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New energy regulations may lead to cannabis supply shortages in MA

August 9, 2018

WashingtonNew Frontier Data, the global authority in data, analytics and business intelligence in the cannabis industry, releases 2018 Cannabis Industry Trends Report: Market Insights. This report examines trends in the burgeoning cannabis industry across the United States and explores market demand, federal and legislative action, compliant banking practices and the opioid epidemic. In Massachusetts, new regulations, including the nation’s tightest restrictions on energy use among cannabis growers, fueled concerns of supply shortages when adult-use market sales began in July 2018.

“Among Massachusetts’ initiatives to curb overall energy-usage levels by 2020, the state wants to reduce greenhouse gases. The Cannabis Control Commission set final rules for the adult-use cannabis industry to cap electricity use, and in order to meet the restrictions, cultivators were prompted to switch to more energy efficient, but more expensive, LED lighting. This is the first known instance where a specific technology (LED) was mandated by regulators, so we will have to wait and see if other states follow this precedence,” saidBeau Whitney, New Frontier Data Senior Economist.

While more cultivation licenses have been issued (a total of 24 growers were expected to be operational by June) those new cultivation facilities will not have any immediate impact on the supply since it can take between 18 and 36 months between initial licensing and the first harvest.

In the short term, some of the mandated energy regulations can prove themselves difficult to enforce, and should they become too restrictive will push cultivators to operate in the illicit market. Ultimately, however, for the cannabis industry to continue to grow in line with expectations, energy use must become a primary strategic consideration. Cultivators’ energy sophistication will not only be a key driver of economic success as markets become increasingly price-sensitive, it will also be critical to the industry’s ability to successfully integrate with the mainstream.

Visit www.newfrontierdata.com/trends to download the full report. About New Frontier Data: New Frontier Data provides objective, rigorous and comprehensive analysis and reporting about the nascent and underserved cannabis industry worldwide. New Frontier Data’s analytics and reports have been cited in over 65 countries around the world to inform industry leaders, investors, policymakers and others. New Frontier Data, the premiere and only Big Data shop in the sector, looks beyond plant cultivation and distribution to raise the industry bar and improve visibility into what will inevitably soon be a mature and more complex global market. Founded in 2014, New Frontier Data is headquartered in Washington, D.C. and has additional offices in Denver, Colorado.

New Frontier Data does not take a position on the merits of cannabis legalization. Rather, its mission and mandate are to inform cannabis-related policy and business decisions through rigorous, issue-neutral and comprehensive analysis of the legal cannabis industry. For more information about New Frontier Data please visit: www.newfrontierdata.com.

 

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