Will the Energy Crisis Impacting European Greenhouse Growers Flow Into the U.S.?
November 16, 2022 When I attended the Indoor AgTech Innovation Summit in New York this past summer, one of the key takeaways was that despite the vast potential of the controlled-environment agriculture (CEA) industry, the major Achilles heel could be energy prices. While the industry is taking steps to navigate this challenge, from local utility rebate programs to alternative energy sources, the reality is that not all businesses will survive.
In fact, during the summit, the New York Times released an opinion piece on the future of indoor farming which noted that while investments in CEA production are growing rapidly, and likely position it as a big part of the long-term future of food production, the industry’s carbon footprint is a challenge that must be overcome.
Fast forward to today, and we already see this situation playing out in Europe. Earlier this month, the website DutchNews.nl (via RTL Nieuws) reported that the world’s biggest orchid grower, SO Natural, was being forced to stop growing blooms because of mounting gas prices. The company produces more than 14 million orchids a year for supermarkets and shops across Europe. But despite substantial investments, new owner Watertoren Hazerswoude is pulling the plug on the heat-intensive orchid trade, citing that growing orchids is no longer possible with current and future gas prices. The business will be sold off over the next few years, according to documents deposited at the Chamber of Trade.
Meanwhile, MENAFN in Finland reports that rising energy costs are causing German farmers to shut down their greenhouse operations and stop growing crops like tomatoes, which thrive at high temperatures.
The energy crisis that has ravaged the European Union for the past year has reportedly led to vegetable farmers in Germany choosing lettuce over tomatoes and cucumbers since it requires less heat and is less profitable. Instead of waiting for assistance from the government, some growers of winter vegetables want to purchase a combined heat and power generator that runs on liquified natural gas.
Could the same thing happen here in the U.S.? The good news is that the industry is being proactive in addressing these potential future challenges. For example, Dr. Greenhouse, Inc., a provider of state-of-the-art HVAC design and controls solutions for indoor grows, vertical farms, and greenhouses, has released a new “Literature Review of Energy and Water Use in Controlled Environment Horticulture and Potential Efficiency Opportunities.”
The collaboration among Dr. Greenhouse, Pacific Gas and Electric Company (PG&E), and 2050 Partners aims to provide an overview of previously published works, specifically the current state of knowledge about the controlled-environment horticulture (CEH) industry and its energy and water use. In addition, the literature review identifies potential energy-saving measures for consideration in future California Energy Code cycles as they relate to greenhouses and indoor farms used to grow vegetables, ornamentals, cannabis, and other crops. Learn more here.
Still, more answers are needed, which is why we want to hear from you. How are energy costs affecting your production plans for the next few months, regardless of the crops you’re growing? We’d love to hear from you. Send me an email at [email protected], or submit a comment below.
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