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As Pot-Growing Expands, Electricity Demands Tax Grids


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http://www.detroitnews.com/story/business/2015/12/24/pot-growing-electricity/77890350/

 

As pot-growing expands, electricity demands tax grids
Jennifer Oldham, Bloomberg News 3:55 p.m. EST December 24, 2015
B99337797Z.1_20151224155521_000_G30NV465

(Photo: Elaine Thompson / AP)

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Pot’s not green.

The $3.5 billion U.S. cannabis market is emerging as one of the nation’s most power-hungry industries, with the 24-hour demands of thousands of indoor growing sites taxing aging electricity grids and unraveling hard-earned gains in energy conservation.

Without design standards or efficient equipment, the facilities in the 23 states where marijuana is legal are responsible for greenhouse-gas emissions almost equal to those of every car, home and business in New Hampshire. While reams of regulations cover everything from tracking individual plants to package labeling to advertising, they lack requirements to reduce energy waste.

Some operations have blown out transformers, resulting in fires. Others rely on pollution-belching diesel generators to avoid hooking into the grid. And demand could intensify in 2017 if advocates succeed in legalizing the drug for recreational use in several states, including California and Nevada. State regulators are grappling with how to address the growth, said Pennsylvania Public Utility Commissioner Pam Witmer.

“We are at the edge of this,” Witmer said. “We are looking all across the country for examples and best practices.”

The corporatization of what was once off-the-grid narco-agriculture is taxing electrical systems even as the nation prepares to comply with the Paris climate accord and the Environmental Protection Agency tries to reduce greenhouse gases from coal-fired power plants, which is considered the single largest domestic source of emissions that create global warming.

“Consumers seeking a green lifestyle are likely unaware that their cannabis use could cancel out their otherwise low-carbon footprint,” Evan Mills, a senior scientist for California’s Lawrence Berkeley National Laboratory, wrote in an email.

Indoor growing operations in 2012 racked up at least $6 billion a year in energy costs, compared with $1 billion for pharmaceutical companies, Mills found in a seminal study he did independent of the research institution. Some larger facilities today suck down as much as $1 million in power a month.

ArcView, a research firm, estimates the retail and wholesale marijuana market will reach $4.4 billion in 2016.

Cultivation operations from California beach cities to Denver’s warehouse district to District of Columbia closets are waiting months for new infrastructure to bring them power. Planners predict the escalating consumption could in some regions undo Americans’ attempts to save energy by buying more efficient refrigerators, washers and hair dryers.

With the industry just coming out of the shadows, utilities are without data to forecast its electrical needs.

“We don’t have aggregated energy audits from hundreds of grow operations that show us an energy footprint,” said John Morris, director of policy and regulatory affairs at CLEAResult, an Austin, Texas-based consultancy that works with growers and utilities. “We have utilities in the Northwest putting in new transformer substations to meet the load. Producers are having to go out and build infrastructure.”

In Colorado, more than 1,234 licensed grow facilities compose almost half of new demand for power. In 2014, two years after residents voted to legalize the drug for recreational use, growing sites consumed as much power as 35,000 households.

In California, indoor production consumed 9 percent of household electricity in the nation’s oldest legal medical pot market, the amount used in 1 million homes, Mills found. That study was published before the industry exploded after legalization in almost half the states and District of Columbia.

In a visit this month to a Denver warehouse, growers wore sunglasses as they checked on 150 top-heavy flowering plants. The four-foot-tall bushes were flourishing under dozens of 1,000-watt bulbs.

“All these things consume too much power,” said Paul Isenbergh, a commercial real estate broker and co-owner of the 3,100-square-foot medical-marijuana operation called Sense of Healing. He gestured at equipment surrounding varieties with names like Grape Crush. “The air conditioning, the lighting, the fans, the scrubber, the humidifier.”

The atmosphere is calibrated to mimic outdoor conditions to allow growers to reap multiple harvests a year. In an unvirtuous cycle, the intense heat from the lights requires air conditioning and fans to keep grow rooms at 75 degrees, a dehumidifier to prevent mold and a carbon-dioxide injection system. The electric bill for all this: as much as $5,000 a month.

Electricity represents as much as 50 percent of an operator’s overhead, yet profits far outweigh costs, with a pound of medical marijuana fetching about $2,500 on the wholesale market, Isenbergh said. His costs to raise the weed from clippings are only $600 a pound.

