Bitcoin mine spokesman says dealing with noise issue “our number one priority”

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JONESBOROUGH, Tenn. (WJHL) – Davey Funderburk said he and his wife and kids can no longer hear the peaceful sound of the Nolichucky River in the mornings and evenings. It’s drowned out by the incessant hum made by dozens of fans cooling computer equipment at a bitcoin mine more than a mile from their rural home.

“Now instead of the river though we hear a constant roar and we hear it during the most peaceful parts of our day, the morning and the evening,” Funderburk said. “And we live over a mile from the Red Dog station.” 

Funderburk and a handful of neighbors told Washington County commissioners during public comment period Monday night they want communication with the mine’s owners and some type of fix to the noise. They said mine owner Red Dog Technologies hadn’t reached out to them about a well-publicized problem that’s been going on for several months.

All they’d had to hold onto until Monday was a late June statement from Red Dog and BrightRidge, the power distributor that is selling Red Dog power from its Bailey Bridge Road substation and leasing land next to it for the mine operation. That statement said the partners were collecting data and working on ways to mitigate the noise.

Red Dog Technologies’ Bitcoin mine is adjacent to a BrightRidge power substation in rural Limestone, Tennessee.

“We would like to know the plan, the timeline, and regular … biweekly updates to show the progress so that we know it’s not just being shuffled aside,” Funderburk said.

Commissioners have wanted answers as well. They approved a BrightRidge rezoning request in February 2020 that paved the way for the project.

The request never mentioned bitcoin mining and said noise from fans wouldn’t be noticeable by adjacent properties.

Monday night, with BrightRidge on the agenda to discuss the issue, neighbors and commissioners began to get answers straight from the horse’s mouth.

After brief remarks, BrightRidge CEO Jeff Dykes introduced Todd Napier of Red Dog. The company’s “mine” is a collection of metal buildings housing high-powered computer graphics cards that solve complex mathematical equations.

It’s all part of the lucrative world of “blockchain technology,” a basis for cryptocurrencies like Bitcoin. And that computer equipment runs hot, necessitating the fans that are the source of the noise.

Red Dog’s contract with BrightRidge — it became the power distributor’s largest customer nearly overnight — calls for most of its usage to occur during “off peak” hours when it can get the cheapest electricity.

Speaking after the comment period, but facing a litany of questions from commissioners, Napier said Red Dog wants to be a good neighbor.

Todd Napier of Bitcoin mine owner Red Dog Technologies speaks at Monday night’s Washington County, Tenn. commission meeting.

“I want to begin by assuring you that we have heard and that we are taking very seriously the concerns of those that live by the Red Dog facility regarding the level of sound that’s being produced,” Napier said.

He added that the sound issue is “our number one priority.”

Napier addressed the lack of communication to date.

“We’re here this evening to enter into dialogue,” Napier told commissioners as residents sat in the gallery. “I know you said you hadn’t heard anything from us and certainly we’re here to do that.” 

Commissioner Bryan Davenport began.

“Are you having this kind of issue at the other site?” asked Bryan Davenport, referring to a mine in Maynardville that uses power from Knox Utilities Board. 

Napier said no.

“What’s the difference?” Davenport asked.

“This is a larger site than our other active existing site, so you know that may be part of it. It’s a little bit different design.” 

During his exchange with Davenport, Napier acknowledged the facility has capacity for even more equipment. Several audience members gasped and murmured at that comment, but Napier said no additional units will be installed before the noise fix is completed.

Commissioner Freddie Malone said he had reviewed the rezoning request. “What was described for the site was I think different than what we’ve ended up with,” he said. “I’m a little disappointed in that.”
Malone said the request referenced computers and “small fans.”

“Having been down there, the fans are not small fans. I feel like I didn’t, I was not well-educated on the front end about what was going to be there and in fact perhaps small fan was a little misleading.

“I don’t know where that came from but I feel bad about the basis upon which we made the rezoning decision.”

Malone’s remarks drew applause from the audience.

Dykes responded by saying “I know in the request to rezone it talked about blockchain data center, which is what this thing even though it’s mining Bitcoins it could be any type of data center.”

But he said the fans on the microprocessors are small. “I can tell you there was no one on the BrightRidge side that certainly was looking to mislead or anything. It was a blockchain data center which has microprocessors and the cooling requirements for that.”

Prior to Malone’s questions, Dykes had repeated BrightRidge’s rationale for courting Red Dog in the first place. He spoke of declining residential power usage as a result of energy efficiency and the departure of one major industrial power user (Kennametal) and shutdown of another (Hexapol).

“Anything we do in economic development is bringing industries that can of course bring revenue to the electric utility,” Dykes said. “And the reason we do that is to help us stabilize rates so we’re not going every so many years and saying we need a rate increase.”

