July 18, 2018

Cannabis growers lead off-grid energy development

Its a little known fact that the Marijuana growers of Northern California were amongst the first to use solar panels to improve their crop yields, back in the mid 1970s.  Forty years later they are still at the forefront of energy innovation, and a burgeoning number of utility companies are working with cannabis cultivators to better manage costs by:

* Assigning employees to work exclusively with marijuana businesses.

* Recommending lighting, heating, ventilation and air-conditioning (HVAC) systems, which they say can save cultivators tens of thousands of dollars annually.

Here are some of the points growers are focusing on as they consider potential energy savings:

1. Electricity consumption typically is the second-largest cost incurred by indoor cultivation facilities.T

2. Find a Utility executive who is willing to focus on you  0 In May of 2017, I started devoting 100% of my time to the cannabis operations coming into our territory, knowing that all those companies were going to fill one portfolio of commercial account management,” said Matt McGregor, strategic account manager, cannabis operations, for the Sacramento Municipal Utility District (SMUD).McGregor estimates he has roughly 200 marijuana customers, mostly growers, but also about two dozen customers involved in extraction, infusion, processing and packaging.

3. Go to private utility companies, not government funded or municipal Utlities. Private utilities are investor-owned, for-profit corporations; public utilities are government-owned.Public utilities risk losing their licenses.Private utilities don’t have those constraints. Consider Puget Sound Energy (PSE) in Washington state, which has helped about 80 cannabis customers with about 100 energy-savings projects since 2014.  PSE buys the power it sells to customers off the market or from its own power generation.“So, we didn’t have to be concerned about losing federal funding by serving the cannabis sector,” said David Montgomery, an energy management engineer with PGE.

4.Find a private energy company that operates in your own State.  Xcel Energy – a private utility operator serving eight Western and Midwestern states including Colorado – goes by the same premise.“We work with marijuana companies because they are legal operating entities in the state of Colorado,” Xcel spokesman Mark Stutz said.”We are regulated at the state level, and to deny services would be in violation of state law.”

5. Remember what the Utility stands to gain –  Utility companies may have to build new power plants to supply customers’ demands, which is costly. It’s cheaper to persuade existing customers to reduce energy usage by using conservation practices and buying newer, more efficient lighting and HVAC.

Now, utilities are looking to the cannabis industry as a place where they can help customers take pressure off the grid.“With the legalization of the cannabis market in Massachusetts, and the fact that this business is extremely energy-intensive, this is an agricultural area where there is opportunity to proactively influence the design of these facilities in order to mitigate their very significant energy demand,” noted

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