Canada: Spotlight On Cannabis – Part 2: Taking A Closer Look At The Environmental Costs Of Cannabis Cultivation

As Canada becomes set to be the first G-7 country to legalize recreational cannabis when the Cannabis Act (Bill C-45) comes into force on October 17, 2018, attention is now turning to the business of cannabis. In its 2018 Cannabis Report, Deloitte anticipates that the total cannabis market in Canada (including medical, legal and illegal recreational products) will generate up to $7.17 billion in total sales in 2019. The legalization of cannabis brings with it not only significant policy impacts (an overview of the regulatory framework is set out in our blog, Spotlight on Cannabis – Part 1: Legislative Framework for the Regulation of Cannabis in Canada), but it also introduces a dynamic new market for a broad range of cannabis-inspired products for consumers. Until now, much of the discussion around cannabis legalization has been on public health and safety, however there are increasing calls for policy makers to consider the environmental impacts of cannabis cultivation on a commercial scale.

A Closer Look at the Environmental Impacts of Cannabis Cultivation

On a commercial scale, cannabis is grown in specially designed indoor facilities or in greenhouses. Environment and Climate Change Canada (ECCC) has indicated that they are not contemplating the implementation of cannabis industry-specific environmental regulations, meaning that cannabis facilities will be subject to applicable federal, provincial and municipal laws as they relate to environmental matters. The primary environmental issues arising from  the production of cannabis on a commercial scale include contaminated sites management, water use, effluent and waste management, odours and air quality, energy use and greenhouse gas (GHG) emissions. Each of these issues is discussed in further detail below.

  • Contaminated Sites Management: In a number of provinces and territories, producers are taking former industrial sites (such as former mill sites) and re-purposing them for cannabis cultivation. Where a producer is looking to acquire a former industrial facility and convert it into a cannabis facility, careful due diligence is required to assess the scope of any remediation requirements to address any historical contaminants on the property. Depending on the nature of historical activities on the property, remediation costs could be potentially significant. During the life of the facility, producers will need to implement robust environmental management systems in order to ensure compliance with regulatory requirements, particularly as they relate to incident response and reporting. At the end of the life of a cannabis facility, remediation of the site may be required, particularly where the operations used or produced hazardous substances. Where a site is being leased to a cannabis producer, the parties will want to carefully consider the scope of environmental monitoring and reporting obligations, as well as environmental indemnity and insurance provisions. In certain circumstances, an environmental baseline report may be advisable in order to manage potential environmental risk and allocate responsibility for remediation activities between the parties, particularly where there is pre-existing contamination on site.
  • Water Use: The production of cannabis requires large volumes of water, particularly where cannabis is cultivated outdoors when water use may increase as a result of weather conditions. Industry estimates indicate that a cannabis plant needs approximately 22 litres of water a day; in comparison, a wine-producing grape plant uses approximately 12 litres a day. Water used in cannabis production must meet strict quality standards in order to satisfy the demands of rapid maturation and high yields. As a result, cannabis facilities may be faced with consistency issues as they relate to the quality of irrigation water, which will depend on the nature and location of their water sources. Where an aquifer is depleted, fungus and bacteria can more easily enter a facility through contaminated water. This may be problematic because foliage and root fungal diseases that affect cannabis plants tend to thrive in the warm and humid conditions of grow facilities. There are different ways in which producers can improve the quality of water, including carbon filtering, reverse osmosis and ultraviolet sterilization. Another issue the producers must keep in mind is water conservation. In California, studies have suggested that irrigation for outdoor grow operations are having significant impacts on local watersheds as a result of the diversion of water for cannabis production. Where water permits are required to divert water from either surface or groundwater sources, regulators will be looking closely at impacts to local watersheds (particularly in areas prone to drought) and considering potential environmental flow needs in the region.
  • Effluent Management: Depending on production methods, cannabis grow operations may generate effluent containing growth nutrients and pesticides, which could have potentially adverse environmental impacts on local ecosystems. For example, the use of reverse osmosis to purify water can result in a high concentration of brine, which poses difficulties for removal at water treatment plants. Also, the use of cleaning agents can result in high levels of contaminants in wastewater discharges. As a result, producers may need environmental approvals to discharge effluent or to monitor operations to ensure compliance with applicable effluent discharge requirements or restrictions. Producers with facilities near fish bearing habitat will also need to monitor the potential impacts of their operations on fish and fish habitat to ensure compliance with Fisheries Act requirements, in particular sections 35 and 36 of the Fisheries Act, which prohibit activities that result in serious harm to fish and the deposit of deleterious substances into fish bearing waters, respectively.
  • Solid and Organic Waste Management: From agricultural inputs, equipment and harvesting waste to cannabis product packaging, cannabis production generates a significant waste stream. It has been reported that in Washington state (where the legal marijuana industry has been operating since 2014), the industry had generated 1.7 million pounds of plant waste as of 2017, a significant amount of which is being disposed in landfills rather than being composted. While composting is encouraged for handling plant waste, the composting process can take months and requires a significant amount of space. As a result of these limitations, producers have so far relied on mixing plant waste with other waste in order to dispose of it in landfills.

