't realize that you had a Ph.D. also. So both you and Austin, um, are PhDs. And now this is a little bit selfish, but when two PhDs get on with just a Luddite with, uh, you know, I got a bachelor's in political science. Are you like automatically judging me for not being as, as sharp as you two? Give me the lowdown.

Speaker C: What, what's that like? Oh, zero amount. I think there are two types of tech people in the world. One, one of them has like an Amazon, Alexa, Google, iPhone, everything. Uh, and you know, they're constantly interfacing with uh, you know, various Internet of tech, like, uh, or yeah, IoT devices all over, all over the place. And the other kind has like a single printer that they keep a like, loaded handgun next to in case it makes a weird noise. I'm definitely the latter. Uh, so I can empathize a little bit. Yeah.

Speaker B: Oh, that's beautiful. You know, I mentioned there were two things and um, Nick, are you, are you boots on the ground in Africa? Are you, are you located on that continent? That is a. That is amazing. So you're, you're doing some Loman's work with time zone arbitrage because it's, uh, 11:00am Central. We're recording now. Are you now? I know that some of the projects that we're working on are in, in Nigeria. Where are you located at in Africa right now?

Speaker C: I'm based in Nairobi, Kenya. I do work across the continent. And yeah, being based here in such a major city on the continent is very, very helpful for being able to get around. And it's, uh, not too late for me. I'm just finishing up my work day. It's a little after six for me.

Speaker B: Oh, fantastic. Well, see that's, that's how you know, you're dealing with that, uh, that, that guy with the bachelor's. He doesn't even know time zones that well, um, I, I, I'll tell you that honestly, there are like, there's, there's a half dozen really important threads that I personally want to pull on. But I feel like that that would be a, I really do want to give the audience a chance to fully understand what we're here talking about today, which is transactive energy impact mining and energy use on the continent, Africa communities who didn't have it and now they do. So, um, Austin, um, I'd kick the mic back to you if I could. Um, you mentioned Impact Mining in your introduction, but would you expand on that thread? Would you break that down? Now the audience has met both of you, they understand why we're here. Tell us again what Impact Mining is.

Speaker A: Yeah. Thank you, Curtis. So Impact Mining is a way for Sonoda, um, to really take what we've built from a technology standpoint and leverage it to create impact in the world. And we are calling uh, this initiative Impact Mining, uh, because it really brings together uh, the bitcoin mining community, as I said before, with communities that are new to power globally where there are energy affordability challenges. And so Impact Mining, what is the vision for it? It is that hash rate generated, uh, with what would be relatively abundant energy around the world can be used, uh, to accelerate any energy abundance in communities that are just getting off the ground with power. And so uh, for us when we think about Impact mining, it is ah, really important to focus on who's going to be benefited on the ground. Um, and so when we talk about these new to power communities, uh, the key thing there is that in these communities every kilowatt hour that gets consumed is being put towards a productive use. The communities are leveraging, uh, the energy that they now have to power hospitals, to power schools, to keep the lights on, you know, an extra hour at night, uh, to continue education. And so it's, it's interesting to think about the world that we live in today. Uh, you know, where I probably left my house leaving one or two lights on this morning, you know, that is, those are kilowatt hours not being used productively. But there are parts of the world where it's not about the ability to access energy in terms of physically having the kilowatt hours. Access is now really being defined by what the folks on the ground living in these communities, what they can actually afford. And so uh, Nicholas, Nick M. Would be the best person to really talk about uh, how it is that even having a small bit of economic relief, uh, can really unlock additional productive use of energy in these communities.

Speaker B: Thank you, Austin. Um, you know, I do think it's a good pivot to like bring uh, bring Nick into the conversation and expand on it. I do want to, you know, I, I want to point out, tie a thread together. Okay. So hearing you, um, uh, you know, the time and, and thought that you've invested in impact mining, I want to point out to this audience, I think one of the most impressive speeches that I've ever, impressive talks that I've ever seen in bitcoin was when you presented to Michael Saylor and MicroStrategy their Bitcoin for Corporations, um, conference last January. So January 2024, um, you brought forward to that, that audience transactive energy. And if this audience here doesn't already know you, Austin, I really want to encourage them to go back. I think it's a 13 minute long talk. You killed it. And what an exceptional leader you are, uh, for bitcoin, Austin. So, uh, Nick, I, I dropped a couple words there. I dropped Michael Saylor and MicroStrategy. Now, uh, Saylor to me is maybe one of the most famous MIT grads. So I want to, you know, there's no pressure. He's not watching. I just want to find out, is Michael Saylor famous inside the world of uh, mechanical engineering graduates at mit? Do you know who Michael Saylor is?

Speaker C: Not mechanical engineering graduates, but definitely the uh, the broader MIT community definitely knows of him. To be honest, I'm relatively new to the bitcoin space. Uh, we've been developing, completely separate from all of this, we've been developing a blockchain based carbon asset platform. And um, the only blockchain based, uh, currencies that I have any investment in at all are the ones I use to build those, uh, to build um, those distributed platforms, those distributed softwares. And I only have what I need in uh, order to run that software. Um, so I'm relatively new to this space and I've been enjoying kind of the drinking from the fire hose, so to speak, and learning everything I can.

