Cannabis Gold Rush or Bust
Podcast 

Cannabis Gold Rush or Bust?

Mike Nowak , , , , , , , , , , ,

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(January 5, 2020) On January 1, 2020, Illinois became the 11th state to legalize recreational cannabis. Unsurprisingly, that led to massive lines at dispensaries–at least in Chicago. But the legalization of Cannabis sativa for recreational ingestion in Illinois comes one year after the approval of Cannabis sativa for hemp production. Will that lead to a cannabis gold rush or bust? I guess it depends on which kind of cannabis you’re looking at.

A little more than a year ago, we reported on the passing of a law that allows the cultivation of industrial hemp in Illinois. This followed the passage of the 2018 Farm Bill, which legalized commercial production of hemp across the United States. But, as I have already written, the two forms of the plant are quite different, even though they are the same species.

I hate it when that happens! As I wrote last year,

Part of the confusion is caused by binomial nomenclature, the system created by Carl Linnaeus to name all living things. Both marijuana and hemp are the same species–Cannabis sativa–yet they have very different properties.

…in most western countries industrial hemp is distinguished from marijuana on the basis of THC (the chief intoxicant in marijuana) content, which allows the growing of industrial hemp for fiber and seed. Regulations in the E.U. and Canada (31 countries currently grow industrial hemp) limit THC levels in hemp flowers to 0.2 percent and 0.3 percent, respectively, and prevent attempts to camouflage marijuana in hemp fields. Comparatively, THC levels in marijuana flowers are generally between 3 percent and 15 percent.

And, at the time, I discovered a site called marijuana and hemp myths. It revealed some interesting things.

The THC levels in industrial hemp are so low that no one could get high from smoking it. Moreover, hemp contains a relatively high percentage of another cannabinoid, CBD, that actually blocks the marijuana high. Hemp, it turns out, is not only not marijuana; it could be called “antimarijuana.”

There’s a lot more on that website. I encourage you to read it. As it is, the cannabis gold rush proved to be more myth than reality in 2019. But that didn’t stop folks from attending the Illinois Department of Agriculture Hemp Summit in December of 2019. As we move into 2020, the USDA announced that it will continue taking public comments on proposed federal hemp rules until January 29 of this year. However, the Illinois Farm Bureau says that the USDA rules could prove difficult for some growers.

But the best quote of this post comes from a story in the Alton Daily News about the Hemp Summit.

Jeff Fulgenzi, CEO of US Hemp Group, grew about four acres of hemp this year. He said there is huge potential, but concerns remain, especially with a limit of 0.3 percent THC on hemp crops. Crops over that limit must be destroyed. Fulgenzi said the limit needs to be raised.

“The notion that I’m a quality hemp farmer at [0.3] percent THC in my plant, but at [3.5 percent] I have an illegal crop and the worst marijuana in the world that no one wants, so we need a greater threshold,” Fulgenzi said. 

This is a huge, complex story, and we’ll do our best to give it some perspective this morning. Rachel Berry, who spoke to us last year, joins us again. Liz Rupel from the Illinois Stewardship Alliance is also on the show. For more information, go to the Illinois Hemp Growers Association.

By the way, if you’re interested in hemp production, here are some events to consider.

Hero Power is a cleaner energy source

According to a new report issued by the National Renewable Energy Laboratory (part of the U.S. Department of Energy), in 2018, an estimated 6.3 million U.S. customers bought green energy that equaled a total of 134 million megawatt-hours (MWh) of power. That’s an increase from 2017, when the NREL estimated 5.5 million retail electricity customers procured about 112 million megawatt-hours (MWh) of green power, representing about 26% of all U.S. renewable energy sales, or about 3% of all U.S. retail electricity sales. According to a recent article by Axios,  “Out of America’s 127 million households, about 3.7%, or roughly 4.7 million, buy green electricity through different programs. That figure has grown nearly 250% since 2010.”

