In the middle of a former construction waste site, just about 26 miles north of downtown Raleigh, stands what looks like six gigantic turkey fryers.
These cylindrical contraptions aren’t devouring birds, though. Rather, they are part of a complex machine that is attempting to turn old tires into a reliable and cheap form of energy.
And if its owners, Product Recovery Technology International (PRTI), are successful, these machines could be placed across the country.
PRTI calls the process “thermal demanufacturing,” and the machines break down tires into oil, syngas, carbon char and steel.
In the PRTI playbook, almost all of those commodities will stay on site in Franklinton, where they will be used to power a data center mining various cryptocurrencies 24 hours a day.
Over the past 10 years, cryptocurrencies have arrived en masse on the scene. Just in the past year, Bitcoin, the most popular of the digital currencies, has skyrocketed in value in the past year, and reached highs of more than $60,000 a coin.
But the energy generated in Franklinton ultimately could be harnessed for many uses.
“We have started in a modest way,” said the company’s CEO, a fast-talking Brit named Chris Hare. “But we believe we can demonstrate a very scalable technology.”
How to dispose of used tires
PRTI was started in 2013 by Wayne Machon, who came across an R&D project in Italy that baked tires to a specific temperature point instead of completely burning them.
Machon, a retired former executive in the semiconductor industry, saw potential in it, and spent six months in Italy studying whether to take it back to the U.S.
The immediate need for the product was obvious to him. The disposal of used tires can be a huge headache and nuisance.
Up until the mid-1980s, most tires were simply thrown away, by the millions, into dumps, said Morton Barlaz, head of N.C. State University’s Department of Civil, Construction and Environmental Engineering.
You couldn’t bury them, as the tires trapped air, which caused them to work their way to the surface. Plus, while they were in the ground, they could contaminate the soil. So, they were stacked on top of each other into piles that sometimes resembled small mountains.
“The problems with those dumps is that once you get water into a tire, they become mosquito breeding grounds,” Barlaz said in a telephone interview.
They were also a huge fire hazard.
“And when you burn a tire,” Barlaz said, “you are releasing a whole bunch of air contaminants. You also produce an oil that can contaminate groundwater.”
Each year, around 300 million scrap tires are thrown away in the U.S. alone. In 2019, around 76% of those tires were recycled into new products, like asphalt or “tire-derived fuel,” according to the U.S. Tire Manufacturers Association.
Hare says that still leaves millions of tires that need to be re-used. “What matters in the circular economy is: How do you take someone’s trash and turn it into value?” Hare said. “This is a business that takes a terrible, awful waste stream and does something with it that is financially beneficial.”
PRTI sources most of its tires from tire manufacturers in the state, as the actual shipment to its facility is one of its biggest costs. Many of the tires it processes are ones that didn’t meet standards to be sold. Since 2020, PRTI has also partnered with the Durham-based startup Spiffy to take on the scrap tires its on-demand car servicing generates, The News & Observer reported.
The company now believes they have improved the original Italian version of the machine to the point it can be relied upon.
Each of the thermal demanufacturing cylinders now handles 6,000 pounds of tires at a time. It takes 11 hours to break down the tires, and PRTI tries to run two cycles a day every day of the week. The N.C. Department of Environmental Quality granted the company an air permit in August 2020.
The process, Hare said, is automated by an algorithm that regulates the temperature and length of each cycle depending on the types of tires being used. That help keeps labor needs low. The company currently employs around 20 people.
While the current site has six chambers, PRTI believes it would be possible to operate as many as 16 at one time.
PRTI has raised around $10.5 million since it was founded in 2013. Hare said the company has raised significantly more than that, though he declined to say how much. The company is currently looking to raise money to finance the expansion of its concept.
One of its investors is Jason Williams, a Triangle entrepreneur who started FastMed Urgent Care and sold it in 2015. His arrival brought a more pronounced cryptocurrency focus to PRTI.
In recent years, Williams has remade himself from a healthcare entrepreneur into a sort-of cryptocurrency guru. He’s written a book on the subject and created an outsized social media personality where he touts Bitcoin to his more than 100,000 Twitter followers and shows off his lavish lifestyle.
He acted as CEO of PRTI until last year, when he became the executive chairman and passed the torch onto Hare, who he partnered with at his former investment firm Full Tilt Capital.
PRTI works in many various coins, including Bitcoin and Ethereum, another popular digital currency.
“What’s interesting in crypto is it’s a way to monetize energy,” Hare said of PRTI’s thinking.
Similar to the problems with scrap tires, cryptocurrencies have proven to be an environmental challenge.
The “mining” of cryptocurrencies requires huge amounts of computing power and continuously uses electricity. Miners use the computers to validate transactions of Bitcoins and earn new ones, but to do that, the computers must solve large math problems that only can be done by large computers.
In China, where most of this mining is done, Bitcoin mining is forecasted to generate 130.5 million metric tons of carbon emission by 2024, according to a recent study in the academic journal Nature Communications. Put another way, by 2024, Chinese Bitcoin energy consumption would exceed the total energy consumption of a country like Italy and exceed the greenhouse gas emissions of a country like Spain, Bloomberg News reported.
North Carolina doesn’t naturally make sense as a place to put a data center that can mine cryptocurrencies. That’s because it gets really hot and humid here in the summer. Most of the largest ones here — like Google and Facebook’s large data center in the western part of the state — were built here because state incentives were offered.
At PRTI’s Franklinton site, the second floor of the company’s office is mostly a server farm now. The computers create a low roaring noise, and the rooms they occupy are kept at much lower temperatures.
“Most of the big data centers in the crypto space are in low-ambient temperature areas, like Iceland or places that are very inexpensive from a power perspective,” Hare said. “North Carolina isn’t that. Doing what we are doing, where we are doing it, it is unusual.”
But it also works as a proving ground for PRTI. If it can find a cleaner and cheaper way to run a data center in the Southeast, then they believe more people might want to replicate its set up.
“Right now we have a sample of one,” Hare said. “But you start building the next or third one, and it becomes repeatable.”
This story was produced with financial support from a coalition of partners led by Innovate Raleigh as part of an independent journalism fellowship program. The N&O maintains full editorial control of the work. Learn more; go to bit.ly/newsinnovate