Energy Cost Barrier in Indoor Vertical Farming

Indoor vertical farming uses 10–30x more energy per unit of food produced than field agriculture, primarily because artificial lighting is a profoundly inefficient substitute for sunlight. This energy cost makes indoor farms unable to compete with field-grown produce on all but the highest-margin crops (specialty greens, herbs). Between 2023 and 2025, this economic reality drove the bankruptcy or shutdown of AeroFarms ($238M raised), AppHarvest ($700M+), Bowery Farming, Plenty (~$1B raised), Fifth Season, Infarm, and others — approximately 40% of all controlled-environment agriculture (CEA) startups from 2018–2022 failed. The underlying physics hasn't changed: converting electricity to photons to plant growth involves multiple efficiency losses that field crops avoid by using free sunlight.

Global food production must increase roughly 50% by 2050 to feed a projected 9.7 billion people, while simultaneously using less land and water as climate change disrupts traditional growing regions. Indoor farming offers year-round production, 95% less water use, no pesticides, and proximity to urban consumers. The market was valued at $5.6 billion in 2023 and projected to reach $13 billion by 2028. But without solving the energy problem, indoor farming remains limited to premium products in wealthy markets — exactly the populations that need it least. Climate adaptation requires indoor growing to work for staple crops in food-insecure regions, where energy costs are the binding constraint.

Most vertical farms use LED lighting tuned to red and blue wavelengths that plants absorb most efficiently. Even with optimized LEDs, the electricity-to-photosynthesis pathway is roughly 2–3% efficient (wall plug to biomass), compared to the effectively zero marginal cost of sunlight. AeroFarms invested heavily in proprietary LED systems and aeroponic growing methods but still couldn't make the economics work — energy comprised 25–30% of operating costs. AppHarvest used conventional greenhouse designs with supplemental lighting in Kentucky (cheaper energy, more sunlight), but rising energy prices in 2022 destroyed margins. Some companies tried hybrid approaches (greenhouses with supplemental LED), but the capital cost of glass structures plus the energy cost of supplemental lighting exceeded the savings. Others focused on high-value crops (microgreens, saffron, strawberries) to improve margins, but this limits the market to luxury segments. Attempts to use renewable energy (on-site solar) face a fundamental irony: the solar energy hitting the roof of a vertical farm would grow more food if it simply fell on field crops below.

The core breakthrough needed is either: (1) a dramatic improvement in the efficiency of converting electricity to plant-usable photons — current LEDs convert about 50–60% of electricity to photosynthetically active radiation (PAR), with a theoretical ceiling around 70–80%; (2) biological approaches that reduce the amount of light plants need, such as engineered crops with enhanced photosynthetic efficiency or light-harvesting modifications; (3) passive or low-energy light delivery systems that capture and redirect natural sunlight deep into indoor growing structures (fiber-optic daylighting, luminescent solar concentrators, light pipes); or (4) radical reduction in lighting duration through circadian optimization or pulsed-light growing protocols that achieve equivalent biomass with less total energy input. Adjacent fields: semiconductor photonics (LED efficiency), synthetic biology (photosynthesis optimization), solar concentrator design (light capture and delivery).

A student team could: (1) prototype a fiber-optic or light-pipe daylighting system that delivers sunlight to an interior growing shelf and measure the yield-per-energy-input compared to LED-only growing; (2) conduct a systematic comparison of pulsed-light growing protocols (varying pulse frequency, duration, and intensity) against continuous lighting for a standard crop like lettuce, quantifying energy savings vs. yield impact; (3) design and model a hybrid growing system that optimizes the tradeoff between natural light penetration and stacking density in a vertical structure, identifying the energy-break-even geometry. Relevant disciplines include agricultural engineering, optics/photonics, mechanical engineering, plant biology, and energy systems.