On January 20, Joe Biden will take the most powerful office in the world. The White House certainly doesn’t have the ability to unilaterally change energy and cannabis policy, but experts are trying hard to peer into the future to see what the President-elect has in mind.
To put it simply, a Biden administration won’t revolutionize the cannabis or energy industries, but it’s important that its policymakers understand just how closely connected those two fields truly are. The future of energy and cannabis production is much more intertwined than many governments at the local, state, and federal level understands, but what we’re finding is the market has already made that leap.
Biden has promised to transition from fossil fuels to renewable energy, but he’s keeping his hands off the regulations that would actually affect production. The real meat behind Biden’s energy policy will focus on putting the costs of fossil fuels and their pollution squarely on those who produce and consume; in effect, he’s looking to take the harmful externalities of fossil fuels and keep those costs on the books of companies burning them.
The market is already headed in that direction, with many corporations making huge investments and even bigger promises to go carbon neutral. Companies like Facebook, Google, Microsoft, Amazon, and others have paraded their ambitious energy goals as cornerstone marketing content, many of them well-ahead of local or national efforts. Biden has promised new investment to make wind, solar, and other renewables less expensive, but those technologies are cheaper each and every day without much help from the federal government. The real benefit of investment will be to make the technology more accessible to more medium and small facilities that may not otherwise meet subsidies or grant programs.
It’s not too far of a leap, then, to see how this type of investment should be a boost to cannabis production. With the SAFE Banking Act still sitting on the GOP’s desk in the Senate, they’ll need that legislation and other bills to open up more access to publicly-funded energy grants and loans that they may not be eligible for today. With that help, expect marginal costs to shrink and production potential to rise.
More supply is needed, too. Four more states (Montana, New Jersey, Arizona, and New Jersey) voted to allow legal marijuana for recreational use. These states will put implicit pressure on their neighbors, including New York, to enact similar legislation and get the number of states with legal recreational use over the forty mark by the end of the decade.
It does appear to be a longshot that Biden would prioritize pushing a federal effort to legalize marijuana, especially anticipating fierce and likely insurmountable resistance in the Senate. However, it’s likely a Biden-appointed attorney general wouldn’t have cannabis legislation high on his or her to-do list, and harsh enforcement would be much more remote a prospect as compared to that of Jeff Sessions and Bill Barr, Trump’s attorneys general.
While certainly falling short of anything like a revolution, we can expect a Biden administration to nudge along two dove-trailing industries a bit more spiritedly down a road both are already traveling. Free markets, lubricated by new government investment, will improve sustainable and renewable technology and reduce cost, making industries that need it most, like cannabis, some of the first to take advantage.
What do you expect to see over the next four years? Let us know!