That was the case with the Red Dog facility, he said. At full capacity it would use enough electricity to power more than 10,000 homes.

“One of the good things that came out of what is being made there now is we lost two large industries on our system this year, and this is actually covering the losses of that revenue,” Dykes said. “So again, it’s doing similar to what we think, it’s helping stabilize rates for our customers.”

Napier said Red Dog will communicate more transparently and is setting up a dedicated email address for communication with residents, comments@reddogtn.com.

He insisted the company wasn’t just there Monday to pay lip service to the issue.

“The plan is not to say, ‘hey, you know, maybe they’ll get used to it, you know, we’ve not got a problem,’ – just to walk away. That is absolutely not in our plan, it’s not who we are. We’re committed to keeping you informed.” 

To that end, the company has contracted with a highly regarded consultant specializing in acoustic engineering. That company, WSP, is developing an acoustic model and providing advice on what Red Dog can “reasonably implement,” Napier said.

Many residents would need convincing after weeks of noise from the mine – and silence from Red Dog. 

“I’ve always heard with big business it’s better to ask for forgiveness than to ask for permission and I think that’s probably what’s happened here,” Gary Higgins said. “Once they got it in, which they did, they’re in.” 

In addition to seeking ways to best dampen the noise, the company is also working with the local arm of ebm Papst, a German manufacturer of refrigeration equipment, looking at the possibility of finding fans that make less noise.

While Napier said more than once the company will do what it can “reasonably implement,” Higgins suggested the company’s bottom line will still come first. 

“They’re running those fans louder and it’s getting louder all the time and they’re gonna run them as fast as they need or put whatever they need to cool their equipment,” Higgins said. 

Red Dog and Brightridge will be back for an update at the commission’s August meeting. Sound data is still being collected.

EARLIER STORY

Neighbors of a Bitcoin mine in whose powerful fans have produced high noise levels night after night for months hope the power provider that sells electricity to the mine’s owners — and essentially brought them here — will have some answers for them at a county commission meeting Monday night.

BrightRidge is set to report on noise mitigation efforts at its Bailey Bridge Road substation in the New Salem community of Limestone. Some pasture and Lola Humphreys Road are all that separate Preston Holley’s home from the Red Dog Technologies mine and Holley said the noise continues unabated.

“We’ve not seen any real change,” said Holley, who plans to attend the meeting. “It is continually, it’s loud. And it’s on all the time.” 

Holley did say BrightRidge sound monitors were placed in his yard and several others for a recent two-week period.

BrightRidge had been scheduled to address Washington County commissioners at their June meeting. That was postponed so BrightRidge and Red Dog could gather more data about noise levels, sources and sound travel, and possible mitigation.

BrightRidge released a statement in late June saying it and Red Dog were working toward solutions and hoped to have much more clarity by late July.

Holley said he hopes commissioners – who in February 2020 approved the rezoning that allowed the mine – will ask tough questions tonight. The zoning request did not mention a separate business or a Bitcoin mine, and it said noise from the “blockchain data center” wouldn’t be noticeable from adjacent properties.

BrightRidge officials said in May they had visited a similar Red Dog facility near Knoxville and come away with that conclusion.

“Now that the commission really has time to listen to this and discuss it, it’ll show where we can really go, if we can actually get something done about it or not,” Holley said. “(Commissioners) who have made some comments about it do act like they are really bothered by how it changed our community. It wasn’t what they expected. It wasn’t what they intended on this being.”

Red Dog uses the vast majority of its electricity during “off-peak” hours. That’s when the fans cooling high-powered computer graphics cards make the most noise as the computer equipment solves extremely complex mathematical problems that help verify Bitcoin’s security and also “find” new Bitcoins.

“There are quieter moments in the early afternoon but that’s usually when everybody’s gone to work,” Holley said. “So from 8 o’clock in the evening until late into the morning, well, it roars.” 

At full capacity, BrightRidge said the operation could use enough electricity to power more than 10,000 homes. Red Dog quickly became BrightRidge’s biggest customer, largely using power that essentially sits on the grid in the middle of the night.

Holley said he’s become somewhat accustomed to the sound, although when the off-peak power period arrives “it comes back on full force and really fast, and it doesn’t let up.” 

But he doesn’t think people in the community should have to just adapt to the current noise level. 

“The fact that they came into our community with misinformation to everybody, from Brightridge all the way down to us, they need to at least answer to it and acknowledge that this is what’s happened and that ‘here’s what we hope to do about it.’” 

Holley has his plans for the evening set. 

“Make sure that the commissioners and the community knows that this has really affected our community in a negative way and we do first of all want to know that they acknowledge our concerns,” Holley said. 

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