Schneider Electric’s Don Wingate discusses how microgrids can help the indoor vertical farming movement realize its full potential.
While indoor agriculture has steadily gained traction in recent years as the world seeks alternative ways to feed growing populations, the uncertainty of today’s global pandemic has accelerated a rethinking of the way we obtain our food. In the last few months, modern supply chains experienced volatility like never before and it wasn’t long before we started to see the impact beyond medical gear and personal protective equipment and began to affect food production. According to the Institute of Supply Chain Management, 75% of companies reported some kind of supply chain disruption due to COVID-19.
Indoor vertical farming is emerging as an alternative to conventional farming because it both requires lower land-use and introduces the opportunity to bring agricultural production closer to consumers — shortening supply chains and increasing footprint productivity. This is especially important during times of turmoil, which is broader than the current pandemic as weather events and changing climate patterns continue to put constant strain on traditional farming practices. In addition to shortening supply chains, indoor farming has many other advantages in comparison to traditional agriculture such as using zero pesticides, employing 95% less water and reducing food waste. Health benefits also include fresher food, increased urban availability and pollution reduction.
Despite the major advantages, there is one looming barrier to mainstream adoption: the process is very energy intensive.
Solving for the energy intensity problem
Vertical farming presents a unique opportunity to grow food on already developed land and increase domestic food production, but the energy demand required to power these facilities is much higher than other methods of food production. In fact, we’ve identified indoor agriculture as one of the four major drivers that will increase electricity consumption in the next decade, along with electric vehicles, data centers and the electrification of heat. This is why more of today’s modern farming companies are turning to microgrids as a possible solution to ease their energy challenges.
Although most of today’s facilities are not equipped to meet the electricity needs of an indoor agriculture operation, microgrids can provide dynamic energy management and the resources required to support maximum productivity, sustainability, and energy efficiency. They can provide localized power generation and utilize renewable distributed energy resources to help deliver power and reach clean energy goals, while also allowing users more control and reliability. Additionally, microgrids can capture and repurpose CO2 emissions to help in crop production.
Moreover, microgrids provide resilience from unexpected outages that could result in a loss in production. A key advantage of vertical farms is their ability to allow crops to grow year-round, and communities rely on their ability to deliver on this promise. Microgrids not only have several clean energy benefits, but they also increase business continuity that maximizes output. Given their ability to operate either in conjunction with or as an island from the utility grid, they can keep the farm producing even when the grid goes down.
The case for investment: Securing an affordable solution
Building and operating a vertical farm requires various technologies that can translate to high startup cost and design complex processes. At the same time, it is more expensive to maintain a vertical farming operation than traditional field farming. Microgrids offer a compelling value proposition, but they’re inherently complex machines and not many companies have the upfront capital or in-house expertise needed to make the investment. Fortunately, innovative business models such as energy-as-a-service (EaaS) help provide price certainty and make the investment attainable.
For example, a modern farming company, Bowery Farming, created a facility wherein crop production is 100 times more efficient than traditional farmland. This generated a need for greater need for reliable, efficient power. Thus, the company made the decision to integrate a hybrid microgrid system that would feature a rooftop solar array, natural gas generator and a lithium-ion battery energy storage system through an EaaS business model. Through EaaS, Bowery Farming saved upfront capital that can be used toward additional operational investments.
By 2050, the world’s population is expected to grow by another 2 billion people, and feeding it will be a major challenge. According to the projections of the Food and Agriculture Organization, we have to increase overall food production by 70% by this timeline. Coupled with new concerns that have surfaced as a result of today’s global pandemic and unstable weather, vertical farming will play a key role in future food production and institutions will take notice. However, the technology that will help ease some of the industry’s ongoing energy challenges will be just as important to aid the transition.
Don Wingate is the VP of utility and microgrid solutions at Schneider Electric.