Energy consumption is not just a financial burden for cannabis extraction companies—it’s a sustainability crisis. As the marijuana industry grows, its energy footprint becomes increasingly problematic, with power usage contributing to environmental degradation and climate change. In fact, energy costs now rank as one of the top two expenses for manufacturing facilities, according to Ben Bourque, executive vice president of Green Meadows Farm.
This challenge is amplified by the urgency of Earth Day 2024, which shines a spotlight on sustainable practices across industries. Forward-thinking cannabis companies are recognizing that reducing energy use isn’t just about cutting costs—it’s about aligning with eco-conscious consumers and complying with future regulations, such as federal legalization mandates.
The good news is that profitability and sustainability can coexist. By adopting smart operational strategies, investing in energy-efficient technologies, and optimizing production processes, companies can slash energy bills while minimizing their environmental impact. From leveraging off-peak electricity rates to upgrading equipment, the solutions are both practical and scalable.
In this article, we’ll explore actionable tactics for cannabis extraction businesses to reduce energy costs, drawing insights from industry leaders like Connor Schilling of High Life Farms and Carlos Perea of Terra Vera. Whether you’re navigating high energy prices in Massachusetts or California’s volatile rate market, these strategies will help you stay competitive while paving the way for a greener future.
Peak and Off-Peak Energy Management
Cannabis extraction companies face a fundamental energy dilemma: high-powered machines like chillers, CO₂ systems, and rotary evaporators need to run continuously, but doing so during peak daytime hours hits their wallets hard. However, by strategically shifting operations to off-peak times and leveraging energy storage solutions, companies can save significant costs while staying competitive.
Off-Peak Operations: When to Turn Machines On
Running energy-intensive tasks during nighttime or weekends when electricity rates are cheapest is a straightforward yet impactful strategy. For example:
- High Life Farms in Michigan schedules its extraction machines during graveyard shifts, paying lab workers a **3 premium per hour** but saving on energy costs that would otherwise be 30% higher during peak daytime rates (Connor Schilling).
- Terra Vera in New Mexico uses solar panels to charge batteries during off-peak hours, then uses stored energy to power chillers and other equipment during the day.
This approach isn’t without trade-offs. Workforce management becomes complex, as companies must balance labor costs with energy savings. Schilling notes: “It’s about calculating whether the premium paid to workers offsets the savings on energy.”
Energy Storage: Storing Power for Profit
Storing off-peak energy is another game-changer, especially in regions with extreme rate swings like California, where prices can vary by up to 13 cents per kWh between day and night (Carlos Perea). Solutions include:
- Battery Systems: Charging batteries with solar power or grid electricity at night to use during peak hours.
- Compressed Air Storage: Filling air compressors at midnight for use in the morning, avoiding peak rates.
At Terra Vera, Perea emphasizes that energy storage not only reduces costs but also enhances resilience: “We’re building a system that’s less dependent on the grid, which is critical for long-term sustainability.”
Labor Flexibility: Adapting Workflows
To minimize energy use during peak times, companies can repurpose staff to handle non-electric tasks. For instance:
- Winterizing equipment or filtering processed material during daytime when rates are highest.
- Cross-training employees to cover both night shifts and maintenance duties, ensuring operations run smoothly without overstaffing.
Equipment Efficiency Upgrades
Modernizing extraction equipment is critical for reducing energy costs, especially as cannabis processors face high operational demands and strict environmental regulations. By investing in energy-efficient technologies and optimizing workflows, companies can lower power consumption, improve yield quality, and stay ahead of competitors.
Automated Machinery: Reducing Human Dependency
- Rotary Evaporators & Chillers: These high-energy machines are best run during off-peak hours (as discussed earlier), but automation reduces the need for constant staff oversight. For example, High Life Farms uses automated systems to minimize labor costs during night shifts.
- AI-Powered Systems: Advanced sensors and software can monitor equipment performance in real time, adjusting energy use dynamically. For instance, some facilities now use IoT devices to turn off chillers when temperatures stabilize, cutting energy waste by 10–15%.
Solvent Selection: Energy-Saving Trade-offs
- CO₂ Extraction: While popular for its purity, CO₂ systems generate significant heat that requires cooling, hiking HVAC bills. In warm climates like Massachusetts (where Ben Bourque operates), this can be particularly costly.
- Alternative Solvents: Switching to ethanol or hydrocarbon-based solvents may reduce energy needs, though they require additional safety protocols and regulatory compliance.
Innovative Equipment for Live Cannabis Processing
Traditionally, cannabis must be frozen, trimmed, and dried before extraction, but new equipment is enabling live processing (using fresh, uncured material). This eliminates energy-intensive preprocessing steps and boosts throughput:
- Live Resin Extraction: Companies like Pueblo Scientific have developed systems that process live plants without freezing, reducing energy use by up to 30%.
