According to our studies in the previous article (https://medium.com/@zodhyatech/do-bitcoins-consume-more-electricity-than-our-country-3cc354a6c191
), Bitcoin consumes around 32.56 TWh. This consumption itself translates to a country consumption equal to that of Denmark.
Now we have to estimate how much electricity the banks consume. For this comparison, let’s just include three areas: server costs, branches costs and ATM costs. Of course, banks (and its employees), consume a lot more electricity from other sources but let’s focus on major infrastructure.
The next number we need is how many servers each bank uses to run their banking infrastructure. Picking a very conservative number of an average of 100 servers per bank (keep in mind banks need servers not just for the banking infrastructure but for the bank internal operations as well like ERPs, CRM, accounting systems, Website, etc.). If a server in average consumes 400Wh and since it always on, this means that banks consume in total 800 Mwh.
Let’s add to the above the electricity consumption of the branches. According to the World Bank, there are 12.5 branches per 100,000 adults in the world. As the world population is 7.6 billion and we have around 70% adults, this means a total of 665,000 branches. Only in the US, they appear to be close to 100,000 branches and assuming the US is around 15% or less of the entire banking system worldwide you get to around the same number.
Calculating a branch’s consumption turns out to be tricky since there are lots of things to take into account like the size of the branch or number of employees as well as several things consuming electricity like lights, cooling, computers, etc. And they are not open 24 x 365. So after studying some case-studies, I have decided to settle for a conservative number 15 kWh per branch assuming an average branch has 10 light bulbs, two air conditioning units that are used 40% of the time and 12 desktop computers running an average of 12 hours a day, 20 days a month through the year.
And finally, we have to include the ATMs networks that all banks use (that will also not needed in case bitcoin or other cryptocurrencies become the dominant currency and payment mechanism). There are also 3 million ATMs throughout the world. For an ATM with 2 air conditioners and lighting, the average daily power consumption comes around 48 kWh.
So total consumption for banks during a year only on those three metrics is around (I am rounding) 26 TWh on servers, 87 TWh on branches and 26TWh on ATMs for a total of close to a 140 TWh a year...
Banks electrical use > BTC mining / transaction processing.
Who'd of thunk it.