The worst-kept secret in the cannabis industry is that multiple forces are pushing cultivators to the brink of insolvency. However, there is one area where growers have some control over their destiny: the equipment selected and how they use it.
For most indoor growers, energy represents up to half of their total operating costs. The good news is that an operator’s energy bill is largely in their control. One of the most important factors is how efficiently the operator uses energy inputs to produce the plants that are the cornerstone of the business.
Further, many of these emerging energy-efficient technologies are eligible for lucrative incentives from energy utilities across the country.
Lighting
Upgrading grow lights can slash energy bills by up to 50%.
In an industry largely based on growing light-loving crops indoors, there will always be a need to use electricity to power artificial lighting. However, advances in LED technology and lessons learned from growers worldwide are giving cultivators more opportunities than ever to throw out old assumptions about how much energy they need to pump through their grow lights to produce amazing cannabis.
Since the unfortunate early years of LED grow lights, when they rightly earned an awful reputation, horticultural lighting companies around the globe have poured millions of dollars into research and development. As a result, today’s LED fixtures allow for precision control over light spectrums that enable growers to “steer” the plant’s expressions, while emitting more light per unit of electricity than traditional high-intensity discharge fixtures. Modern LEDs also run cooler, which means that HVAC systems don’t have to work so hard.
Choosing to install LED fixtures instead of HIDs can reduce energy consumption in a cultivation facility by up to half thanks to the combined effects of reduced load at the plug level and on the HVAC system. As a result, electric utilities throw money at cultivators who install them, because they reduce the amount of power the utility needs to generate or purchase in order to meet that demand. These utility incentives can often cut the upfront costs of LEDs by 30% to 50%. In some municipalities, the upfront cost reduction has been as high as 95%.
Heating and Cooling
Technology to cool and dehumidify a sealed indoor environment is one of the most poorly understood aspects of a commercial cannabis cultivation facility, not to mention one of the most expensive to purchase and install. Getting the HVAC and dehumidification component wrong can easily create conditions for a pest or powdery mildew infestation, potentially risking the need to destroy or distill the entire crop, a mistake that can cost hundreds of thousands of dollars of lost revenue.
As a result of the fear of crop infestation, operators may oversize their equipment to prevent unexpected hot and humid spells. Unfortunately, improperly sized systems may still yield unfavorable growing conditions and will invariably waste loads of electricity in the process.
The good news is that, much like in the lighting market, many HVACD companies are continually improving their technology, delivering systems that are more controllable and predictable and less energy-intensive to operate. The practical result is better equipment that can keep grow rooms’ environmental conditions rooms pegged to setpoints with unmatched precision at a lower operating cost.
This financial result of using a more precise and energy-efficient system means that a grower can expect to reduce their HVACD-related operating costs by 30% or more. Similar to lighting, utilities pay operators handsomely for these savings, and cultivators can frequently see incentive checks accounting for well over half of the equipment’s upfront cost.
Data Analysis
Every second of every day that a grow room is in operation is an opportunity for the operator to capture deeply meaningful and profound insights about that facility, such as how optimally it uses room square footage, table and bench space, energy, water or nutrient inputs and other factors to produce valuable crops.
Most grow operators use sensors and alarms to track key parameters of a grow room’s operation, such as temperature and humidity and runtime for lights and HVAC equipment. Watching these data points is critical to reducing the risk of failure, but many cultivators miss this opportunity to capture the larger stories data tells them that can result in massive energy and cost savings.
Thankfully, data analytics companies continue to find innovative and powerful ways to analyze, present and integrate data-driven insights into cannabis cultivation operations. For example, companies such as Canold are able to incorporate data captured across the company, such as sales, strain-specific productivity and energy intensity. These insights can let operators understand on a much deeper level how their decisions in the grow room affect profitability, including what strains may be costing them more in energy and other inputs than they are worth. Growers should also benchmark their energy performance by completing a Cannabis Power Score, available at no cost from the Resource Innovation Institute. Taking the simple act of entering data about yield, energy and water usage and waste footprint will yield valuable information about the farm’s relative efficiency.
One beautiful aspect of data analysis and integration is that for the most part, no additional equipment is required.
Adopting the Playbook
Whether a cultivation facility uses energy efficiently or not could very well mean the difference between a thriving business and one whose management struggles to pay its bills. Advances in lighting and HVAC technology are giving cultivators important tools to dramatically reduce their energy consumption, and advances in data analysis and integration are allowing them to better understand the energy use implications of the choices made across the company.
But the key to a cultivator’s business success is fundamentally how well they adopt these technologies and best practices and make the most of them. Thankfully, the playbook is written; now, for cultivators to survive, they need to follow it.
Sam Milton is the owner and founder of Climate Resources Group, a company that provides energy and sustainability services to the cannabis industry through its Enlighten Your Grow program.