The Challenges of Indoor Farming

Oct 20, 2016 | Sustainable Agriculture | 0 comments

The Dirt:
There are many benefits to indoor farming including reducing environmental stress, economic prosperity, and the creation of a system that can provide local produce year round. With all these benefits, we were curious why more growing hasn’t moved indoors? What are the challenges behind this new type of farming? And are solutions being found to make it easier – more feasible? Here is what we found.

Dirt-to-Dinner welcomes contributing writers Samantha (Sam) Duda, Susan Leaman, and Diane Wetherington who have extensive experience and knowledge in the food industry. Susan works with companies and associations to develop solutions that address produce-related food safety issues; and Diane is CEO of iDecisionSciences, LLC, a provider of specialty crop consulting services, and iFoodDecisionSciences, Inc., a software solutions provider for the food industry. After completing a degree in sustainability and business administration, Sam joined iDecisionSciences, LLC, this year as a research and analytics associate.

In our previous article, “Meet the ‘Ponics,” we discussed how innovative farming techniques include growing on rooftops and inside greenhouses, shipping containers, and warehouses. But, in order to understand the big picture, we also need to examine the various challenges that are associated with this type of farming.

The Startup Cost

The first challenge for any company wanting to start an indoor farm is the startup costs. For companies looking to take part in indoor farming, there are hefty capital expenditures such as real estate and equipment as well as ongoing high operating costs. According to Bright AgroTech, LLC, to start just a 1,800 square foot indoor farm would cost around $460,000. Approximately one-third, or $160,000 of that money is for start-up cash flow to initially pay for expenses like the electric bill, marketing, and loan payments before revenue starts coming in. Equipment for a vertical tower growing system is around $260,000 plus the cost of a 20 ton cooling HVAC system necessary for controlling heat from the lighting system. If using a pre-existing building, remodeling costs to accommodate indoor growing includes a unique plumbing system and a three-phase high-voltage electrical system at a cost of about $20,000. 

For companies that are growing indoors on a large scale, startup costs are in the millions. Some of the biggest players already established in indoor growing received millions of dollars from big name investors before beginning their endeavors. 

Before breaking ground on their first indoor facility, Gotham Greens, which operates four urban rooftop greenhouse farms in New York City and Chicago, raised over $30 million from numerous private investors. In order to convert a former steel mill in Newark, New Jersey, to a 70,000 square foot vertical indoor farm, AeroFarms raised over $70 million ‒ mostly from private investors with the help of Goldman Sachs and Prudential. As indoor farming practices and technologies become more established in the future, the industry hopes for lower startup costs and more interested investors.

The Complexity of Lighting

One of the more prominent reasons the indoor farming industry has expanded in the last several years is due to the falling price of light emitting diode (LED) lights. LED lighting provides the same amount of lighting as fluorescent light but requires half the amount of energy. In July 2015, the lighting company, Phillips, opened a research facility, GrowWise Center in the Netherlands, to study the interaction between crops and the light spectrum. Horticultural lighting is complex. Plants react uniquely to different spectrums of light and color at different points in their growing cycle. There is ongoing extensive research and data collection to make indoor farming economically viable and energy efficient.

Vertical Farming. image credit: Aerofarms

GE Mirai Lettuce Farm. Source:

Research has demonstrated that LED lights with blue and red diodes burn cooler, making them more energy efficient. These lights produce a pinkish/purplish array of the light spectrum where most crops grow best. However, despite LED being energy efficient compared to other lighting sources, LED lights still may not be the most efficient way to mimic natural sunlight. Erico Mattos, an urban agriculture advocate, reports that plants can waste up to 80% of the energy that is provided to them due to each crop having a different threshold for optimizing photosynthesis. For example, a sweet potato plant needs only 64% of the light energy produced by a LED light for optimal photosynthesis. If light output is not adjustable, sweet potatoes grown in an indoor growing environment waste 36% of the provided light energy – light paid for and not used. In conventional outdoor or greenhouse farming with the benefit of free sunlight, this waste of light energy by the plants does not impact a farmer’s costs.

For indoor growers, unused light represents a real economic and environmental challenge. To address this challenge, Mattos has created a technology called PhytoSynthetix that allows plants to communicate how much light they need by triggering the lights to dim. The technology uses sensors to detect chlorophyll fluorescence measurements that ‘communicate’ to the LED lights to adjust accordingly.  This sensor-triggered technology reduces energy consumption, but has yet to be applied on a large scale. As technological advances become cheaper, the research and data collected from programs like GrowWise and PhytoSynthetix can help indoor farmers lower their energy cost and grow crops more efficiently. 

