Definition
Heat rate is the standard measure of how efficiently a thermal power plant converts fuel into electricity. It expresses the amount of fuel energy, in British thermal units (Btu), needed to generate one kilowatt-hour or megawatt-hour of electrical output. The lower the heat rate, the less fuel a plant burns per unit of power, and the cheaper each kilowatt-hour becomes for an on-site miner.
Heat rate and efficiency
Heat rate is the inverse of thermal efficiency. Because one kilowatt-hour contains exactly 3,412 Btu of energy, a theoretically perfect 100%-efficient plant would have a heat rate of 3,412 Btu/kWh. Real plants fall short: a modern combined-cycle gas turbine running near 60% efficiency posts a heat rate around 5,700-6,960 Btu/kWh, while a simple-cycle open-cycle turbine at 35-40% efficiency burns far more fuel per kilowatt-hour.
Why miners track it
For a miner generating power on site, heat rate is the bridge between fuel price and electricity cost. Multiply the heat rate by the delivered gas price (per Btu) and you get the fuel component of your cost per kilowatt-hour, which feeds directly into cost per terahash and break-even analysis. A plant that looks cheap on capital can quietly erode margins if its heat rate is high.
Heat rate also worsens at partial load, so a unit run well below its rating burns more fuel per kilowatt-hour than its nameplate figure suggests. Pair this metric with the plant's turndown ratio and its baseload-versus-peaking profile to model real-world fuel spend.
In Simple Terms
Heat rate is the standard measure of how efficiently a thermal power plant converts fuel into electricity. It expresses the amount of fuel energy, in…