Some cities where growing operations are legal have seen power consumption soar as communities nearby made gains in meeting conservation goals. The disparity prompted several municipalities to tax growers who strain the grid.

In Boulder County, Colorado, commissioners levied an energy-usage fee on such facilities after discovering that a 5,000-square-foot operation consumed 29,000 kilowatt hours a month, about five times more than a typical commercial use.

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I mean, that would be like running 15,000-20,000 individual 1000 watt lights a month.

 

 It is so absurd I can hardly stand it.

 

 

82951.jpg

“If you can't dazzle them with brilliance, baffle them with moo poo.”

― W.C. Fields

 

:crazysmile:

 

 

EDIT: The fornicating editor edited the word b-u-l-l-s-h-i-t !

Edited by knucklehead bob
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Too bad it doesn't just grow outdoors in the sun. Like tomatoes and stuff like that.

 

and then to that they'll test and say that the microbial levels are too high, meanwhile the mega indoor guys will have the latest pest spray that doesn't show up in tests.

 

People are getting really illogical about something straighforward. Push us indoors and complain....sounds like business as usual

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I agree with "the sky is falling" angle. However, if you are concerned about the environment and climate change, here is one way to put-your-money-where-your-mouth-is: go to www.arcadiapower.com and sign up for their service - 100% wind power- to provide offsets to the energy you use from your local provider. The up charge is $0.015 (1.5¢) per kilowatt hour (kWh) over what you currently pay.

 

In my case, I use on average about 800kWh per month. That costs me an additional $12/month. Not only does it help the environment, it sends a message to your provider that maybe their customers want more environmental friendly energy.

 

Most of the big energy companies are included: DTE, Consumers, etc. in my case our local utility is not, so I'm giving them permission to "see" my usage (from the utility directly) and they bill me separately.

 

If you are interested, look at my signature for a $30 credit code when you sign up.

 

(Edited to correct the up charge.)

Edited by medmanmike
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I'm really not sure what people are disputing. Is the only argument in contention was that there just CAN'T BE growers using $1 million / month in electricity?

 

I mean, that would be like running 15,000-20,000 individual 1000 watt lights a month.

 

 It is so absurd I can hardly stand it.

 

Now multiply by 3: You are conveniently ignoring A/C, ventilation, and other associated energy costs.  According to this article in Forbes, lighting makes up the largest share on energy at an estimated 38%. Venting and dehumidification uses about 30% of the load , followed by air conditioning at 21% (largely to handle waste heat from lighting).  Space heating, water movement, carbon dioxide injection and drying account for the remaining 11%.

 

River Rock spends $21,500/month on electricity and knows of another company that spends about $100,000/month. Now I really don't know if the $1 million dollar number is an exaggeration, but I also haven't a clue what a 350,000 sq ft indoor facility (the largest one in the USA) - spends.

 

Estimates of 1% of all energy usage in the USA going towards marijuana growing is commonly cited. 3% of California energy (back in 2012!). 10% of all Denver electricity.  If you want to read an in-depth report on the cannabis energy output, check out the source for much of the original article's claims.

 

Hell, we haven't even TOUCHED upon H20 usage in places like drought-stricken California.

 

You may quibble about the million dollar energy bill, but it just sounds to me like there's a LOT of denial here regarding the environmental impact of cannabis growing...

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Getting around to the practical side of the discussion; The Answer.

 

The answer is; tax credits for those who grow marijuana outdoors. 

 

Why not? 

 

And lower rates for those who grow off peak hours. 

 

More liberal inclusive pot laws would fix it too. Real legalization would fix it permanently. 

 

When you create dams in the supply chain you create all kinds of problems. 

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If they just allowed pt's and c.g's to grow enough in the summer to satisfy their needs to make sure pt's had enough meds to not run out, it would take care of the problem.

 

I would love to grow enough out doors to harvest and get me through to the next harvest!

 

Oh what a wonderful world it would be!

 

Peace

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If they just allowed pt's and c.g's to grow enough in the summer to satisfy their needs to make sure pt's had enough meds to not run out, it would take care of the problem.

 

I would love to grow enough out doors to harvest and get me through to the next harvest!

 

Oh what a wonderful world it would be!

 

Peace

 

And THAT'S the ticket! Why is there so much indoor growing in CA and CO?? OK, you have much more control over lighting and thus flowering. But energy usage would plummet if outdoor growing were encouraged.

