Bulls Gap crypto company gets construction permit

BULLS GAP — ExoticRidge Crypto Company received its construction permit from the Tennessee Department of Environment and Conservation's air pollution division. The permit concerns two dual fuel engines that are already on the company's Bulls Gap site, but not in their final positions due to regulations. ExoticRidge CEO Will Daugherty said the permit allows him to move forward with any piece of the construction process directly related to the generators, like pouring concrete pads for their permanent location. Other construction was already allowed. The construction permit also acts as a temporary operating permit, although ExoticRidge cannot legally run a crypto mine or data center under Hawkins County law. The county banned this practice in a Sept. 22 meeting after public outcry regarding ExoticRidge's plans to set up shop. TDEC's permit does not give ExoticRidge permission to violate the county's ban. "We're still trying to work with county leaders to figure out a path forward," Daugherty said. "The game plan here is to continue working with the county to figure out, hopefully, something that works for both of us." The permit is valid until Jan. 6, 2028, but Exotic Ridge must apply for a conditional major operating permit within 30 days of startup. TDEC said in a written statement to the Kingsport Times News that this timeframe is consistent with all other construction permits issued by its air pollution division. It also said a permittee could be denied an operating permit if it fails to comply with the regulations to protect human health and the environment, but this is rare. "Compliance with [construction permit] standards or limits is often assured if the source is constructed as applied for, operated as anticipated by the permit and is not modified in such a way as to increase its capacity," TDEC Senior Communications Advisor Jennifer Donnals wrote. "Compliance is also demonstrated through source specific monitoring, recordkeeping and reporting requirements written into permits. The [air pollution division] regularly inspects facilities to ensure they are complying with their permits." ExoticRidge opted out of being issued a major source permit, which would have had higher limits for air contaminants. The company agreed to limit its emissions and natural gas usage. If the site used solely natural gas for fuel, it would emit enough pollutants to warrant a major source permit. But, Daugherty said, ExoticRidge intends to mostly use ethane for the generators. This ethane is the byproduct of the nearby Bulls Gap Frac Company, which otherwise emits a flare. ExoticRidge would use natural gas as a supplemental fuel, Daugherty said, in case the ethane supply ebbs and flows. "Based on the duration of the engines and the calculation of emissions on ethane, we're well within the minor permitting realm. And that's where we intend to remain," Daugherty said. Due to the opt-out, ExoticRidge is classified as a conditional major facility. Donnals said these kinds of permits tend to be more rigorous, with more inspections, to ensure the lower limits are met. ExoticRidge's emissions, however, are a moot point unless the county lifts its ban on crypto mines and data centers. "We're happy to have this piece of the puzzle completed and affirm the process we initiated last year," Daugherty said. "We hope we can get to a point where we can utilize it."