County commissioners tell BrightRidge CEO they feel misled over Bitcoin mine

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JONESBOROUGH, Tenn. (WJHL) – Neighbors of a noisy bitcoin mine in rural Limestone’s New Salem community found advocates at Monday night’s Washington County Commission meeting.

The support came from the county commissioners, who in February 2020 had unanimously approved a rezoning paving the way for the Red Dog Technologies operation next to a BrightRidge substation just off Bailey Bridge Road.

Brightridge is leasing land and selling power to Red Dog — whose computer equipment adjacent to the substation, or more accurately the fans that cool that equipment, create the noise issue. With BrightRidge’s CEO and a Red Dog representative on hand to explain mitigation efforts commissioners seized on the chance to ask questions and make a few statements.

Commissioner Mike Ford said he had thought BrightRidge was planning a solar farm at the site. The rezoning request mentioned the eventual possibility of a solar farm. It also said the immediate use was a “blockchain data center.”

Ford said that terminology didn’t raise commissioners’ eyebrows the way Bitcoin mine would have.

“I don’t know if it’s Brightridge, Red Dog, black dog or somebody, but somebody misled this county commission and I don’t think there’d a been one person in this room that would have voted for that if they knew what was going to happen,” Ford said.

Freddie Malone had a similar sentiment, saying he and a few other commissioners had gone back and looked at the rezoning request.

“What was described for the site was I think a little different than what we ended up with and I’m a little disappointed in that,” Malone said.

The request mentioned “small fans” used to cool equipment but that their “noise is considered small and will not impact or be heard from adjoining properties.”

BrightRidge representatives had visited another Red Dog facility and left satisfied noise wouldn’t be an issue as shown in their rezoning request.

“I feel like I was not well educated on the front end about what was going to be there and in fact small fan was perhaps a little misleading,” Malone said. “I don’t know where that came from but I feel bad about the basis upon which we made the rezoning decision.”

That comment met with applause from the audience, which included numerous people from New Salem.

BrightRidge CEO Jeff Dykes said the information was technically accurate.

“Even though it’s mining bitcoins it could be any kind of data,” Dykes said. “If you look at the microprocessors (they) have the small fans on them.

“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,” Dykes added.

Commissioner Jim Wheeler told Dykes “once we’ve rezoned there’s not a lot that we can do with regard to this, and you’re aware of that.”

Wheeler said the commission “count(s) on you all as our partner in the community,” and he noted his general judgment of BrightRidge as a strong community asset.

But Wheeler, who serves on the planning commission and thus recommended the zoning change not once but twice, also expressed second thoughts.

“I was on the planning commission at the time and would reiterate what’s been said about the application and that … there’s a lot of regret there,” Wheeler said.

What’s the plan? And what about Lamar?

Commissioners honed in on a couple issues surrounding the Bailey Bridge site — communication, or lack thereof to date, and a timeline and current expectations about noise mitigation.

They also wanted to know who was paying for the mitigation, and whether BrightRidge had any intentions of pursuing further Bitcoin opportunities.

Dykes’s main rationale for the project was the revenue it brings in — at full capacity the Bailey Bridge mine would use enough electricity to power more than 10,000 homes — and how that helps BrightRidge avoid rate increases for customers.

When asked by Malone about whether the site was complete, Napier said there was “capacity on the power system for us to expand,” but that Red Dog has “halted any further action until we get this situation resolved.”

Wheeler later noted that response had elicited gasps from people in the audience.

“If I lived out there and I had been one of the people that was told why we build it ‘in the middle of nowhere’ I wouldn’t feel real comfortable with that (pledge of no expansion), unfortunately,” Wheeler said.

He asked Dykes whether BrightRidge had “any control over that including providing the power to say we’re not going to build any additional more units until we get this resolved?”

Dykes didn’t answer directly.

Ford asked Red Dog’s Todd Napier whether there had been any way for residents, who’ve been complaining about the noise for more than two months, to contact Red Dog and express concerns.

Napier said the company had been primarily communicating through BrightRidge “and following their lead.

“Prior to tonight I guess to get right to the question was there a direct way for them to get in touch? I would say probably not easily,” Napier said.

Malone asked who was bearing the bulk of the cost of remediation.

“There is the concern in the community that the ratepayers are paying a substantial portion of the remediation,” he said, pointing to the fact that a BrightRidge engineer had been the main presence in the community during recent sound readings.

“Those costs will be borne by Red Dog Technologies,” Napier said.

Wheeler asked Dykes to confirm earlier statements that BrightRidge wasn’t taking steps toward another facility. When news of the noise issue broke in May, citizens in the Lamar community expressed concerns about a second site there.

Dykes said at that time BrightRidge leaders had discussed potentially competing for another site at Lamar but were holding off due to the issues at the first site.

“Until they work the issue out and resolve it to the benefit of the community we certainly weren’t looking at any additional sites,” Dykes said. “There was an additional RFP (request for proposals) and we didn’t submit for that RFP.”

In fact, Dykes said Red Dog’s efforts to discover a way to lessen the noise, and the expense to which the company’s going, show its commitment. He said he believes “they really want to bring this thing to a position of where it is a model of what would be customer friendly and community friendly.”

Commissioner Ken Huffine thanked Napier for establishing communication with the community. Red Dog has set up a comment email address.

But Huffine also said neighbors will be expecting significant sound reduction at the bitcoin mine.

“As a percentage what would you think your goal is to be able to reduce that noise level from and to?” Huffine asked.

“I understand, I appreciate your question, but I don’t have an answer,” Napier said. “I don’t. Not without some better guidance from the folks that we’ve hired to help us understand what’s there and what can be reasonably achieved.”

Huffine stayed on the concept of reasonableness and asked if Napier’s claim Red Dog would take reasonable steps was a misstatement.

“I don’t have an answer to that question,” he said.

Ford later asked BrightRidge CEO and Napier point blank, “Would you want to live there 24-7 and listen to that?,” Ford said. “It’d run you crazy as a loon.”

Commission Chairman Greg Matherly asked Napier what “boxes we can check” in August, when Dykes and Napier will return with an update.

Napier said those would include the level of progress made by Red Dog’s acoustic consultant and any information they’ve provided that will give Red Dog a sense of steps they can take to improve the sound issue.

“Or maybe potentially some steps that we have already begun,” Napier said.

For his part, Dykes said BrightRidge wants to maintain its strong reputation with the commission and the community.

“BrightRidge’s goal is to make sure that we get it to the point where the community is happy, and again we’re not moving forward or talking about any additional sites at all at this time.”

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