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Solar Cannabis Dispensary Calculator

Enter your dispensary's square footage, security load, HVAC, and state — get solar sizing, ITC savings, Section 280E tax impact, and PPA vs. cash purchase comparison.

Dispensary details
sq ft
cameras
tons
hrs/day
$/mo
Solar system for your dispensary
27.5 kW system (69 × 400W panels) — 22% energy offset
Estimated monthly electricity use10,088 kWh/mo
Load breakdown: Security (24/7) 720 kWh | HVAC 6,048 kWh | Vault refrig 800 kWh | Lighting 2,520 kWh
Annual solar production44,968 kWh/yr
Annual electricity savings$11,692/yr
Gross system cost$77,000
Cash Purchase (Section 280E impact)
Federal ITC (30%)-$23,100MACRS depreciation tax savings$0 (blocked by §280E)First-year tax benefit-$23,100Effective cost after ITC$53,900Payback period4.6 yrs25-year NPV$102,509
PPA Option (recommended for dispensaries — no §280E limitation)
Upfront cost$0Annual savings (82% of gross)$9,587/yr25-year estimated value$172,569MACRS benefit captured byPPA provider (not you)
Annual CO2 reduction8.7 tons/yr
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How to Use This Calculator

Enter storefront size and security camera count

This calculator is for retail cannabis dispensaries — distinct from cultivation facilities (grow operations have 10-100× higher electricity loads). Enter your retail storefront square footage (800-5,000 sq ft is typical) and security camera count. Security is the unique high-load differentiator for dispensaries: state regulations typically mandate HD cameras covering every area where cannabis is handled, with 90-day minimum video retention. High-definition cameras with NVR recording storage run 24/7 at ~25W each — a 60-camera system draws 1.5 kW continuously, 24 hours per day, 365 days per year.

Understand Section 280E before choosing cash vs. PPA

Section 280E of the Internal Revenue Code is the most important tax consideration for cannabis solar. Federal law treats cannabis as a Schedule I controlled substance, disallowing business deductions for trafficking-related expenses. MACRS depreciation — the primary tax benefit that makes commercial solar so attractive — is blocked for cannabis companies under 280E. The ITC credit (30%) is still available. But a standard business getting both ITC and MACRS saves 40-55% of system cost in year one; a cannabis business gets only the ITC (30%), keeping 70% of the system cost as effective spend. This is why PPA structures, where a third-party owner claims the tax benefits, often outperform cash purchases for dispensaries.

Select your state carefully

Only states with legal adult-use or medical cannabis programs are listed. Electricity rates and solar production vary significantly — California at $0.26/kWh with 5.6 PSH vs. Washington at $0.10/kWh with 3.6 PSH creates dramatically different solar economics. High-rate states with good sun (California, Massachusetts, New York) have the strongest solar ROI for dispensaries regardless of financing structure.

The Formula

Load Estimate (monthly kWh): Security (24/7): cameras × 25W × 24 hrs × 30 days HVAC: tons × 1.2 kW/ton × operating hrs × 30 Vault refrigeration: 800 kWh/mo (if present) Lighting: sq ft × 0.003 kWh/sq ft/hr × hours × 30 Roof Area ≈ Store sq ft × 1.1 Max System kW = Roof Area ÷ 80 sq ft/kW System kW = min(kW for full bill offset, Max kW) Annual kWh Generated = System kW × PSH × 365 × 0.80 Annual Savings = Annual Bill × Offset % CASH PURCHASE (§280E applies): ITC = Gross Cost × 30% MACRS tax savings = $0 (blocked by §280E) Effective Cost = Gross Cost − ITC only Payback = Effective Cost ÷ Annual Savings PPA OPTION: Upfront = $0 Annual savings = Gross savings × 82% PPA owner claims ITC + MACRS

The PPA recommendation is specific to cannabis dispensaries. For most other commercial businesses, cash purchase maximizes ROI. For dispensaries blocked from MACRS by 280E, the PPA provider captures the full tax benefit package (ITC + MACRS) and passes roughly 82% of gross electricity savings to the tenant through a below-retail per-kWh rate.