Speaker B: I bet it does feel like a fire hose. But I'll share with you. Welcome. Um, uh, you've got the skills to immediately be a contributor into our ecosystem. And I know that you've had this passion for building, um, renewable energy projects long before you found Bitcoin. But I think that you're going to discover a real synergy and I bet it ends up being a larger part of your work in the future. But what could we, could we transition into that? So you, you know, you were introduced to Austin not that long ago through a professor who thought there'd be a way to work together. But long before that you were building electricity infrastructure in Africa. Could you talk to this audience about that? So are these, are these small solar farms, are they hydro dams? You know, what, what are you doing to build electricity in Africa? And then afterwards I want to ask about how do you pay for it? And I think that's going to be the amazing thing that ties together impact mining and transactive. Could you tell us, uh, you know, you're going to have to distill it, but could you tell us about building renewable energy in Africa, Nick? It's amazing, certainly.

Speaker C: Yeah, absolutely. Across the continent. And this varies obviously pretty substantially country to country, but uh, rural electrification is still a big problem on the continent. Um, uh, in Kenya, for example, a majority of people are connected to grid power, uh, within the country. But that grid power, even if it's, even if it's technically there, is oftentimes not very reliable. Uh, and that still leaves many, many, many communities, uh, who are completely without any form of electricity at all. Uh, Renuvia, as well as other mini grid companies on the continent come in to identify which communities are most in need of new electrification. Most, which, which rural communities are most in need of rural electrification and are also so far away from whatever current national grid infrastructure there is that it doesn't make economic sense to expand out to that community in order to provide them with electricity. I think the infra structure needed in order to build those massive high voltage cables, um, held up with these kind of behemoth steel structures, uh, you know, kilometers and kilometers and kilometers out into the middle of nowhere. So what we do instead is we identify these communities. We, we hold interviews and meetings with them as well as local regulators in order to understand exactly what their needs are. Then we build a small solar power plant and small low voltage grid infrastructure around their community. Uh, then we uh, basically connect everybody's homes and serve as like a tiny version of an electrical utility just for that. Um, and that infrastructure that many, you know, solar power plant and small grid infrastructure is what we call a mini grid. It's an off grid solution. So we're not connected to any kind of national grid or other electricity sources. We just have a solar power plant, sometimes small, uh, like wind turbines or a diesel backup generator just for the last 5% kind of thing. And uh, then we, we serve as a electricity provider again just for that community.

Speaker B: Yeah, well, I do think it's, you know, we Obviously want to unpack the, the financial side of it, and that's going to tie together this conversation. But before we, we go there, maybe dive a little bit, a little bit deeper. You know, Austin mentioned, um, you know, maybe he left a couple lights on at home and like, you know, we're here recording and I, I've got a, I've got a camera on just so that my shiny bald head shows up better on this, on this interview. And you know, the. We, we certainly here in the United States take electricity for granted. But to understand that there's like 600 million people on the continent of Africa that like, literally don't have electricity and you're there solving that problem, could you, like what, uh, like how does it change these people's lives when electricity comes into their, their community?

Speaker C: Yeah, that's a, that's a really good question. Um, I'll tell you a story that happened to me relatively recently. We recently did a pretty large mini, uh, grid expansion. Um, so we had a mini grid that was serving around 500 customers, and we expanded it to serve a little less than three, a little fewer than 3,000 customers. Uh, and during that process, a big, big part of that, as you can probably imagine, is building new power lines to extend further into this rapidly growing community. Right. Um, I, uh, was taking a little, you know, like, um, I call it a motorbike, but it's like very, very small compared to what you're used to in the US it's like a little 150cc engine motorbike, driving it around, doing preliminary inspection of the power lines kind of as they were being built. Um, as you know, this like, random white guy in a very rural community in, uh, in Kenya was driving around on a motorcycle. It was especially pointing at and like, asking questions about and commenting on the growing grid infrastructure that was being put up there. Um, I think it seemed very clear and obvious what I was doing. Um, and so, uh, rapidly I had, um, uh, a posse, I guess of about 20 to 30 small children running around after me, kind of pointing and giggling. And then when I would look at them, they would do like the, oh,

Speaker B: I don't know, I'm not looking at anything, and giggle.

Speaker C: Um, and after they, after they kind of like put together what I was doing there, they, uh, started chanting powa ajah, paua aja, which is, ah, Swahili for power is coming. Power is coming. Um, and that's, uh, I think that's just a great illustration of how excited people are, um, to get access to Electricity, um, it's life changing. Um, and it's been a really beautiful thing for me to be a part of.

Speaker A: Well, Nick, you know, one thing. Curtis, sorry to jump in. You know, Dr. Kevin Hallinan, who, who made the connection for us originally is actually a paper that Nick, uh, and colleagues from Anubia put out where uh, they did a comprehensive study, uh, you know, pre and post electrification. And I think that really sort of speaks to uh, you know, numbers wise, how big of an impact that is.

Speaker C: Yep. Yeah. Should I focus on the quantitatives for a little bit, Curtis?

