Efficiency experts say the biggest opportunities to reduce energy use in the cannabis sector are in the design phase of a new grow operation.

s marijuana becomes more mainstream, an increasing number of utilities are seeing growers set up shop in their service territories — at times creating distribution system issues, and in general bringing significant new demand.

With federal legalization now a topic du jour, there is a growing focus on energy efficiency in the cannabis space and how utilities and industry groups can help growers control their demand. Total electricity demand from legal marijuana cultivation in the United States is estimated to rise 162% from 2017 to 2022, according to Research from New Frontier Data, which focuses on analysis of the cannabis industry.

Credit: New Frontier Data

Compared with a typical office building, indoor marijuana growers are about 10 times as energy intensive on a square footage basis, according to Neil Kolwey, industrial program director for the Southwest Energy Efficiency Project (SWEEP).

SWEEP recently hosted a webinar to discuss energy efficiency in the cannabis industry, and Kolwey said it is important to keep the sector’s energy use in perspective — it is not particularly large in aggregate, but can have significant impacts in specific areas.

Data centers use two to three times the energy of marijuana growers, again on a square-footage basis, he said, and account for about 1.8% of the United States’ electricity consumption. Pot growers, including illegal operations, account for just 0.1% right now.

But cultivation centers are energy intensive: a single one could overload a utility transformer, while an industry can add substantially to a city’s power demand.

Utility headaches

Growers account for 4% of Denver’s electricity consumption. In Xcel Energy’s territory, marijuana cultivation can account for close to 2% of demand and as the legal industry ramped up five years ago, it caused headaches for the utility.

“The issue wasn’t meeting the demand,” Xcel spokesman Mark Stutz told Utility Dive. But in some areas of its territory, “we often found the systems were not adequate for a 24 hour grow operation. … There were growing pains in the first couple of years after it became legal.”

There are now about 500 grow facilities in Xcel’s territory, using between 35,000 MWh and 45,000 MWh annually. “Certain pockets [in the city] became warehouse districts for marijuana growing,” said Stutz. Built years ago for different types of industry, transformers had to be replaced in order to deliver enough energy.

Energy consumption in Xcel’s Colorado territory from the cannabis industry has since leveled off, Stutz said

Credit: Xcel Energy

Nationwide, however, the trend remains upward.

“We’re seeing that electricity consumption increases are just continuing as this market continues to escalate,” said Derek Smith, executive director at Research Innovation Institute (RII), a non-profit market-transformation group in the cannabis space. “That’s the trend we’re on unless we do something about it.”

There are now more than 30 states with medical marijuana programs, and nine plus the District of Columbia have legal recreational access. Growing interest in cannabis means higher energy demand. But with the product now legal, markets are responding to typical economic forces — meaning energy efficiency may become vital to turning a profit.