Example

GreenLeaf Dispensary — 2,000 sq ft, multi-location chain, California

A multi-location cannabis chain evaluating solar for their 2,000 sq ft California dispensary. 40 security cameras, 12 tons HVAC, vault refrigeration, 14 operating hours, $4,500/month electricity bill.

Store size2,000 sq ft
Security cameras40 cameras (24/7, ~1.0 kW)
HVAC12 tons
StateCalifornia (5.6 PSH, $0.26/kWh)
Monthly bill$4,500/mo ($54,000/yr)

Cash Purchase (§280E impact)

System size~20 kW (50 panels)
Annual savings~$23,000/yr
Gross cost$56,000
ITC (30%)-$16,800
MACRS savings$0 (blocked by §280E)
Effective cost$39,200
Payback~1.7 years

PPA Option

Upfront cost$0
Annual savings (82%)~$18,900/yr
25-year value~$340,000

California's high rate makes cash purchase compelling even with 280E limitations — 1.7-year payback is excellent. In lower-rate states, the PPA may provide better value. Always consult a cannabis-specialized CPA before deciding on financing structure.

FAQ

Yes — the federal Investment Tax Credit (ITC) is available to cannabis businesses that pay federal income tax. The ITC is a tax credit against taxes owed, not a deduction — it survives Section 280E. However, MACRS depreciation is a tax deduction that 280E disallows for cannabis companies. The practical result: dispensaries get 30% ITC but lose 10-25% in MACRS depreciation benefits that other businesses enjoy. Always work with a CPA specializing in cannabis tax to confirm your specific situation.
In a PPA, a third-party company owns the solar system, claims the ITC and MACRS depreciation, and sells power to the dispensary at a below-retail rate. The third party is not a cannabis company, so they can claim the full tax benefit package. They pass the economics to you through a discounted per-kWh rate — typically saving dispensaries 82-88% of what a cash purchase would save. For a dispensary losing the MACRS benefit under 280E, the PPA provider captures value the dispensary couldn't access anyway, then shares most of it. Net result: PPA often outperforms cash for dispensaries despite the opposite being true for most businesses.
State regulations mandate minimum coverage: typically all areas where cannabis is received, stored, or sold must have continuous HD video. A 1,000 sq ft dispensary needs 20-30 cameras; a 5,000 sq ft operation needs 60-100. Each HD camera draws 15-25W; NVR servers add 200-500W. Total: 1-3 kW for security continuously — 720-2,160 kWh/month just for cameras and recording. This is 10-20% of a small dispensary's electricity bill from security alone. Solar's 24/7 availability via net metering means daytime generation credits offset nighttime security system draws.
Yes, with the right structure. Dispensaries operating cash-heavy due to federal banking restrictions benefit from reducing operating expenses predictably. Solar eliminates or reduces one of the largest monthly utility bills. A PPA requires zero cash upfront — the provider finances everything. Monthly PPA payments are lower than current electricity bills from day one. With utility rates rising 3-5% annually and PPA rates fixed, the savings gap widens each year. Many PPA providers now specifically target cannabis retail given the favorable market dynamics.
The difference is enormous. A cannabis cultivation facility (grow) uses 200-2,000+ kW of electricity — primarily for high-intensity lighting (1,000W HPS or LED grow lights running 12-18 hours/day), HVAC, dehumidification, and CO2 enrichment. Solar can offset 10-30% of cultivation facility loads at best. A retail dispensary uses 15-50 kW — security, HVAC, lighting, and refrigeration. Solar can offset 60-100% of dispensary loads. This calculator is for retail dispensaries only. Use the Solar Cannabis Grow Calculator for cultivation facilities.

Related Calculators

🌿 Solar Cannabis Grow Calculator
Size solar for cannabis cultivation facilities — grow lights, HVAC, and dehumidification.
📄 Solar MACRS Depreciation Calculator
Understand MACRS depreciation and how §280E affects your solar tax benefits.
💲 Solar PPA Calculator
Compare PPA vs. cash vs. loan — see which financing structure fits your situation.
📌 Solar Tax Credit Calculator
Calculate your exact federal ITC for commercial solar systems.

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