Greening the Pot Industry

This RMI briefing discusses the significant electricity demand generated by the legal marijuana industry in the United States and proposes strategies for utilities and regulators to manage this load. It suggests that energy efficiency investments, on-site renewables, and time-varying rates to shift consumption to periods of low net load can help integrate renewable energy and reduce operating costs for growers.

• Legal marijuana cultivation has a very high energy density, similar to data centers, because over 90 percent is grown indoors using high intensity lighting and climate control. In 2015, the industry in Colorado consumed 300 GWh of electricity, which accounted for more than 2 percent of Denver's total demand. New legal markets in California and other states could generate several terawatt hours (TWh) of new demand, a volume comparable to the total demand of Rhode Island or Washington, D.C.
• Energy costs represent 20–50 percent of operating costs for growers. While LEDs provide energy savings by using less power and reducing heat—thereby lowering HVAC requirements—adoption is hindered by a lack of low-cost capital due to the federal illegal status of the industry and early reports of reduced cannabis yields.
• Up to half of the energy load in marijuana operations is driven by lighting schedules, which can be shifted to align with periods of low net load to better integrate renewables. For example, in Colorado, moving vegetation and flower lighting schedules could reduce lighting demand by up to 72 percent during the 2–6 p.m. peak. In California, shifting consumption to the middle of the day would align with high solar generation and avoid evening peaks.
• To manage the impact of marijuana load on the grid and help growers reduce costs, utilities should implement time-varying rates tailored to the industry. This approach is compared to the integration of electric vehicles and the industry-specific rates already used for data centers. One utility in Washington State has already implemented a marijuana-specific rate.

APA

RMI (2016). Greening the Pot Industry. https://rmi.org/resources/greening-pot-industry/

Chicago

RMI. Greening the Pot Industry. 2016. https://rmi.org/resources/greening-pot-industry/.

Wikipedia

{{cite report |author=RMI |title=Greening the Pot Industry |date=20 December 2016 |url=https://rmi.org/resources/greening-pot-industry/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2016greening, author = {{RMI}}, title = {{Greening the Pot Industry}}, institution = {RMI}, year = {2016}, month = dec, url = {https://rmi.org/resources/greening-pot-industry/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }