Why Cannabis Rebates?

Growers can receive financial assistance to purchase efficient lighting. However, many remain puzzled at why exactly their electric utility is writing them a check. As one recently licensed grower stated, “I’ve been hiding from my utility for decades. Why should they give me money now?!” Below is my effort to explain the logic.

Current electric infrastructure cannot meet future demands.

Resources are Finite
Specifically, electricity is. Yet our appetite for electric consumption keeps growing. Electric infrastructure such as power plants, lines and substations has a set capacity. At current growth, the infrastructure of today is not capable of serving human needs in the future. Too much demand crowds the power grid. A crowded grid means frequent blackouts, equipment failure and huge impacts to customers. Yet upgrading mega infrastructure to generate and service power is very expensive.

Huge Savings Potential
Growing cannabis, especially indoors, requires an enormous amount of electricity. Standard equipment in one midsize indoor grow house uses roughly 13.5 million kWh of electricity each year, or the equivalent of 790 residential homes. Around 2,000 facilities are opening in Washington State and roughly 1/2 of them indoors.  The resulting new load could represent nearly 150% the electric consumption by Seattle City Light (more details in a future post). Upgrading to efficient lighting can cut that nearly in half. Every year.

Growers are Customers Too
Electric utilities are mandated to meet customer power needs. In order to exist as a legal monopoly utilities must provide electricity to customers in their service territory. In general, they cannot choose whom to serve, how much electricity to distribute, or which industries to supply.

Lowest Cost
So how will utilities meet growing electric demands? Although the question is complex, the options boil down to (a) using less or (b) new infrastructure. Of those, the least expensive option is paying people to use less, or in utility speak, “investing in energy efficiency as the lowest cost resource”. For example, insulating a house is more cost effective than adding a solar panel. Widespread efficient lighting is less expensive than building a new power plant. And because utilities are funded by ratepayers, utility decisions directly affect power bills.

Preventing “Lost Opportunity”
Because cannabis is a new industry, many businesses are setting up operations for the first time. Utilities would like to influence lighting decisions before growers purchase lights. It is difficult to motivate a grower to change a lighting system once it’s installed. Therefore, utilities want to influence purchase decisions by offering high rebates in a new market, before it becomes a lost opportunity.

Accelerate Preferred Technologies
Currently, the price of efficient lights is 2-4 times greater than inefficient lights.   Utilities hope that by encouraging efficient technologies through rebates, adaptation will become widespread and prices will drop. Ultimately, efficient technologies might be included in regulations or become standard practice, and rebates will be unnecessary. Therefore, now is the time to access grow lamp rebates.