The cryptocurrency company Greenidge Generation has been allowed to continue to operate its power plant in Yates County for the time being, after a judge ruled Thursday that the Department of Environmental Conservation did not justify its final denial of the company’s permit application.

Greenidge burns fossil fuels at the plant, which sends energy to New York’s grid and powers machines that generate bitcoin. That process puts greenhouse gasses into the atmosphere, which contribute to climate change.

Earlier this year, the DEC upheld its previous decision to deny the company’s request to renew its permit to operate the power plant. The department said the plant’s operations were inconsistent with the state’s climate law, which requires New York to reduce its greenhouse gas emissions by 40% by 2030.

The company sued the state over that denial, arguing that the the DEC overreached in how it applied the climate law.

On Thursday, New York Supreme Court Judge Vincent Dinolfo ruled that the DEC does have the authority to deny a permit under the climate law, but the department’s justification in its final denial in this case was insufficient.

Dinolfo ordered that the DEC’s decision to deny Greenidge’s permit application be annulled and remitted the case to the department, meaning that a lower administrative court must provide more justification of how the plant’s operations are inconsistent with the climate law.

In the meantime, Greenidge is permitted to continue to operate the power plant. In a statement Thursday, the company celebrated the ruling.

“The ruling ensures our facility will continue operating and our local employees will not have their careers ripped away,” read the statement.

Greenidge also alleged that the DEC’s initial denial was “politically motivated.” The company has been fighting with the DEC for years over its permit.

“The damage caused to our company and employees by the recklessness of the DEC and all those who lied about our operation is real,” the statement continued. “Today the Court set the record straight – we were right, and the state and its allies were wrong.”

A DEC spokesperson said that the decision confirmed the department’s authority to deny permits if an application does not meet the requirements of the climate law.

“As the matter was remanded back to DEC for further administrative proceedings, DEC cannot comment further on pending litigation,” the spokesperson said.

Environmental stakes

In his ruling, Dinolfo noted that the DEC can refuse to renew a permit based on climate impacts — but it must adequately justify its decision based on the climate law.

Environmental advocates say for that reason, the ruling underscores the power of the state’s climate law.

“The judge confirmed what we knew: that the New York State Department of Environmental Conservation has the authority to deny air permits — including renewal air permits — under the [climate law],” said Mandy DeRoche, an attorney with Earthjustice who is representing environmental groups involved in the case. “New York now can be confident that it can make decisions to protect our climate, the health and well-being of all New Yorkers.”

However, DeRoche noted that environmental groups are disappointed that Greenidge is allowed to continue to operate as the legal proceedings continue.

“It’s a big loophole,” said DeRoche. “You can get your air permit denied or modified, and then you can continue to operate and pollute like you were before, just because you have the deep pockets and the funds to continue litigating.”

The ruling requires an administrative court to now reconsider Greenidge’s permit renewal application and to provide justification for the claim that the plant’s operations would be inconsistent with the state climate law. Then, the case will likely return to the state Supreme Court.

That process is expected to take months — a timeline that concerns other local environmental advocates.

“For years, Greenidge has been polluting local air and spewing climate-warming greenhouse gasses into the atmosphere,” said Yvonne Taylor, vice president of Seneca Lake Guardian, one of the groups involved in the case. “It’s absurd that Greenidge is still operating, and we will keep fighting until the facility is shut down.”

The state had initially ordered Greenidge to shut down the power plant by Sept. 9.