Speaker B: Yeah, you know, I, I do, I think, uh, let me, let me tee it up this way and see if it's exactly what you, you had in mind. So I, you know, mentioned, you know, earlier, you know, Austin and I spent some time together and one of the things that he, so he's really excited for the partnership with Renuvia, um, Nick. And one of the things he shared with me is that that your team's doing it differently, that you have a different approach and that it's working, it's working better. And so if you would, you know, include that as, as uh, some of your thoughts. But yeah, definitely focus on that, would you?

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Speaker C: Certainly. So, uh, one thing that's very important to Renuvia is to quantify our exact impact. Right. Like it's nice to be able to say, yes, we're providing first time electricity for rural Africa and solar power and like all this kind of stuff, like the relative, like the buzzwords that kind of make people feel good. It's another thing to quantify exactly like exactly numerically with confidence intervals what this means for the communities and for the people you're serving. Right. So we've been doing uh, we've been working with third party surveyors to uh, to administer surveys on an individual person basis before connection to the mini grid and then in the years following once per year, um, after they are connected to electricity, power. And what that allows us to do is track individual customers, um, on a, on A per family, per household basis and also on a per business basis to see how their lives are impacted across, uh, you know, five different KPIs and 80 different questions, um, what's going on inside of their individual homes? So with that data, we published a paper, uh, just last year in Environmental Research, Infrastructure and Sustainability, which is a peer reviewed, kind of scientific academic journal. You're obviously welcome to go check it out and make sure our math is good. But what we were able to find out is that, uh, the impacts of mini grids are, uh, obviously extremely positive and um, in particular had amazing effects on the local economies, uh, local education and also female participation in the labor force. So, for example, we found that, uh, in many of our communities, uh, especially in Kenya, median income quadrupled, uh, within one year after mini grid connection, which is wild. Uh, um, more broadly, across Africa, we found that female participation in the labor force increased 17%, uh, after connection to a mini grid, and that for every additional $50,000 invested into a mini grid, that means that 20 more young girls get to go to school. Um, obviously we have a lot more amazing quantified statistics than that. And you know, I encourage you to look, I encourage your listeners to read the paper, um, to kind of see exactly what they're looking for. Um, we did a study that, uh, focused on, um, gender equality and uh, financial empowerment and health and safety, um, looking at the impact on hospitals and crime and all sorts of stuff.

Speaker B: Um, but, yeah, well, that's definitely a cue to me, uh, that we need to make sure to link that paper with this podcast. And thank you so much for even Austin calling that out and for the invitation for people to read it. So I want to, um, a couple things. There's real work being done, so the three of us are aware of this, but we're sitting here with something real happening and we want to talk about that in this podcast. But let's stay on, um, this course a little bit longer before we get into the real world impact that impact mining is, is having. Um, Austin, I want to, I want to share a personal story about how I became, you know, interested in energy abundance. And like I mentioned, I was. And uh, it's going to tie back to another MIT grad, if you didn't know that. Nick, um, I was, as I mentioned, I was really surprised that I hadn't heard your, um, your take on, you know, the future of abundant energy being part of your mission. Could you talk to me maybe personally and then this audience as well? Like, when did energy abundance first start to your radar as something that you were passionate about. Austin.

Speaker A: So I think the best part about this, this, this time of my life is you know it was beginning of COVID um and I uh, was you know at home you know, working long hours, focused on, on Covid relief for uh, for the utility I was at. And it was at that same time that Bitcoin uh, mining started to come over to the United States. And you know having spent my career in the energy industry, um, I saw Bitcoin mining as being something fundamentally different, um, in terms as an energy consumer, being location, uh, agnostic, being extremely price sensitive. It took uh, just a little bit of time for me to realize how impactful um bitcoin mining was going to be. Um, and it gave me a ah, pathway forward uh, to energy abundance. So we always are going to live in two worlds, Curtis. Two mindsets if you will. One of scarcity, one of abundance. And I had spent most of my career oriented around scarcity, oriented around how do we get people to be more efficient, uh, dealing with issues with providing enough supply where there was demand. Um, and so when I saw bitcoin mining this was the unlock, uh, this was the thing that said wait, abundance is actually possible, uh, if we can really fundamentally transform the economics of energy and use energy where it is available to deliver good around the world. There's a whole lot uh, of reason to be excited about an abundant future as opposed to one that is focused on the scarcity of energy. And it was uh, just a few months after that actually had a fateful round of golf uh with Dr. Halanan, um, where he had himself spent uh, his entire teaching career. He's the one who taught me everything I needed to know about energy efficiency. Efficiency, um, and where he himself had a couple week transformation from thinking in terms of energy being scarce to energy being abundant. So that's really the start of it. Um, and I think as time has progressed I've only gotten more and more uh, excited and hopeful and optimistic that that future can be made into a reality. Fact is there's plenty of energy every day hitting this earth in the form of the sun. Uh, it's just a matter of our ability to, to harness it and put it to work.