In order to comply with the applicable waste management scheme in their province or territory, producers will need to ensure that they have appropriate environmental management systems and compliance mechanisms in place. The types of processing waste that must be assessed for proper disposal include:

  • waste from solid plant material, such as stalks, roots, or soil;
  • solvents that were used in processing (e.g. for the purpose of producing a concentrate);
  • any laboratory wastes that were used during processing for quality assurance testing;
  • any plant waste or extract that is not being used because it does not meet quality standards or has been contaminated in some way; or
  • any hazardous waste.

Health Canada requires that plant waste be rendered inert and unusable, with methods including mixing it with other materials for landfill disposal, incinerating it or mixing it with other organic materials for composting. With industry forecasts suggesting that over 1,200 metric tonnes of cannabis will be produced in Canada by 2020, resulting in more than 6,000 tonnes of waste, producers are being encouraged to seek innovative solutions to reduce their waste streams and divert as much waste from landfills as possible.

  • Odour and Air Quality: Cannabis cultivation can impact air quality through plant growth and extraction processes. In particular, the growth of cannabis plants emit terpenes, which are a type of volatile organic compound (VOC) known for their strong odour. In facilities where cannabis-infused products are produced, the evaporation of solvents and other production processes can also result in VOC emissions. The installation of filtering systems and control technologies can reduce the amount of VOC and odorous emissions released from the cultivation process. In Colorado state, the Denver Department of Public Health & Environment has compiled a list of best management practices for reducing odours and VOC emissions. Given that VOCs can potentially impact air quality, producers will need to consider the applicability of local air quality requirements, which may entail registration, permitting or reporting requirements. VOCs can also cause off-site nuisances to neighbouring properties, the effective management of which will require a well thought-out communications and community relations strategy.
  • Energy Use and GHG: The cultivation of cannabis is an energy intensive activity, particularly for the indoor production of cannabis which requires high-intensity lighting, air conditioners, and dehumidifiers to regulate humidity and temperature. The Northwest Power and Conservation Council has calculated that it takes approximately 5,000 kWh to produce (indoors) one kilogram of cannabis product – put into context, this is the same amount of energy an average Canadian household would use in 4 months. The greenhouse cultivation of cannabis is much less energy intensive, resulting in a smaller energy footprint. Whether the crop is grown indoors or outdoors, producers may benefit from measuring the carbon footprint of their operations to find opportunities for reducing energy use and associated GHG emissions. System designs that take into account targeted lighting levels for optimal growth and the installation of efficient climate systems (which include heating, ventilation, air conditioning and dehumidification components) will be critical to the development of more sustainable cultivation processes. Another aspect that is worth exploring is whether any government-sponsored energy efficiency programs or incentives have been made available for industrial facilities to encourage the transition to less energy intensive modes of operation.

As ECCC has indicated, cannabis production processes will be subject to existing environmental laws. While some jurisdictions such as California have established a licensing regime specifically for commercial marijuana production and processing facilities, ECCC has said that it is not planning any industry-specific regulations for cannabis facilities. That said, producers should monitor the development of any industry-specific environmental requirements that may be imposed by provincial and municipal governments. As governments grapple with the regulatory implications of growing cannabis on a commercial scale, regulators may look for guidance in environmental regulations that have already been established for greenhouse crops such as green peppers, tomatoes, and forestry seedlings. In addition, the introduction of certification and eco-labeling programs may help not only to create an industry standard that consumers can rely upon, but also to incentivize environmental best practices.

To view original article, please click here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Topics
 
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions