The bitcoin network burns through an estimated 121 terawatt-hours (TWh) of electricity per year – more energy than countries like Argentina and the United Arab Emirates use annually.

Statistics published in Cambridge University’s Bitcoin Electricity Consumption Index have raised questions about the potential environmental cost of the cryptocurrency amid a recent price surge that saw the value of one bitcoin reach $60,000 on Wednesday.

The Cambridge index estimates the total energy use of bitcoin through analysis of the current network hashrate (number of cryptographic calculations made each second), the revenue from mining bitcoin blocks, average electricity cost, and the energy efficiency of both mining hardware and bitcoin-related data centres.

What it shows is a network with energy use that rivals whole nations.

And as the price of bitcoin goes up, so does the cryptocurrency’s energy demand.

Electric car company Tesla’s recent announcement that it purchased $1.9 billion of bitcoin helped drive cryptocurrency prices to new heights, but investors have already flagged concerns about how the large bitcoin investment fits with the company’s renewable energy focus.

Ben Dear, CEO of billion-dollar sustainable investment firm Osmosis Investment Management – which holds Tesla stock – said it was important for Tesla to include bitcoin in future energy consumption reports.

“We are of course very concerned about the level of carbon dioxide emissions generated from bitcoin mining,” Dear told Reuters.

“We hope that when Tesla’s bitcoin ventures are over, they will concentrate on measuring and disclosing to their market their full suite of environmental factors, and if they continue to buy or indeed start mining bitcoin, that they include the relevant energy consumption data in these disclosures.”

Bitcoin’s carbon footprint, like its total energy consumption, can only be estimated – and even then, the headline figures vary wildly.

A 2019 research paper from UK cryptocurrency investment firm Coinshares pegged the amount of renewable energy used to power bitcoin at 73 per cent (with a 5 per cent margin of error), thanks mostly to hydro-electric energy in the Sichuan region of China where it is estimated more than 50 per cent of global mining took place.

In contrast, a 2018 paper from the Cambridge Centre for Alternative Finance estimated renewables made up less than 30 per cent of energy used by bitcoin miners.

Australia generated 265 TWh of electricity in 2019 – enough to power the entire bitcoin network twice over. Only 21 per cent of that was generated using renewable sources.