Speaker B: Nick, uh, the metrics that you shared in the real world, um, impacts that's going on in the community really resonated with me. Um, I believe that electricity, poverty, energy poverty first hit my radar when um, Eric Herzman who CEO, founder of Gridless if you don't do you already know Eric Nick is that um, uh, when he was on the Compass podcast many years ago and then I had a chance to get to know him personally and I was really just confounded by the learning that there were 600 million people who didn't have electricity. They didn't have electricity. And then one of the base level understandings that I have is what would you do if you had electricity? Oh yeah, you would read at night. That's crazy. Your daughter would be able to read at night. Or that you might refrigerate food. Like uh, just crazy stuff like having light bulbs and refrigerators. It's really blowing me away. And then I, I, I'm gonna, I'm gonna insert myself in this conversation a little bit and share a little bit of my own. Uh, my personal story. I mentioned another MIT grad, Peter Diamandis. So Peter Diamandis is a prolific entrepreneur. He's made, you know, more than the last dollar he's ever spent and now he's entirely focused on giving back. And he has um, a pretty significant uh, online community, open exo with um, uh, and I participate in that. And they, they led us through what I would say is a self discovery journey trying to find your mtp. He took his community through, through a learning process to discover their mtv, their massive transformative purpose. And Austin, you mentioned scarcity. What I really figured out was I had spent my entire life um, in a fear and scarcity mindset. I was trying to provide for my family. I wanted the light bill to stay on like it was entirely fear and scarcity. But then when I discovered bitcoin in low time preference and recognizing that the future was abundant, that I had already won, that really gave me a chance to switch perspectives. So going through that MTP process, when I got outside of fear and scarcity, the, the biggest thing that resonated with me as a, like a global mission. What could I possibly be interested in that excited Curtis? It was energy, poverty and trying to be a uh, solution provider. So it's honestly my real pleasure to sitting here with the two of you who are doing a uh, really meaningful work. Nick, you've been building electricity in Africa for multiple years. You've invested your career in Austin, you've, you've built a technology company that is highly successful in bitcoin mining. And now through your own personal interest and passion, you've developed a uh, way to give back and impact mining. Is that I hinted earlier in the conversation that there's some real world projects going on. So I'm Familiar with two of them and I know that there's likely more and there's more yet that could be done. But Austin, I believe that this is uh, something uh, that you really helped surface. And of course um, Compass were a bitcoin mining company. We were able to get involved in a very small way, just a little bit of uh, S19 hash power pointing towards these projects. But Austin, would you take the mic here and tell us what is going on today?

Speaker A: Yeah, certainly. And thank you, uh, Curtis to you for uh, you know, connecting with your purpose, uh, and being an early supporter of this project. Um, and you know, it is the hash rate that Compass is donating today. It gives me an opportunity to talk about, you know, how do we go from hash rate to uh, impact on the ground. And so uh, what Compass is doing and what others will be able to do in the near future is donate a slice of the hash rate that they generate, uh, to go to the impact mining initiative. And it will go obviously through the pool and to the donation node and then what SNOTA does. So we sit, uh, as the technology provider to impact Mining. And so what our software is doing is every day it is calculating uh, how much energy uh, is being used and then using those calculations to then route a donation to uh, Renuvia to offset uh, electricity costs in the high impact projects that they've chosen. Um, so everything, what's special about this donation model is that everything is done extremely efficiently and the impact is direct. So we think 99% or more of the hash rate donated will be converted to actual impact, uh, on the ground. And so I think that's special to have the ability to approach donations in a way that uh, is direct and as transparent as what we're talking about today. Now other key pieces of this is Renuvia. Um, so Renuvia obviously, uh, is the EPC and is operating these grids going forward. So they know the communities, they know uh, where those impacts can be greatest. So they are the ones selecting the projects, designing the project to maximize the impact that lowering the cost of electricity will have. Um, and so that's really where you as Compass donating hash rate are now connected to Renuvi and the projects on the ground by actually using that hash rate to lower those electricity costs. Um, so that's really kind of the fundamental setup of what impact mining it is. It is taking hash rate from abundant parts of the world and converting that hash rate into ah, real impact in places where uh, energy is accessible. Um, but you know, due to the affordability due to constraints that people have economically. This is providing that economic relief to allow them to consume more energy and use it for productive purposes, which will only accelerate everything that Nick talked about earlier in terms of, uh, the community impacts.

Speaker B: Nick, uh, unpack that more and tell us if you can about the community impacts that's happening today. Now of course I'll butcher pronunciation, but from what I understand, there's two meaningful projects that are happening. There's a hospital that is using some of the electricity from your systems. And then there's also a community, a village, a zuzu and a larvae. If I have it, if I have pronunciations correctly, uh, help me out Nick. Uh, uh, throw me a rescue line. Tell me about these two important projects.

