Senator Ted Cruz introduces the FLARE Act to boost Texas Bitcoin mining with flared gas - IcoHolder.

United States Senator Ted Cruz has unveiled a groundbreaking bill aimed at reshaping the landscape of cryptocurrency mining in Texas. The Facilitating Lower Atmospheric Released Emissions Act, or FLARE Act, promises to position Texas as the leading hub for Bitcoin mining by incentivizing miners to harness flared natural gas for their operations.

In a move that could significantly impact both the cryptocurrency industry and the environment, Cruz's bill proposes changes to the U.S. tax code. Under the FLARE Act, companies will be able to fully deduct the cost of systems designed to capture and repurpose natural gas that would otherwise be flared or vented. These systems, which include flaring and venting mitigation technology, would be eligible for a 100% expensing deduction starting in 2026.

The systems must convert the captured gas into usable energy forms, such as electricity, liquid fuels, or computational power for digital asset mining. Other eligible uses include powering oilfield equipment or the electrical grid and producing petrochemicals and fertilizers. By allowing for full expensing, the bill aims to encourage the creation of more sustainable energy solutions, particularly in Texas, where excess natural gas is often wasted.

Notably, the FLARE Act includes provisions to block foreign entities from reaping the benefits of these incentives. This clause specifically targets countries like China, Russia, Iran, and North Korea, ensuring that the tax breaks are reserved for U.S.-aligned operators. Cruz emphasized that this measure would strengthen the country’s energy independence while fostering innovation in the energy sector.

The bill has already garnered support from key players within the industry, who see it as an opportunity to both reduce emissions and unlock previously wasted energy. Bitcoin mining company MARA Holdings, for example, has endorsed the legislation, highlighting its potential to tap into stranded natural gas and reduce environmental impact.

MARA’s recent partnership with NGON to establish a 25-megawatt micro data center using excess natural gas to power mining operations further exemplifies the benefits of the FLARE Act. By converting flared gas into electricity, the company offers an efficient solution to methane mitigation, aligning with the bill's goals of reducing emissions while promoting energy innovation.

In his announcement, Cruz emphasized the win-win nature of the bill, which he believes will cut emissions, bolster grid resilience, and elevate Texas's status as the epicenter of the Bitcoin mining industry. “This bill takes advantage of Texas’s vast energy potential, reinforces our position as the home of the Bitcoin industry, and is good for the environment,” Cruz said.

The introduction of the FLARE Act marks a significant step in transforming waste gas into a valuable resource, turning environmental challenges into business opportunities. With support from the industry and a clear vision for energy innovation, the bill is likely to garner further attention as it progresses through Congress.