Energy usage is one of the highest expenses of a grow operation. The largest contributors to usage and cost is HVAC and dehumidification followed by lighting. Utility companies are offering a rebate for businesses who switch to more energy efficient LED lighting products, but time is running out.
Benefits of Adding LEDs to A Grow Operation:
Updating a grow operation to LED lighting not only saves energy, but also offers indirect savings. LEDs offer higher efficiency over traditional lighting (HPS, Metal Halide) by using less wattage to deliver the same or greater intensity of light. Indirectly, LED lighting will save energy by reducing HVAC and dehumidification needs. LEDs do not produce the same level of heat output as more traditional lighting sources, which reduces cooling costs. Plants do not transpire as much with the lower temperatures, which lessens the need for dehumidification.
Energy Provider Rebates:
Rebates are offered by most energy providers as incentives to reduce energy usage. Rebates can range from 25 – 50% of the lighting upgrade costs. Some rebate programs offer dollars per fixture with most agriculture rebates being based on the kWh reduction. For the kWh reductions, rebates usually range from $0.15 – $0.30 per kWh reduced. In Michigan, Consumers Energy offers $0.70 per kWh reduced! LED lights save you money every month on your energy bill, and with the rebates can bring your ROI on new fixture purchases to less than one year.
Once LEDs for horticulture lighting become the baseline, rebates will no longer be offered or will match the new baseline. Some states have already changed their regulations for their energy codes (IL, MA) and others are in the process of changing (MI, OR, CA, WA). Once states update guidelines on how much wattage is allowed per square foot, and LEDs become the norm, there will be no need for energy providers to offer rebates.
USDA REAP Program:
In addition, the USDA is offering grants and low interest, long term loans through the REAP program. These grants will cover up to 25% of your upgrade project costs. Combined with the current utility rebate, your ROI will be achieved twice as fast. Deadline for the USDA REAP application is March 31, 2021. Future competitions will be Oct 31st and March 31st of said years.
The time is now! Do NOT wait!
ROI Scenario for 1-for-1 upgrade to ITC Amplify Vegetative Lamps:
A 5,000 square foot hydroponic lettuce greenhouse used 40 HPS lamps for supplemental lighting to run crops 365 days a year. The farmer was required to rotate crops every few days for even light distribution.
- Total cost of the lamps: $45,000
- Year 1 electricity cost savings: $13,434
- Received Energy Provider Rebate: $11,908
- Received USDA Grant: $11,250
- HPS bulb savings (one set per year not including labor): $2,000
- TOTAL INVESTMENT: $6,408 (Cost of lamps – (Y1 electricity savings + Energy Provider Rebate + USDA Grant + HPS bulb savings ))
- Return on investment (ROI) = 106 days (about 3 and a half months)
Additional Benefits to the Farmer When Switching to Amplify LEDs:
- Increased his yields by 16-20% per square ft.
- Maintained his crop yields thru the peaks of winter.
- Reduce the number of ‘Lit” hours of supplemental lighting from 12 hrs to 7.5 hrs.
- Able to create vibrant colored crop all year long using ITC Horticulture lights and stop buying red lettuce from another farm during the winter months.
- Doubled his lit area over the crop (no more rotating crops for even light) and did not have to upgrade his panel service to do it.
Ready to Get started?
Applying for these programs takes time and can be complicated. Begin the application process as soon as you’re looking into upgrades for your facility. ITC Horticulture provides a lighting layout for your grow area and can file for your local Energy Rebate on your behalf. We can also direct you to information for the USDA REAP grants and loans.
Don’t miss out on significant cash rebates! We will help upgrade your operation with ITC Horticulture Lighting and improve your bottom line for years to come. Contact us today!