5 energy trends and how to gameplan for success

Added on 21 March 2022

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5 energy trends and how to gameplan for success

Energy costs are up across the board, so make sure you're doing everything in your power to get the most from your energy provider.

Energy efficiency has been top of mind for indoor agriculture for decades, but as more states legalize cannabis, technology matures, and supply chain disruptions shine a light on food security and local economies, indoor grow operations are expanding throughout the US.

However, in 2022, operators of controlled environment agriculture (CEA) facilities should expect greater scrutiny and attention surrounding their facility's resource use. Business owners should be prepared to not only justify water and electricity use, but also associated carbon emissions and, above all importance, improvement plans.

Understanding and getting ahead of the following trends and practices will help large scale operations stay on top of business impacts, resource use and social demands.

Resource Benchmarking and ESG Reporting: Increased resource benchmarking will become core to compliance and a strategic business advantage. Expect to see increased data requirements from regulators and resource suppliers. For example, water districts may impose stricter requirements for wastewater quantity and quality. Utilities and regulators may demand to know how much electricity a facility will use annually and during grid peak demand, and its total carbon implications of a facility and its supply chain.

While specific ESG reporting requirements may vary, companies generally are expected to provide information that is material to their business, consistent, accurate and complete. Adopting and integrating industry-standard KPIs into your operational planning sets you up for success.

TIP 1: Ensure that you can articulate your facility's annual electricity kWh, peak demand, therms of gas, gallons of water used, gallons of water reused, gallons of wastewater and sources of electricity with associated carbon intensity.

Contextualizing Resource Inputs: Be prepared to articulate the value your business is providing in the context of resource use and other industries. For example, an outdoor vegetable producer can only provide short-term transient jobs, while an indoor operation provides jobs year-round. In addition, indoor facilities can reduce miles traveled from the cultivation site to the consumer, with resource savings from transportation, water use and low spoilage.

TIP 2: give context to the resources it takes to create a unit of your product especially compared to other consumables or facilities. Can you correlate and justify each of the previously mentioned resources with facility (square feet), production (output of final product) and economic (direct revenue, total economic) values? How does your water consumption per serving compare to, for example, beef or pharmaceuticals? How much GDP does your industry and facility use compared to other manufacturing industries such as glass manufacturing or steel smelting?

Attention to Facility and Grid Flexibility: 2022 will see an increased focus on when electricity is used throughout the day and throughout the year, along with a demand for more flexibility. Most consumers are charged a flat price per kWh.