The business case for investing in LED lights for your growing operation
Technology is one of those things that is always changing, and it isn’t always easy to know when to upgrade – and when to maintain the status quo. But when it comes to a cannabis growing operation – either commercial or hobbyist – there is a strong business case for making the investment in LED lights.
Hands down, LED lights are the most cost-efficient way to grow cannabis – but only if you look at the long game. In the short game, LED lights are more of an investment and that can turn some growers off because it is a higher cash outlay – especially if there has already been an investment in old technology (otherwise known as HPS grow lights) for the growing operation.
When a grower has been at it for a while, using HPS grow lights, it can be hard to embrace change. After all, HPS grow lights are a proven commodity. They are reliable. They are known.
When making a business case to switch to LED grow lights for your growing operation, it can be a tough sell. So, why make the upgrade? What is the main reason that LED lights are superior?
It all comes down to about $1.3 million reasons – which is the estimate in savings over a five-year period in a 10,000-square-foot grow facility after switching from HPS grow lights to LED grow lights. And that’s a conservative estimate.
So, how do LED grow lights facilitate this kind of cost savings? When you back out the upfront capital costs of switching to LED (about $280,000), the main savings are in electrical costs – both the cost of running the lights themselves and the electrical costs of running an HVAC system to keep your facility at the proper temperature.
LED lights are just more energy efficient – and cooler. Meaning you pay less to the electric company (and have more money in your pocket). If you are considering the switch from HPS to LED lights, here are some other things to consider.
LED grow lights have a major advantage over HPS grow lights for growing operations and it boils down to one reason: Efficiency. In a head-to-head contest, LED lights use less power, generate less heat and require less maintenance than HPS lights.
LED grow lights are more energy efficient, and generally, growers can save about $500,000 over five years when they switch from HPS lights in energy and HVAC costs alone in a 10,000-square-foot facility (using the national average of $0.12/kwh).
And that segues neatly into one of the reasons why LED lights are superior to HPS: They are cooler – temperature-wise. Any grower knows you need to manage the temperature in the grow facility or the plants won’t thrive. When you use HPS lights (which run hot) you need to use electricity to maintain the temperature – fans, air-conditioning, and ventilation. So, growers are spending money to run HPS grow lights AND spending money to manage the heat they produce. That is wasting money – and cutting into your profits. If you do require additional heat during the winter months then heating the facility up with HPS heat is a very expensive way of doing it.
LED lights are also lower maintenance, which means less labor and cost in replacing HPS bulbs every 10,000 hours – and change the reflectors. LED grow lights don’t need their bulbs replaced.
Another nifty thing about LED lights is, some states offer rebates to growers who use LED vs. HPS, meaning you could get money back. In some cases, that could be as much as 50% of the cost of the light.
Making the case for saving money with LED grow lights is fairly straightforward, but you can also make a case for making MORE money with them, as well.
There is new research that LED lights can produce higher yields than if HPS lights are used in a growing operation, especially if you use high-quality LED lights with inter-lighting. This is an old technique of dropping the light source below the canopy in an effort to generate additional yield on the stalk.
Some growers have mixed HPS and LED lights, using HPS as their top lighting and LED as their inter-lighting to increase yields. This works well, especially for growers who want to optimize the facility and grow vertically – think up not out.
HPS lights cannot be used for inter-lighting – they are too hot and will scorch plants.
But growers can make two to three tiers and use inter-lighting in between because the lights are cooler.
The Key Takeaway
LED grow lights are here to stay – and they are transforming the cannabis growing industry. Eventually, the federal government is going to keep pushing LED grow lights through incentives and other programs because they do save significant amounts of energy.
In the cannabis growing industry, with new states making it legal all the time and federal legalization on the horizon, it is only going to get more competitive and the profit margins will be harder and harder to maintain.
Upgrading to LED lights now will put a growing operation ahead of the curve, technology wise, and give a competitive advantage.
The business case for LED grow lights is clear – especially for those in it to win it for the long haul.