Most consumers purchasing green energy are purchasing the green power either from their utility company, or through a third-party supplier, and their homes aren’t directly powered by wind or solar. According to a recent article in the New York Times,

That’s because companies generally cannot send renewable energy directly to your home. Once electricity is in the grid, suppliers cannot distinguish the power produced by solar and wind farms from the power produced by fossil fuels, hydroelectric dams and nuclear plants.

To get around this problem, power companies came up with renewable energy certificates (R.E.C.s). Each certificate represents a given amount of electricity that’s been generated from renewable sources. When energy companies produce that power, they get certificates they can sell to consumers. So, when you sign up for green energy, you’re really buying those renewable energy certificates.

“Short of having a solar array on your roof and keeping all those electrons to yourself, it’d be really hard to figure out what type of electrons you’re using if you didn’t have something like R.E.C.s to keep track of the math,” said John Rogers, a senior energy analyst at the Union of Concerned Scientists.

According to the Customer First Renewables’ website, 24 states, including Illinois have deregulated their electricity markets, allowing non-utility companies to sell electricity to retail suppliers that then to sell it to end-users. Many of those states also allow customers to choose their own electricity supplier to benefit from potentially lower rate and options including renewable energy.

Here’s where it gets confusing and where things have sometimes gone south in recent years with the exponential growth of alternative energy suppliers and a lack of regulation in the industry. Many consumer complaints that have arisen in Illinois and elsewhere due to confusing programs and plans with unpredictable rates and billing. In 2018, the Illinois Citizens Utility Board issued this Consumer Alert about alternative electricity suppliers, and the Illinois general assembly passed the Illinois Home Energy Affordability and Transparency Act (HEAT Act) – more on that later.

While the alternative supplier market is unregulated, an independent third-party certification program administered by the non-profit watchdog group Center for Resource Solutions called Green-e has become the leader in clean energy certification, and a resource for consumers looking to make an informed switch to reliable and competitive green power. The New York Times article we quoted earlier goes on to say:

Green-e does two important things: It verifies that the energy concerned actually does come from renewable sources, and it makes sure that the certificates are not double-counted. The E.P.A. recommends that consumers buy from companies with a Green-e certificate.

One new alternative power supplier that’s recently emerged in the Illinois market is Indiana-based Hero Power, which is Green-e certified. In full disclosure, Hero Power is a sponsor of The Mike Nowak Show. According to their website,

Hero Power matches 100% of your electricity use with Renewable Energy Certificates. Your service doesn’t change. Your bill won’t change. Switch and ComEd will send the supply portion of your bill to us and we’ll pay a wind farm. And did we mention we’re the same rate as ComEd ($.07224/kWh)?

…Our product and mission aim to fasttrack Chicagoland’s switch to 100% clean energy, allowing concerned residents to spend their money on renewable energy and invest in a cleaner future now…  Supporting renewable energy doesn’t have to come at a premium cost. Every person or business should be able to contribute to a clean energy future without worrying over their monthly bill. Hero Power will sell power matched 100% by Renewable Energy Certificates (RECs) at the same price as ComEd’s Basic Electric Service (BES).

Hero Power co-founder Ty Benefiel joins us on this morning’s program to talk about the current state of renewable power in Illinois, help us understand what a REC is and how it works, and talk about the brand new Illinois HEAT Act that went into effect January 1, 2020. According to Hero Power,

The Citizens’ Utility Board (CUB) called it “one of the nation’s toughest consumer-protection laws to fight rip-offs peddled by alternative electric and gas suppliers.” It was desperately needed.

According to the ICC, Illinois residents have lost close to $800 million by switching to an alternative electricity supplier since 2015 alone. The HEAT Act force alternative electricity suppliers to provide critical information to their customers to better understand their electricity bills. Customers are eager for the change. According to the Plug In Illinois website, the ICC received an average of 22 complaints per alternative electricity supplier in the last six months of their reporting (November 2018 to April 2019). Of these complaints, 78% were complaints about sales and marketing practices. The HEAT Act helps combat deceptive marketing practices and implements better protections against massive rate hikes without notification.