 

The increased usage (and continual improvement) of LEDs is another factor that make energy projections problematic.

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Interesting. Consider a million in electricity using a typical twelve plant mmj grow.

 

Twelve plants. Six by ten grow space, 60 sq ft.

 

Total usage 500w in veg, 2kw in flower. 36kw-h/day.

 

$.10/kw-hr. $3.60/day for twelve or $.30/plant. 5 sq-ft/plant. $.06 sq-ft/day.

 

So how much is a million a month in elec usage equate to in sq ft? 500,000 sq-ft.

 

100,000 plants.

 

Four month plants producing four ounces per plant would be 100,000 ounces a month. $10,000,000/month revenue at $100/oz.

 

Five-hundred-thousand square feet is about twelve acres.

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There is an elementary mistake in the original article that makes its accuracy suspect, namely the author's estimate of the mj market. The $3.5 billion gross revenue number is way too low. Something like one-tenth the actual WHOLESALE value.

 

One thing journalists and politicians have in common is they can't count.

 

Simply look at the actual CO tax revenues and the article's market estimate error is obvious.

 

This whole exercise makes one thing apparent. The small basement personal use grow will be a fixture of the supply chain for years.

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There is an elementary mistake in the original article that makes its accuracy suspect, namely the author's estimate of the mj market. The $3.5 billion gross revenue number is way too low. Something like one-tenth the actual WHOLESALE value.

 

One thing journalists and politicians have in common is they can't count.

 

Simply look at the actual CO tax revenues and the article's market estimate error is obvious.

 

This whole exercise makes one thing apparent. The small basement personal use grow will be a fixture of the supply chain for years.

That is apparent to everyone including the huge grows and law enforcement. That's why a portion of the proceeds from the quazi legal laws goes to shutting them down and putting the growers in prison whenever possible. We get a politician or two telling us this now and then. A little bit of truth slips out. 

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Hi Resto,

 

I would suggest you might reconsider any conclusion LEO and politicians know about the cannabis market. I think they are clueless and blinded by 85-years of their own paranoia and propaganda. Prohibition was bred from their ignorance.

 

For instance, we all know cannabis is a plant like tomatoes. To label it a drug it in the same category as heroin, cocaine or opioids is false and misleading.

 

The drug label gives rise to the second error Prohibitionists make; failing to recognize that cannabis is a market commodity and as such subject to the elementary laws of economics.

 

For a party like the GOP that supposedly supports a free-market economy, this error is particularly egregious.

 

That leads to my third point. The cost of the electrical power by mj producers is negligible in comparison to the tens-of-billions of dollars wasted each year on a failed prohibition of a plant.

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Outdoor Grows =. Minimal power consumption and carbon footprint

Superior Product

Maximum Yields

GREEN, Acts as CO2 scrubber and O2 generator.

Cheap @ $25 a plant yields an average 1/2 lb finished ( conservatively)

 

Indoor grows are inefficient , expensive and produce sub par meds.

 

The only reason indoors is written in the law is for prohibitionists to be able to write ordinances and restrictions more easily.

 

Free the Weed, The Answer is blowing in the Wind.....OUTDOORS

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I agree with "the sky is falling" angle. However, if you are concerned about the environment and climate change, here is one way to put-your-money-where-your-mouth-is: go to www.arcadiapower.com and sign up for their service - 100% wind power- to provide offsets to the energy you use from your local provider. The up charge is $0.015 (1.5¢) per kilowatt hour (kWh) over what you currently pay.

 

In my case, I use on average about 800kWh per month. That costs me an additional $12/month. Not only does it help the environment, it sends a message to your provider that maybe their customers want more environmental friendly energy.

 

Most of the big energy companies are included: DTE, Consumers, etc. in my case our local utility is not, so I'm giving them permission to "see" my usage (from the utility directly) and they bill me separately.

 

If you are interested, look at my signature for a $30 credit code when you sign up.

 

(Edited to correct the up charge.)

It was not so great for me, hell infact it was higher for me, I used there calculator that shows what savings you should get ,, lol mine went up.. see 

Dirty Energy Bill
$
460
kWh
 
3266

 

$482

100% Clean Energy bill

I suppose for one light bulb.. and your grow was all florescent maybe. but for 3k in lights, plus a full electric home.. it seems to me you will pay more. even if its only 20.00 or so but it seems to add up...

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