Speaker C: Absolutely. So the two projects are one, a community hospital in a community called Oluibiri, Nigeria, and a second community called Ozuzu, Nigeria. Ozuzu does have a clinic and also a, a school, uh, associated with it as well. That's going to be the recipient of this excellent donation. Um, these communities are absolutely beautiful. Um, they're tucked away in uh, rural south, south Nigeria. So almost kind of along the coastline, just like a few kilometers in from the beautiful southern Nigeria coast. Extremely reserved, extremely, uh, secluded from any kind of grid infrastructure other than the mini grids that currently serve them. Um, I think I want to come back to the two examples you gave Curtis earlier. One about kind of keeping the lights on an hour later into the night. Right. And the other being, uh, um, refrigeration. Right. Um, a really, really great impactful household use of electricity and a really great business use of electricity on the household side. Um, I think it's somewhat easy to imagine that. Yeah, if I could keep the uh, lights on for an hour later every night that would be fantastic. Um, but in particular the way these communities use that, that um, as you can probably imagine, schools in these communities, uh, still practice corporal punishment because if you know it's, it's, it's old fashioned, it's a little bit more conservative in that way. And students, if they don't finish their homework on time, get, get hit with a, with a ruler. Right. And so in order to avoid, in order to avoid that, if they don't finish their homework before the sun goes down and they can no longer see their paper pre electrification, they just don't go to school the next day. They play hooky so that they don't get beat. Right. Um, with a few hours extra of light at night that enables them to finish their homework, which means they no longer are at risk of that and they end up going to school more the next day, um, just because of electrification. This um, is uh, something that I, you know, I wouldn't have guessed originally coming into this. And it's because of that, it's ah, because of those interviews and it's because of those surveys that we were able to kind of figure out that this is one extremely impactful mechanism of how school enrollment is increasing, increased um, through the power of rural electrification and renewable electrification in particular. Um, the second on um, many of these communities, uh, because there's a plethora of water around, they make a lot of their money fishing. Um, however if uh, you are you know, far far away from the nearest uh, kind of major town where you could go and sell your fish, much uh, of your stock is going to go bad, um, unless you have access to refrigeration. And so one thing that we've seen is uh, very quickly after electrification many communities bough a lot of ice makers. Um, and the ability to keep the fish on ice and keep them fresh for days rather than just hours, uh, is a massive boon to the local economy. And what we see oftentimes is because of that boon, uh, to the local economy, people who live in uh, areas kind of for a few kilometers around that community will move into the community so that they can get access to that extra economic opportunity when they move in. That expands the size of the community and expands the size of the local economy further. It's this great positive feedback loop of impact impacts. Fantastic. One thing to note is that um, I don't know if my, I'll just say for me personally if my electricity costs doubled overnight I would still take a hot shower after this. Um, that is definitely not the case for people who are living in rural Nigeria or really anywhere in rural Africa. Um, price elasticity of demand is an extremely important variable to consider. And so uh, by reducing the per unit cost of electricity through these donations, through Impact Mining and through Sonoda, um, we're able to get these massive add on effects where people are willing to invest more money into the, into electricity. So much so that oftentimes the quantity, the revenues that you can see, the amount of money, the amount of kilowatt hours that people are buying, um, uh, are increased so much that it actually exceeds the uh, tariff reduction that is um, achieved through the donation. So what I mean by that is let's say hey, you know, if we can achieve a tariff reduction of 50%, you can halve the cost of electricity the use of electricity might even more than double, which means that positive feedback loop of impact that I talked about, um, can grow even faster than you might expect.

Speaker B: Well, like if you're, if, if you're a business or you're, you're, you're entrepreneurial, you're a fisherman, or you're doing something with agricultural, or you're trying to, you know, make a manufacturer a small product, you might be doing everything by hand because you're not going to buy electrical tools because there's not electricity. But then when electricity is expand, now you can look at buying something with a motor to help your process or a refrigerator. It's fantastic. I don't want to pretend that I'm knowledgeable enough about global electricity infrastructure development, but I have read a little bit and watched a good number of podcasts, and I do think sometimes international investment can have a tendency to be predatory that they come in with, whether it's loans or other sort of financing systems. And it really restricts a community and my learning process. Nick, with Austin, one of the things that I really, that I really unpacked, and I hope that you'll explain it to me better and to our audience here, is that an investment in an existing electrical infrastructure system could have a bigger impact than trying to fund something new. Could you help unpack that for me, Nick?

Speaker C: Absolutely, yes. Um, the kind of, the canonical, the canonical example that we engineers hear from class is, uh, the idea of kind of going into a new community and building a well for people, people building a new water well. And then, you know, uh, within a year that, that well is completely defunct, no longer functional, and all of that time and energy and money that you spent building that would have been so, so much better just invested into the community and the resources that already exist. Right. We have across the continent, 25 communities with a proven track record of productive use of electricity. They are using that electricity, um, to reinvest into their communities, to grow their local economies, to, uh, educate their students, to, um, just build healthier workforces. We mentioned the hospital in Oliviri. Right. One of the first things they did when they got electricity is buy a refrigerator for vaccines so that they could vaccinate their populace and, uh, just massively, massively improve health outcomes across the community. Right. Um, all of that is unlocked through electrical infrastructure, which we already have in place and which is already producing these impacts and has the potential to multiply those impacts several times over, over with additional investment. Um, we've been collecting data on not only the impacts, but Also the consumption patterns of these individuals. We know exactly what these communities need through conversations with the community that are backed by this data we've been collecting from their consumption patterns, um, and we can put nearly infinite money to work immediately, um, to make these lives better.

