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Cannabis Taxes the U.S. Electrical Grids

Written by Heather Ritchie

While the legalization of Cannabis brought great medicinal and therapeutic benefits to many Americans, it also came with high unanticipated environmental costs. Recreating the sun for indoor grow operations is extremely expensive. Much of Colorado’s production occurs in large warehouses and, for example, a 10,000-square-foot-facility could pay $10,000 a month for electricity.

Denver’s Department of Public Health and Environment calculates that the cannabis industry accounted for approximately 3.9 percent of the city’s total energy use in 2016. That’s almost double the 2014 statistics. Utility companies now worry about the effect the increased energy usage has on the power grid.

Understanding the Problem

The cannabis market doesn’t need to have a negative reputation for using excessive energy. Places like Boulder County in Colorado help cannabis businesses help themselves. They’ve initiated a program, the Marijuana Energy Impact Offset Fund, that, while voluntary, businesses can join for about two cents per kilowatt-hour. That money goes towards analysis for understanding how the industry uses energy and then teaches ways to do it more efficiently.

The Resource Innovation Institute created the Cannabis PowerScore website that allows growers to input their operational data and obtain reports on what isn’t working, what is, and how their business compares to other operations. Information sharing, and collaboration foster a better understanding of the industry’s energy use, so the market can progress to a more advanced level of commerce and production.

There is a need for more plants grown by the sun, but there are problems here as well. Many states have medical cannabis regulations that require that cannabis cultivated for dispensaries must be grown indoors. Places like Hawaii and California that have great weather and soil for growing plants are forced to raise their crops indoors. Illegal grow operations of the past also contributed to the industry of innovative accoutrements and products for growing cannabis inside, like lights and soil amendments.

There needs to be a solution to using natural sunlight for growing cannabis like most other crops that are grown outdoors, specifically for sunlight’s attributes. Using natural sunlight would reduce energy concerns significantly.  For now, perhaps solar panel manufacturers and providers can begin working closely with grow houses to help them generate possibly even more power than they need, especially in sunny places like Arizona, Nevada, Colorado, California, and Hawaii.  The cannabis industry could be an untapped market for companies producing solar-based solutions, or other innovative prospects for curtailing increased taxation of the fossil-fuel based energy grid.



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Heather Ritchie

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