Recreational cannabis in Maryland is set to become legal on July 1, 2023. This represents a huge opportunity for growers interested in reducing their operating costs, sustainability, and racking up free money for energy-smart upgrades.
The State of Maryland’s Cannabis Market
Medical cannabis has been legal in Maryland since 2014, when Maryland’s medical marijuana program was passed by the General Assembly. Although it took five years for state dispensaries to open, growth has been relatively steady with a peak during the pandemic. State regulators estimate that Maryland’s medical cannabis industry generated $517 million in revenue in 2022 and $557 million in 2021.
Even though maturing cannabis markets typically see a decrease in prices (which may explain the drop in revenue between 2021 and 2022), another boom is expected in Maryland over the coming months with the legalization of recreational cannabis. To give you a sense of scale, the Baltimore Sun reported in January that Maryland would likely need to triple its number of dispensaries to satisfy the demand for recreational cannabis.
Recreational cannabis was approved by Maryland voters last November and is set to become legal on July 1st. However, only current medical licensees are expected to become eligible for recreational licensure on this date; everyone else will have to wait until January 2024, when Maryland’s first adult-use licenses are forecast to be issued. At the moment, Maryland is planning on issuing 20 standard licenses and 30 micro licenses for growers. A second round of licensing is anticipated to begin in May 2024, where an additional 25 standard licenses and 70 micro licenses will be issued to growers. As you can imagine, this will likely result in a lot of new development and an increase in energy usage!
Maryland’s Expensive Energy
Cannabis growers in Maryland might be surprised when they see their energy bills. In addition to indoor cannabis cultivation using an astounding amount of power, Maryland has some of the most expensive energy prices in the country. The reason for this is two-fold: Maryland imports most of its energy resources and also has many legal regulations in place to reduce carbon dioxide and greenhouse gas emissions.
Growers interested in building out new facilities (or updating existing facilities) have tools at their disposal to combat these high energy costs all while being green and climate-conscious. Growers may also be interested in shopping around for more advantageous power supply rates, which you can read about on our blog here.
The Power (and Savings) of Energy Efficiency
Energy-efficient technologies, such as LED grow lights and high-efficient HVAC systems can not only save money on energy bills in the long term, they can make money almost immediately thanks to utility and state incentive programs. Because utilities want their customers to use less power, they often pay their customers to use more energy efficient equipment.
Maryland is no different offers many incentive programs for businesses.
The suite of EmPOWER Maryland programs, which are managed directly by utilities, will be of particular interest to cannabis growers, who can receive $0.25 / kWh saved up to 50% of the project costs, such as:
- LED indoor horticultural lighting,
- Energy-efficient HVAC and controls,
- Energy management systems, and
- Chillers
The EmPOWER Maryland programs are accessible for those using
- Baltimore Gas and Electric Company (BGE),
- Potomac Edison Company (PE),
- Delmarva Power & Light,
- Potomac Electric Power Company (PEPCO),
- Southern Maryland Electric Cooperative, Inc. (SMECO), and
- Washington Gas Light Company (WGL).
As an added bonus, the State of Maryland offers additional programs outside of the standard utility programs, including:
- Combined Heat and Power Grant (CHP): Incentives for CHP projects in commercial, industrial, institutional, and critical infrastructure facilities.
- Commercial, Industrial & Agricultural Grant (CI&A): A competitive program provides grants for deep energy retrofit projects for those businesses not in Maryland’s main electric service territories.
- Commercial Clean Energy Rebate: Receive financial assistance to install:
- solar photovoltaic,
- solar photovoltaic canopy,
- solar water heating,
- geothermal heat pump, and
- wind turbine systems.
Check out our blog post from earlier this year titled, Five Reasons Smart Growers are Focusing on Energy Efficiency, to learn more about energy efficiency and its benefits.
Accessing Valuable Incentive Programs
Although businesses can choose to work directly with these utilities to take advantage of these incentives, they can also work with a utility “Trade Ally,” a qualified third party partner who will submit project information to the utility on behalf of the business.
The Enlighten Your Grow team are Trade Allies at many utilities and are experienced in working with our cannabis clients to understand their options and get the largest rebate possible.
Set up a call anytime with the Enlighten Your Grow team to learn more about how we can help you access these incentives for your grow operation projects.
Be sure to stay ahead of the curve and take advantage of these valuable incentives before all of the upcoming cannabis opportunities in Maryland take shape!