Speaker B: And to make sure. I'm going to give the floor back, uh, to you here, to make sure I understand the model correctly, is that you're already generating electricity, these communities are already using electricity. But now that there's this impact mining, um, donation channel, you're able to actually lower the cost of electricity for these existing communities. And then therefore that has that flywheel effect where more electricity gets used, more hospitals have refrigeration for vaccines, more school kids, uh, have light bulbs into the night. That is. Do I have that model correct?

Speaker A: You do. So, you know, what we're doing is for every kilowatt hour that is being consumed within these projects, that is a kilowatt hour that now is directly having, uh, the cost reduced through donations. And so that's where the impact is direct and it's transparent and it's immediate on the people who are part of the project. So to the point Nick is making, when the price of electricity is reduced, we're going to see the, uh, intended effect being more electricity is going to be consumed for productive uses. And I think that's the other piece of impact mining that becomes really powerful is our greatest outcome or measure of success will be to be able to see energy use climb within, uh, the projects that are part of the impact mining initiative. So that's the goal, is increase energy use. And I think it's a unique thing, uh, a unique way to sort of frame up. Well, what is it that we want to accomplish? It's more people using energy because it's more affordable.

Speaker C: Exactly.

Speaker B: Increase energy use. That is, that, that is the desired outcome. Uh, electricity leads to human flourishing. And it's just amazing to see the three of us. I'm so lucky. I'm so lucky to be in this room. You know, speaking of being lucky to be in this room, Austin, I feel like if you're, if you're a great chef and you're trying a new recipe, you might invite one of your friends over before you try to serve it at your restaurant. And much my, you know, because I'm, you know, we're, we're a bitcoin miner. I'm, I'm all in on bitcoin mining. As you were developing, um, this, um, this platform, impact mining, maybe I was an easy person to, to Ask. Hey Curtis, you know, come, come and come and taste this recipe. But Impact Mining doesn't stop here. With these two projects there, there is a big future in front of it. And you know, my understanding is, is that you're, you're still working on the, the tech strategy because there's something compelling here and you're still working out. Um, you model. Could you share with me and Nick in the audience what, what's the future? Impact Mining.

Speaker A: Yeah, well, and I think first, you know, before I answer your question Curtis, I'll say, you know, to the point of Impact Mining is, is, you know, we're starting today, but it's, it's meant to scale and grow into something much more significant and impactful on the ground. Um, so I think that's why, you know, Renuvia is, is a great partner for us. Not only being aligned on uh, having the right relationships with community, understanding where the most impactful projects will be, uh, but as Nick has mentioned, 25 additional mini grids throughout the continent that are where we can look to develop the next set of projects and extend this impact. So as an initiative, Impact Mining is designed to grow and it's designed to grow uh, quite significantly. Our goal uh, for this initiative is to reach a $30 million run rate before the next Bitcoin, uh, Bitcoin having, um, and so when you do the math of today's prices, uh, that's putting you less than a quarter of a percent of global Bitcoin hash rate. Now to the point on the tax side. Well, these thoughts ask the question, what is going to motivate, um, someone to want to donate their hash rate to Impact Mining? Uh, the first thing which we've already talked about today is that it is ah, direct, it's transparent and it's immediate in terms of its impact. Impact. Um, but the second thing would be the opportunity for tax advantages. And so when you think about what we're doing here, um, we're looking to expand productive uses of energy where they will have a ton of value in communities, uh, on one end so in Africa. But when you think about the inverse situation here in the US or uh, wherever Bitcoin mining exists, you can think about your for Impact Mining where actually are the least productive parts of my operations. And can I uh, look at hash rate donations because they would be appraised at the cost of the hash rate themselves and can be treated as property. Um, and so this is something that becomes potentially very interesting in providing favorable bottom line economics to Bitcoin miners. Um, as a tax strategy and furthermore, uh, you know, it's not being taxed. The, you know, the bitcoin rewards would otherwise not be taxed as income. Um, so this could be a great setup for miners and it's something that you know, we are going to be, you know, moving forward with and as part of impact mining initiative, how we can work with the bitcoin mining community seamlessly to make those hash rate donations, just a slice is what we're asking for today and then convert that into the impact on the ground and uh, these community communities.

Speaker B: Austin, that's amazing. I'm, I'm proud to know you and I'm proud to see what you've built in this partnership with Renuvia to, to launch. I certainly hope that as things develop, you'll keep us posted, you'll include us in the conversation and let us know um, how we can help as we, as we get close to uh, to wrapping. Nick, I, I want to take advantage of having a, you know, you're, you're obviously you care about um, energy abundance in communities that don't have it and you're like literally, um, their boots on the ground building renewable um, generation. And uh, I am a bitcoin miner. That's my passion. So I think I'd be remiss if I didn't try to unpack this little bit of a topic. Austin has pioneered a donation model which I think is really fundamental and the bitcoin community is going to love it. But I'm on the end where we're still plugging in machines and the systems that you install or have installed, do you have wasted kilowatts that you've created the electricity and uh, because of whatever reason it's not being used that day. Is there, is there curtailed wasted energy inside of your systems where if there was a unique way to monetize that it would be helpful to the community?

Speaker C: Definitely neither in Isuzu nor in Oluibiri. There are some sites, um, sometimes mini grid developers have some problems, particularly with the seasonality of sunshine. Right. If you're trying to build a community that's able to provide as much like 24,7 power during the rainy season, it's going to have, you know, wasted kilowatt hours during the sunny season. Right. Um, so that's definitely a concern. Um, and actually there are some cool companies out there right now doing bitcoin mining in mini grids to start to curtail this exact problem. So far, uh, the um, so far the, the capital required to Add uh, to add bitcoin miners to mini grids hasn't shown to be economically viable, just like because of the payback period is, is often quite substantial. Um, but it is an exciting kind of burgeoning new field within uh, within the mini grid space and I'm excited to see where it goes in the next couple of years.

Speaker B: Well, what a dialed in and robust answer. Let me, I, I do want to, you know, give you the mic for some closing comments and I, you know, I've got something really, you know, I want to ask more about what Renuvia is up to besides this, but I want to, I want to finish on that, that thread. Um, I think you obviously understand that you know, there's that chance that bitcoin miners could come along beside the, the

Speaker C: project,

Speaker B: that excess electricity. But you've mentioned that so far it looks like the capex, it just doesn't make it economically, you know, um, conducive. Um, I'll go ahead and put my, myself out there. So for one, we, you know, we, we're operating, operating 22 facilities, mostly north America. We have an international footprint. We run global logistics. We're, we're a global company and growing that way. We um, care about people, we care about electricity and we understand bitcoin mining. Mining. So I, I can't uh, I can't ship you, you know, everything for free. But if there were a way to get started on a small project where we could come in and stand beside you, you know, on the ground with some sort of, you know, a minor setup and you know, where, you know, potentially we could just donate it as a use case and then if we're able to, you know, grow to something where they're, you know, they're in any sort of combined initiative. But I would personally love to be involved. My leadership would just be thrilled that I'm sitting here, think compass help. And that's the question is how can compass help? So as our relationship continues, if you see a way, it's like, listen, here's, you know, here's, you know, 200 extra KW that's just not being used. Let's plug in, you know, a couple bitcoin miners beside it and, and I'll do that lift. You'll, you'll have to, you'll have to handle customs, but I'll, uh, I'll get them sent to you. Um, uh, Nick, I, I do want us to move towards wrapping up, but I, I feel like Austin and I are here, we're peeking into your um, into your backyard. But you're, you're not just building renewable generation to, you know, to partner with Bitcoin. You guys are, are fully operating. You're building this. And we're just one of the solutions you're coming in beside to, to be a part. Would you, would you talk to us? What, what's Renuvia up to for the next 12 months? What's the future look like for you and your company?

Speaker C: Don't, don't tell yourself too short. I am extremely excited about this collaboration and I think it really does have an uh, opportunity to impact, impact many people's lives in an extremely positive way. And just for what it's worth, Curtis, I would love to partner with you. I could imagine a scenario in which after the mining rigs kind of paid themselves back all of the time and resources that it took to fund them and get them plugged in. You can imagine the rest of it could go towards tariff reduction or expansion capital for the mini grid or whatever the case may be. That could be a very exciting opportunity. What Renuvia is up to in the next 12 months, I'll say on the uh, on the mini grid side of things, we have an extremely robust pipeline. Currently we're building 50 new projects across the country of Nigeria. We're expanding that same project that I talked about earlier in uh, in the community that went from 500 to 3,000 connections. That project is so successful that we are currently in the process of expanding it again. Construction is about to start in a couple months to expand that from 3,000 connections to about 19,000 connections. Um, we have four mini grid projects going up in Ethiopia shortly and uh, we just won our first ever bid in Somalil. So very excited about the exponential growth potential of Renovia. Um, there's, ah, yeah, the, the, the market for, for uh, mini grids has I think become very challenging for many other mini grid developers in the space. And we've just found exponential growth potential in the excitement uh, around investing in rural electrification solutions that can actually be both extremely impactful and also extremely profitable for the uh, for the investors, uh, who kind of provide the upfront capital capital which as you can imagine is quite extreme. Right? Like the millions of dollars necessary to build large scale mini grids, mini grids that serve thousands of people is quite extreme. Um, and uh, the payback period is very, very long. We're talking like five, six, seven years to pay itself back. But then the mini grid continues operating for the next 15 years after that. Um, and just kind of you reap Those returns over and over and over again with extremely low operating. Um, so yeah, on the mini grid side we're very, very excited. Um, we have many, many projects coming up. We're constantly, you know, redeveloping our uh, our engineering technology behind it to use uh, all the data that we've collected from our years of operation on the continent to further optimize mini grid design, mini grid construction, mini grid operations and maintenance, incorporating uh, a lot of machine learning technologies into building uh, better mini grids faster and cheaper and more efficiently and in ways that maximize impact for our customers. Customers. We also have a carbon asset platform that I mentioned earlier using uh, actually blockchain based technology to uh, to track carbon assets like renewable energy credits and carbon credits for large corporate off takers generating additional revenue for mini grids which can, you know, then be used for the same things that we're using Sonoda for. Right? Uh, to uh, to reduce tariffs, to increase capital for expansion to make mini grids even more exciting for investors that we can build more of them that. Right. Um, there's a lot of really exciting things happening at Renuvia.

