Indoor Grows Could Prove Costly for Hawaii MMJ Businesses

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Medical marijuana dispensary investors and owners in Hawaii could be required to spend millions of dollars on construction and utilities because the state’s interim business rules require that cannabis cultivation be indoors, The Garden Island News reported.

Having to grow indoors may force dispensary owners to recoup the additional costs with a product price increase, said Jud McRoberts, a dispensary project leader on the island of Kauai.

To qualify as an indoor grow site, a building must have concrete floors, steel walls, secured entry points, and its interior cannot be visible from the outside, according to Hawaii’s health department. Greenhouses, which would drastically reduce power expenses, don’t qualify, the newspaper reported.

The interim rules expire July 1, 2018.

Should McRoberts’ team win a license, their planned two 8,000-foot cultivation centers would cost $3.6 million to build and suck-up $1.5 million annually in power expenses.

The cannabis industry’s extensive utility demands have come under scrutiny in recent months, and have been blamed for transformer blowouts and environmental degradation.

Hawaii will award eight licenses for medical marijuana businesses on the islands of Oahu, Maui, Kauai and the Big Island. Each licensee may run two production centers and two retail stores, and can begin dispensing in July 2016, pending state approval.