The Cambridge Centre for Alternative Finance (CCAF) has confirmed that Ethereum reduced its energy consumption by 99.98% after The Merge. However, the study suggests that network infrastructure concentration, rather than environmental impact, has become the main concern for institutions evaluating Ethereum.
Published in June 2026, CCAF’s report Ethereum After the Merge – A Change in Power examined the impact of Ethereum’s transition to proof-of-stake and found that annual energy demand dropped from 2.4 gigawatts before The Merge to 7.87 gigawatt-hours per year afterward, equal to roughly 0.90 megawatts of continuous usage.
The report also showed a dramatic reduction in emissions, with Ethereum’s carbon footprint declining from 10.3 million tonnes of CO₂ equivalent to approximately 2.37 thousand tonnes—a 99.98% decrease achieved through a single protocol upgrade.
The findings highlight the scale of Ethereum’s transformation. The September 2022 shift from proof-of-work to proof-of-stake eliminated energy-intensive mining and became one of the largest efficiency improvements recorded among major public blockchain networks. The change has also strengthened Ethereum’s standing within ESG evaluations used by institutional investors.
CCAF Report Highlights Ethereum’s Post-Merge Impact
CCAF based its analysis on a network-weighted average energy estimate of 105 watts per node, using observed network conditions rather than theoretical calculations.
The report compared Ethereum’s energy consumption before and after The Merge with several real-world examples. Prior to the upgrade, Ethereum’s electricity usage was similar to the energy demand of Iceland. After the transition, the network’s annual footprint became comparable to the electricity consumption of the Eiffel Tower.
When compared with the traditional financial system, Ethereum’s energy use is significantly smaller. CCAF estimates that banking infrastructure—including branches, ATMs, and data centers—consumes around 260 terawatt-hours annually. Ethereum’s post-Merge consumption of 7.87 gigawatt-hours is roughly 33,000 times lower.
Ethereum’s carbon emissions also declined dramatically, falling to only 2.37 kilotonnes of CO₂ equivalent after the upgrade.
In a comparison with other blockchain networks, Ethereum’s current energy use remains below Solana, which consumes more than 13.4 GWh annually, but above NEAR Protocol, which uses about 5.11 GWh per year. CCAF noted that Ethereum remains a relatively efficient network when measured against its economic activity and overall value secured.
Focus Shifts From Energy Use to Decentralization
Following the CCAF findings, Ethereum’s environmental impact is no longer the primary concern for institutional investors. The bigger question now is whether the infrastructure supporting the network is sufficiently decentralized and secure.
The report points to potential risks involving node distribution, including geographic concentration and dependence on a small number of cloud service providers. While Ethereum has solved its energy challenges, these infrastructure dependencies create a different set of operational risks.
Validator locations, hosting choices, and network participation patterns are likely to receive greater scrutiny from institutions assessing Ethereum’s long-term stability.
The CCAF report could help Ethereum overcome ESG concerns among investors who previously viewed proof-of-work networks as environmentally problematic. However, institutions may still require further analysis of decentralization, infrastructure resilience, and ecosystem sustainability before fully clearing Ethereum through their risk frameworks.
