As the national rolls into a new year, recreational marijuana legislation across the country has gone into effect. Thousands of people lined up for hours, even days, to be the first to purchase legal marijuana in Illinois. It was a similar story in Michigan, who saw legal weed sales take off in late 2019. Demand for safe, regulated, and legal pot is reflected in the prevalence of new laws legalizing the drug and the tens of thousands of people eager to buy.
But there’s more to that demand than just sales. Marijuana is an extremely energy-intensive crop, and as growers have multiplied and stepped up production, their energy footprint has grown, too. In 2018 alone, a recent study found that legal growers used up 1.1 million megawatt hours, the same amount of energy used by over 92,000 homes.
That’s just the start. With another half dozen states legalizing marijuana in 2020 and more states expecting to follow suit after elections this November, more and more growers will pop up across the country. With demand high and revenue flowing, current producers will increase their output as well. From 2017 to 2022, the electrical demand of legal marijuana growers is forecasted to increase by 162%.
Going forward, outdoor growers may have some advantages, provided they have a cooperative climate. Indoor growers use up nearly 18 times more electricity than outdoor per gram of weed grown. They also emit over 25 times the amount of carbon emissions. That’s because indoor growers rely heavily on artificial light, heaters, fans, and climate control systems to control humidity.
In Michigan, there’s already an interest in regulating just how much energy a grower can use. For now, the state doesn’t even mandate reporting of energy consumption by growers. There are no Michigan laws to monitor or track energy use, a measure that Illinois did include when it legalized marijuana.
There’s a drawback to that lack of oversight, too. It’s the perfect opportunity to offer incentives and tax breaks to growers who do invest in efficient and responsible practices. By encouraging metered energy use, both private and public entities have the opportunity to invest in the most efficient firms who, as a result, will be the most competitive and successful in the long-term.
And that might be incentive enough. As more growers enter the market, the industry is going to get more and more competitive, and energy efficiency is going to offer the best way to reduce costs and maintain the current retail margin. We’re already working on reducing energy use, carbon emissions, and improving crop yields for both indoor and outdoor growing facilities in the Midwest. Tomorrow’s winners will be firms that invested in efficiency early; be one of the smart ones.