Power grids getting high on pot: States roll out laws to make cannabis industry more energy efficient



As marijuana legalization spreads to more states, one of biggest unanticipated impacts is on the power grid.

"In Denver, marijuana production predominately happens inside of warehouses," explained Colorado Harvest Company CEO Tim Cullen. "We have to recreate the sun in order to get marijuana plants to flower indoors."

Recreating the sun is extremely expensive, Cullen said while standing in one of his company's two grow houses. "This is a 10,000-square-foot facility and our electrical bill is about $10,000 a month."

Denver's Department of Public Health and Environment estimates that the marijuana industry accounted for 3.9 percent of the city's energy usage in 2016. That's about double the amount the industry used in 2014, when the country's first legal recreational pot sales first started in Colorado.

Denver's Department of Public Health and Environment estimates that the marijuana industry accounted for 3.9 percent of the city's energy usage in 2016. That's about double the amount the industry used in 2014, when the country's first legal recreational pot sales first started in Colorado.

Denver's Department of Public Health and Environment estimates that the marijuana industry accounted for 3.9 percent of the city's energy usage in 2016. That's about double the amount the industry used in 2014, when the country's first legal recreational pot sales first started in Colorado. (Reuters)

Thirty states have some form of legal medical marijuana and eight of those and the District of Columbia have legalized recreational pot. Recreational sales haven't started yet in every state where it's legal but as they do, and as other states consider legalization, the industry's power consumption will grow.

"The utility companies are concerned," according to Ron Flax, chief building official for Boulder County, Colo. "And this is something that we've been seeing around the country – concern about the increase in the load in the grid. Do they have the infrastructure to handle it?"

Boulder County has started a program to help pot producers help themselves, as well as the county, by cutting electricity costs. Under the voluntary Marijuana Energy Impact Offset Fund, the county charges a little over 2 cents per kilowatt hour used by growers.

"That money for the most part is going into helping us understand how the industry is using the energy and then teaching ways to maybe do it more efficiently."

"The reality is this industry has been in the shadows for a long time," said Derek Smith, executive director of the non-profit Resource Innovation Institute.

He said many newly legal operations are, "...using, in some cases, the same technology that was used in basements in the black market days just blown up to 50,000 square feet – very hot lights, very inefficient HVAC, very little ventilation."

Another problem is a lack of detailed analysis on precisely how energy is used in individual facilities. To help companies get a handle on that, the Resource Innovation Institute launched the Cannabis PowerScore website where growers input their operational data privately, and get detailed reports on what is working, what's not, and how they compare to other operations.

"This industry doesn't need to have a bad reputation for using a lot of energy. It needs to come together and collaborate, share data, share best practices,” Smith said, “and move to a more sophisticated level of production and commerce."

"In Denver, marijuana production predominately happens inside of warehouses," explained Colorado Harvest Company CEO Tim Cullen. "We have to recreate the sun in order to get marijuana plants to flower indoors."

"In Denver, marijuana production predominately happens inside of warehouses," explained Colorado Harvest Company CEO Tim Cullen. "We have to recreate the sun in order to get marijuana plants to flower indoors." (REUTERS)

Massachusetts, where voters approved legal recreational weed last election, isn't waiting for the industry to get its act together. The state is planning to simply put a blanket limit on grow facilities of 36 watts per square foot of cultivation space.

Smith believes other states will follow suit.

"Oregon and California have made some legislative efforts to regulate energy and I think that's going to be an ongoing evolution in the industry," he said.

That is incentive for the industry to rein in its energy consumption, but Cullen said so is the bottom line.

"There are a lot of fixed costs in marijuana production,” Cullen said. “Electrical use is one place that we can be smarter about it and...find a competitive advantage."