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Like other large-scale crypto-mining operations, Greenidge relies on thousands of electricity-guzzling computer servers that generate bitcoin by solving complex equations. To power those servers, Greenidge uses a former coal-burning plant that was converted to natural gas in 2017 after years of disuse.

In 2022, the New York Department of Environmental Conservation a required air permit to the plant on the grounds that its greenhouse gas emissions ran afoul of the state’s ambitious climate goals.

In response to a lawsuit by the corporation, State Supreme Court Justice Vincent M. Dinolfo ruled Thursday that the agency had failed to give Greenidge an opportunity to justify its continued operation, an “interpretative error” under the law.

“Transparent political bias lost today,” Greenidge said in a prepared statement. “The ruling ensures our facility will continue operating and our local employees will not have their careers ripped away by politically motivated governmental overreach that had no basis in law from the first day it began.”

A coalition of environmental groups, meanwhile, allege Greenidge is pumping millions of pounds of carbon dioxide into the air, while contaminating the nearby Seneca Lake with daily discharges of heated water required to run the plant.

“The Finger Lakes community has been sounding the alarm on the disastrous impacts of this facility on their water, air, and climate,” said Mandy DeRoche, a deputy managing attorney in the Clean Energy Program at Earthjustice. “We will continue our fight until Greenidge shuts down for good,”

In rejecting the permit, the DEC said the plant had misled regulators about the true purpose of the conversion. “Instead of helping to meet the current electricity needs of the state as originally described, the facility is operating primarily to meet its own significant new energy load,” the agency said in its letter to the company.

A spokesperson for the DEC did not respond to a request for comment about the decision.

Greenidge has said it is in compliance with its permits and that the plant is 100% carbon neutral, thanks to the purchase of carbon offsets such as forestry programs and projects that capture methane from landfills.

Yvonne Taylor, a vice president at Seneca Lake Guardian, said the facility was a test case for the state’s ability to enforce a raft of climate laws. She worried the recent election of Donald Trump, who received billions of dollars from the crypto industry, would further weaken efforts to enforce those protections.

“Greenidge being permitted to continue operating flies in the face of our state climate goals and what we’ve spent generations working for in our community,” Taylor said. “It’s not serving any public purpose or benefit other than making a few people who are already rich, richer.”