Market News

 May 19, 2020
World Wildlife Fund tries to spark an indoor farming revolution

 A network of caves in St. Louis, Missouri, was once used for brewing beer before the advent of refrigeration. Now, the conservation organization World Wildlife Fund is interested in helping the city repurpose some of that unused space for indoor farming---in a new pilot that can demonstrate how the indoor agriculture industry can become more sustainable and a viable way to make the food system more resilient.

The organization is best known for its work to save iconic species, such as protecting tiger habitat or reducing demand for elephant ivory. But within a section of the nonprofit called the Markets Institute, it also studies trends in agriculture and ways to help lower the massive environmental footprint of growing food, from the energy and water used on farms to the impact of clearing forests to make room for farmland.

The institute, launched in 2016, works with partners across the food industry on challenges such as how to prevent food waste or how to deal with impacts from climate change in the cocoa industry supply chain. The organization recognizes that the entire food system needs to change to protect nature, and it can play a role in catalyzing that change in the business world.

"We're looking for new business models, new strategies and partnerships, and different ways of approaching things that are financially profitable as well as environmentally sustainable," says Julia Kurnik, director of innovation startups at World Wildlife Fund. "Our goal as an institute is to find things that can happen quickly and at scale, so that's why we're interested in making sure they can really take off and live beyond our investment."

It saw promise in the nascent indoor farming industry. Companies that grow produce in greenhouses, or stacked in vertical units inside warehouses, can grow more food on far less land than traditional farming, leaving room for forests to stay in place or be replanted. The methods they use to grow food without soil also use far less water. If indoor farms are distributed in cities, they can also help avoid the carbon footprint of trucking produce thousands of miles across the country. Because the spaces are sealed and insects can't get in, they can also avoid pesticide use; the produce is also more uniformly perfect and gets to customers more quickly, so there's less food waste; the farms also aren't affected by extreme weather outside, so crops won't be lost in storms or impacts from a changing climate.

Still, indoor farms aren't environmentally perfect. In a new report, World Wildlife Fund examined the total environmental footprint of growing lettuce on fields in California versus a hypothetical indoor farm in St. Louis. The organization chose St. Louis for its study and pilot after searching for cities that met a certain list of criteria---a climate that doesn't allow for year-round growing, a large population, and stranded assets that could be used as infrastructure for growing food. Because of St. Louis's unique industrial infrastructure, including the abandoned caves, it was chosen from a short list of 10 cities. (WWF is not investing in the projects itself, just helping set up the infrastructure for governments and companies to work together on the effort.)

In its study of the potential of indoor farming in St. Louis, the organization confirmed that soilless indoor growing can save land and water, but the researchers also identified challenges. The lights used to grow crops indoors use large amounts of energy, though the technology has become more efficient, and generate so much heat that greenhouses often have to use air-conditioning to maintain a steady temperature, even in the winter. If you grow lettuce in Monterey, California---in a region where much of the country's lettuce is grown---and ship it to St. Louis, the carbon footprint is lower than growing in a standard indoor farm in St. Louis now. That's because St. Louis still gets most of its energy from coal, and that outweighs the footprint of driving lettuce long distances in a refrigerated truck or the benefits from avoiding pesticides or food waste.

The report also examines ways that the industry could shrink that footprint, from fiber-optic tech that can bring sunlight into a room to options for renewable energy. If the farms can use less energy, there's also an economic benefit---and that will begin to make it possible for companies in the industry to expand beyond growing leafy greens. Greens such as lettuce and spinach are common now in indoor farms because they grow more quickly than, say, strawberries or tomatoes, and they fit within the economics of current growing systems.

In St. Louis, the nonprofit is bringing together a group of stakeholders, including existing indoor farming companies, local plant science experts, community groups, the local power company, potential funders, and potential customers such as grocery stores, to test new alternatives. Several types of unused or underused infrastructure may work as farming space, such as cold storage in postal hubs, or space next to power plants that can take the excess heat from an indoor farm and convert that into energy.

The city's caves are of interest because they're naturally cool, helping offset the need for air-conditioning. By the end of the year, the aim is to have an agreement for a pilot design, either a single farm or a network of farms, that can be built in the city in 2021. "We won't build the farm or own the farm," says Kurnik. "Our model here is to bring all the players together."

Once the pilot proves how well the new approaches work, that can be shared more broadly with the industry. The project may also be able to share some knowledge about technology such as automation, which can help bring down the cost of growing. (Labor is a major expense at indoor farms, and robots can help address that, while also spurring the creation of some more highly paid jobs in the industry than farm labor.) Right now, existing farms "are each investing in their own technology and R&D," she says. "If there were standardizations across some of that, it might be able to boost the entire industry."

Communities outside St. Louis will also be able to learn from the pilot, both as a way to reduce the environmental footprint of their local food supply and a way to make the supply chain more likely to survive disruption from climate change. While interest in indoor agriculture is already growing in some areas---for instance, water-starved Abu Dhabi, which wants to create a more resilient food system that doesn't rely as much on imports---it could eventually be much more widely used elsewhere if the energy and economic issues can be addressed. In California, increasing drought may eventually make traditional farming less and less feasible. Other impacts from climate change, including extreme heat and increasing storms and floods, are also beginning to make traditional farming more difficult. Indoor farming "has potential to be one tool in the toolbox for tackling those things," says Kurnik.