- Continuous Flow Systems: These streamlined setups minimize downtime and waste, requiring less energy per unit of product.
Future Trends: Smarter, Greener Machines
According to Carlos Perea of Terra Vera, the next wave of extraction equipment will prioritize both efficiency and sustainability:
- Cannabinoid Optimization: Machines that capture more cannabinoids and terpenes per batch, reducing raw material waste and energy input.
- Heat Recovery Tech: CO₂ systems paired with heat exchangers can recycle waste heat for other processes (e.g., drying).
- Solar-Integrated Designs: Extractors powered directly by renewable energy sources, such as solar thermal systems, are already emerging in California.
Environmental Standards and Lean Manufacturing
As the cannabis industry matures, companies are increasingly prioritizing sustainability through certifications like **Good Manufacturing Practice (GMP)** and lean manufacturing principles. These initiatives not only enhance product quality and regulatory compliance but also directly reduce energy waste by streamlining processes and minimizing resource use.
GMP Certification: A Path to Efficiency
GMP regulations mandate strict controls over production environments, equipment, and workflows. While primarily focused on safety and consistency, these standards create opportunities for energy savings. For example, Colombian firm Clever Leaves optimized its operations after achieving GMP certification in 2023. By adjusting raw material particle sizes and curing temperatures, the company improved cannabinoid yields, reducing energy input per batch. “Sustainability is embedded in our DNA,” said Camilo Bohórquez, the company’s country manager. “Our GMP-aligned processes help us use less energy while maintaining superior quality.”
Lean Manufacturing: Cutting Waste
Lean principles eliminate non-value-added activities, translating to direct energy savings. Cannabis companies are adopting tactics such as:
- Reducing cycle times: At Clever Leaves, streamlined workflows shortened production cycles by 20%, lowering energy consumption per unit.
- Preventive maintenance: Regular equipment checks avoid inefficiencies caused by wear and tear. A malfunctioning chiller valve, for instance, can increase energy use by 30% if left unchecked.
- Cross-training staff: Employees handling multiple tasks ensure energy-saving practices are consistently applied, minimizing downtime.
Synergies Between Standards and Efficiency
Combining GMP and lean strategies amplifies energy savings. For instance, High Life Farms reduced water usage during CO₂ extraction, which in turn lowered chiller energy demand. A 2024 report by the Cannabis Energy Consortium revealed that companies integrating lean practices achieved 12–18% lower energy costs than industry averages, underscoring the economic and environmental benefits of these approaches.
Renewable Energy Integration
Switching to renewable energy sources like solar or geothermal power offers cannabis extraction companies a scalable way to reduce energy costs and carbon footprints. By generating clean energy on-site, facilities can lower reliance on expensive grid electricity, particularly in regions with high energy prices or strict sustainability regulations. For example, California-based Terra Vera uses solar panels paired with battery storage to cut energy bills by 25%, while also enhancing resilience against grid fluctuations.
Implementation tactics vary but focus on site-specific solutions: rooftop solar arrays are ideal for urban facilities, while geothermal systems suit regions with accessible underground heat. In windy areas, small wind turbines can supplement solar power. While upfront costs for solar installations range from 50,000+, long-term savings—combined with tax incentives (e.g., U.S. federal solar tax credits)—typically offset expenses within 3–7 years.
This strategy also aligns with industry-wide decarbonization trends. States like California now mandate 100% renewable energy for certain operations by 2045, creating competitive advantages for early adopters. By integrating renewables with existing energy-saving measures (e.g., off-peak operations), companies can achieve net-zero goals while maintaining profitability.
Conclusion
Cannabis extraction companies can mitigate energy costs and environmental harm by strategically aligning operations with energy pricing cycles, modernizing equipment, and embracing sustainable practices. Shifting high-energy tasks to off-peak hours or using stored renewable energy—such as solar power paired with battery storage—allows companies like Terra Vera to reduce bills by 25% while building grid resilience. Meanwhile, investing in energy-efficient machinery, such as automated systems or live-cannabis processing tools, minimizes power use and waste. Additionally, adopting GMP certification and lean manufacturing principles streamlines workflows, cuts waste by 15–20%, and ensures compliance with quality and sustainability standards.
These efforts not only enhance profitability but also position firms ahead of regulatory mandates, such as California’s 2045 net-zero goal. By balancing cost reduction with eco-conscious innovation, the cannabis industry can transition into a more sustainable and competitive future—one where energy efficiency and environmental responsibility are at the core of business success.