Speaker B: I come back to how we started. You, you weren't sure you could match my energy? You can match my energy, sir.

Speaker A: Austin, you see why we're excited to have these guys as partners. They're incredible. Um, yeah, tons we can do together.

Speaker B: Austin, you have, you have, you have really cool friends. I want to ask you as we wrap, I want to ask you about Bitcoin Las Vegas in m. A couple weeks and if Sonoda is going to be there, there. But let's use that as an excuse to uh, say to Nick, Nick, I've not been to Africa yet. Eric, uh, Hersman in a large group, um, um, Marshall Long and others host an annual conference. It's typically in September, the African Bitcoin Conference. It would be my pleasure if we could try to um, meet each other uh, there. So I think you're going to feel a warm welcome to the Bitcoin community and why don't I make sure that you're aware of that conference and maybe you can uh, you can make your way there.

Speaker C: It's in Kenya, right? Like on the Swahili coast. Yep, I, I am, I'm excited to go to it. Yes.

Speaker B: That, that's, that's amazing. Austin. I'm, I, I'm gonna, I, I'm gonna give a little outro about Compass in our, in our presence at uh, at Bitcoin Las Vegas. What about you? Are, are you going to Be heading out there, uh, in a couple weeks.

Speaker A: Yes, I'll be, I'll be in Vegas and, and looking forward to meeting folks. Folks, uh, out there.

Speaker B: Of course. Course.

Speaker A: Uh, it is the Bitcoin conference that really has been an incredible part of uh, my story personally, uh, but also our company story. And so I can sort of track milestones of the company with this conference. So would never miss it. I think they always do an incredible job. And uh, this year being in Vegas, uh, I think the energy level is going to be extremely high. Uh, so I'll be getting good rest before heading out of town. I uh, look forward to seeing you there.

Speaker B: That's awesome. That's awesome. Austin. Um, you know you mentioned and we talked about it, ah, Impact Mining is just beginning and that our primary audience is going to be the existing bitcoin mining community. You know, we've got 12,000 unique customers. This is, you know, this, this podcast is consumed by people who mine bitcoin. Um, are you ready for other people to reach out and see how they can get involved or how does they pay attention to learn more in the future?

Speaker A: Yeah, so, so there is going to be a website, uh, Sonota IO, uh, so that'll be the, the best way to uh, to, to learn some more details about the Impact Mining initiative, uh, and see the details of, of the two projects that, that we highlighted here today. Uh, but you know, as I said, of course the, you know this is really the starting point for Impact Mining is you know, this conversation and the work that, that we've had, uh, the opportunity to do with uh, with Compass Mining being our, our anchor don here. Um, but where we go from here is to open Impact Mining up to the broader bitcoin mining community, uh, to provide more of the resources and education that will support uh, donations through this platform. Um, and to really maximize the benefits, not only that bitcoin, uh, miners making the donations get, but also uh, to show how those benefits are uh, being converted into impact on uh, the ground. Um, so yeah that, that'll be the place to, to see everything that's happening with this initiative. Um, and for folks to, to contact us to, to see how they can participate.

Speaker B: Well, we will 100% include that link and not just the link. We'll, we'll, we'll make it loud and clear so people can, can learn more. Uh, Nick, in my due diligence I was able to watch a video of you when you traveled to China during your undergrad. But I did not unpack what your favorite social Media or email is. Is. Or maybe it's just Renuvia's website. If this audience wants to learn more about you and your amazing work, where should they go?

Speaker C: Yeah, Renuvia's website. Remember we were talking earlier about the kinds of tech people. I'm not on Instagram or Twitter or anything, so sorry. And also, yeah, just go to Renuvia's website. You can learn all about the amazing work that we're doing.

Speaker B: You, you are not missing anything, sir. In fact, that's a, uh, that's a great answer. Okay, so you can tell a good conversation. We, we wanted to, you know, maybe talk for 45 minutes and here we are pushing an hour. Uh, gentlemen, this has really been my pleasure. Congratulations to you both. Is, this is um, uh, um, amazing work that you both have dedicated your careers to. I really feel fortunate to be, to be involved and honestly, I think this is my first time to uh, spend an hour with two PhDs. I'm certainly coming away smarter. I hinted at it earlier. Compass Mining's going large into uh, Bitcoin Las Vegas. We're going to have a booth. It's booth number 930 in case you're and track. We're going to have 13 total people from our team there, from our two, um, co founders to uh, our chief mining officer, chief revenue officer, myself. Eight other people work in the booth. It's going to be amazing. So if you have a chance to come by and see us, we've got a, a promotion where we're doing a free week of hash rate. So you can simply try our product for free and some substantial discounts. So I would invite anyone in Las Vegas to come by and see us at our booth. Um, Austin, thank you. Nick, thank you. What a great conversation. See you next time.

Speaker C: My pleasure.

Speaker A: Thank you.