The New York Supreme Court has ordered the state’s Public Service Commission (PSC) to reassess the approval of Digihost International Inc.’s acquisition of the Fortistar North Tonawanda gas power plant, intended for cryptocurrency mining operations.

The court found that the PSC failed to evaluate the transaction’s compliance with New York’s Climate Leadership and Community Protection Act (CLCPA), which mandates reductions in greenhouse gas emissions.

In 2021, Digihost entered into an agreement to purchase the 55-megawatt Fortistar plant from North Tonawanda Holdings, aiming to repurpose it for continuous cryptocurrency mining.

The PSC approved the transfer in September 2022 without conducting a thorough environmental impact assessment, prompting legal challenges from environmental groups.

The court’s decision emphasizes the necessity for state agencies to consider environmental consequences in their approvals, particularly concerning projects that could significantly increase greenhouse gas emissions.

The PSC is now required to re-evaluate the transaction, ensuring alignment with the state’s climate objectives.

This ruling highlights the ongoing tension between economic development initiatives, such as cryptocurrency mining, and environmental sustainability goals.

The outcome of the PSC’s reassessment may set a precedent for future energy-intensive projects in New York.

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