Nick Collins, ERS, written for AESP Strategies
The state-level legalization of medicinal and adult-use cannabis has exploded over the past decade, creating a multi-billion dollar industry. While there are very large outdoor farms in several areas of the United States – like Pueblo County, CO; the “Emerald Triangle” of Humboldt, Mendocino; and Trinity Counties, CA – a substantial quantity of legal cannabis is grown in indoor or greenhouse facilities, especially where local climates do not favor outdoor cultivation. The indoor cultivation facilities are particularly energy intensive due to the incredibly high lighting power densities of the flower and vegetation rooms and the need to cool and dehumidify the cultivation rooms. The Cannabis Energy Report: The Current and Evolving State of Cannabis Energy Consumption (New Frontier Data, 2018) estimates that the legal cannabis industry consumes 1.1 million MWh of electricity annually with an anticipated growth of electrical consumption of 162% between 2017 and 2022.
As the industry has grown, so has the number of cultivators. In several more mature markets, this has led to supply nearly outpacing demand with commensurate reductions in product value. In 2018, Oregon experienced a price collapse due to oversupply, with the value of cannabis dropping 50%. This pattern is set to continue as new markets come online, and the lessons of more mature markets are not applied.
The energy efficiency community has a unique opportunity to influence an emerging, highly energy-intensive industry that is still in its nascent stage and is poised for continuous growth in the near future. But how do we get there? What are the challenges faced by cultivators and energy efficiency professionals? What opportunities exist for reducing energy consumption? And how does the EE community engage with these elusive facilities?
There are numerous challenges faced by cultivators and EE professionals when it comes to designing and operating more efficient facilities:
- There is a race to the market. When a new market comes online, whether medicinal market or adult use, cultivators race to be the first on the block, trying to build out and begin producing a product as quickly as possible. This precludes thoughtful design and drives the cultivator toward readily available commercial HVAC equipment, which is ill-suited to indoor cultivation environments. This typically results in facilities that consume much more energy than necessary (best case scenario) or facilities that are unable to maintain the desired environmental parameters, resulting in lost crops due to biological contamination, more equipment added to “fix” the problem, and even higher energy use (worst case and, unfortunately, a very typical scenario).
- There is a lack of access to capital. Cannabis cultivators do not have access to traditional capital sources. They cannot go to the bank to get a loan. Therefore, they rely on investors who do not see the value in spending the time or money on energy efficient design or operation. Additionally, more efficient systems are more expensive. There is a very real hurdle associated with the incremental cost associated with more efficient systems. LED horticultural lights designed to replace the standard-bearer 1,000-watt high-pressure sodium fixtures that dominate the market cost three times as much per fixture.
- Cultivation techniques are ruled by “tribal knowledge.” There are no ASHRAE standards or widely accepted best practices. Cultivators learn from the cultivators that came before them. The science and engineering rigor that has been applied to other industries is only just now starting to be applied to this industry. Cultivators are reluctant to allow “outsiders” into their facilities or processes.
There are significant opportunities to reduce energy consumption associated with indoor cannabis cultivation. Our work in this sector has demonstrated that energy savings on the order of 40% are readily achievable through thoughtful design and the application of the correct equipment.
Lighting – While we may point to lighting as a prime
opportunity, it is, in fact, one of the most difficult to implement due to the
entrenched belief in the productivity of high-pressure sodium (HPS) fixtures.
The majority of growers are not willing to abandon their prime instrument (HPS
lights) and gamble with technology that they do not have experience with (LED
HVAC and Dehumidification – HVAC, and particularly dehumidification, presents an opportunity for savings on par with the savings possible with LED fixtures. We consistently see indoor facilities served by HVAC units that are in no way intended for the loads experienced in these facilities. There are numerous options available that can produce substantial savings over the light commercial equipment paired with standalone dehumidification units that are so often encountered. HVAC systems are also absolutely critical in maintaining the desired grow environment and, when functioning properly, can greatly enhance the productivity of a facility. When functioning poorly, they create ongoing facility issues and crop loss.
The Path Forward
Indoor cannabis cultivation is a highly specialized and unique industrial process, but it is a process that can be understood, one whose loads can be accurately quantified and whose systems can be optimized for efficiency and productivity. So why isn’t this happening? The challenges listed above play a role, but the lack of engagement between the cultivation and EE communities restricts optimization. In child development, there is a term called “parallel play” when toddlers play next to each other, aware of what the other is doing but otherwise play by themselves. The cannabis and EE industries are engaging in parallel play. To advance this industry, in terms of both energy efficiency and productivity, it is critical that these two groups come together to share ideas, experiences, data, and best practices.
Join Nick Collins on June 6 for a more detailed examination of the state of energy use in the cannabis industry, with presentations by Nick and two leader cultivators. The webinar is free for AESP members.