The Limited Crop Range

Examples of greens suitable for indoor farming

Unlike conventional farming, indoor growing has a limited crop range. Robert Colangelo, CEO of Green Sense Farms, said, “You could pretty much grow anything in an indoor vertical farm. But there’s only a few things you can grow commercially and economically viable today.” Green Sense Farms grows leafy greens in their vertical warehouse farm in Portage, Indiana using horizontal growing racks. Colangelo believes that farming in the future will be different for different commodities. Indoor vertical farming may be the future for leafy greens, but tomatoes, peppers, and cucumbers are best grown in greenhouses, and commodity crops like soybeans, corn, and wheat are best grown on field farms. Thus, indoor farming plays a specific role in the future of farming, but will not account for all growing operations.

Furthermore, each indoor farm, greenhouse, or warehouse, is engineered for a specific crop including the lighting, climate, nutrition, irrigation, software, and sensors for that particular growing environment. The cost of doing a massive reengineering or remodel of a building and its infrastructure to accommodate a new crop is currently not economically sound for a grower who wants to expand or change an existing operation into different crops (i.e., switch from leafy greens to strawberries). 

Food Safety

Many have the false perception that due to the controlled environment of indoor farming, the need for food safety is eliminated. David Rosenberg, CEO of AeroFarms, worries that people unfamiliar with indoor growing may under-appreciate the risks associated with growing crops indoors. Nate Storey, the CEO of Bright AgroTech says, “If you’re growing indoors and growing plants, biology is messy and invites disease; you will have pathogens, you will have disease organisms, you will have insects and pest, these things are inevitable.” Fungal disease and mildew are common in indoor growing environments, especially in horizontal plane vertical warehouse farming. 

The key to reducing plant disease and pests is AIRFLOW.

In an indoor growing environment, humidity is naturally produced from plants transpiring and irrigation water evaporating in combination with heat produced by the LED lights. Humidity creates a favorable environment for human and plant pathogen growth. Airflow systems pump CO2 in for plant respiration and remove excess humidity. Effective airflow is difficult in horizontal plane vertical farming due to the limited space between the crop’s canopy and lighting fixtures. This lack of space for adequate airflow results in a higher risk of foodborne pathogens as well as higher energy cost to aggressively pump more CO2 and air through the growing chambers. Add to this the fact that most indoor environments are kept exceptionally clean – almost sterile – creating an environment with few competitive microorganisms if pathogens are introduced. Pathogens in this type of environment with little competition for available nutrients are able to grow more rapidly and unchecked.

Diagram of Horizontal Plane Vertical Farming vs. Vertical Plane Vertical Farming
(source: Bright Agrotech)

Airflow in Horizontal Plane Vertical Farming vs. Vertical Plane Vertical Farming
(source: Bright Agrotech)

Additionally, this type of indoor growing limits visual access for workers, making it difficult for them to check crops for infections or contamination. For workers to visually inspect what is happening between and inside each rack, they must use expensive scissor lifts and reach into the growing bed to look for disease or pest. This process is time consuming and reaching over plants also presents a food safety hazard. Nate Storey uses vertical planes instead of horizontal planes for his indoor farm allowing for better airflow, lower heat production, and easier access for workers. This shift from horizontal to vertical planes with better airflow also improves food safety while lowering energy consumption and labor costs. 


Some indoor farmers believe that their greatest challenge is finding labor with the necessary skills and educational background to monitor the crops at all hours. Indoor farming companies are looking for candidates that have both a deep understanding of plant biology and data manipulation. Even though indoor growing is not a new concept, recent operations are on a much larger scale than previous operations, and it is sometimes difficult to find enough people with relevant knowledge and experience. David Rosenberg (AeroFarms) says, “While hiring is a challenge, ensuring the right people are running indoor ag businesses is also of utmost importance as the industry scales.” The labor force of an indoor farm operation must oversee the massive amount of crops without cutting corners on food safety. That’s why Matt Matros of FarmedHere predicts his business and others, like AeroFarms and Green Sense Farms, “will go the way of Amazon, which uses factory robots to attend to packages” in its massive warehouses.

The Bottom Line:

The indoor farming industry undoubtedly has benefits, but it is not without its challenges. With the rapid advancement of technology and new research focused on improving indoor crop production, indoor farming can become more affordable, overcome hefty electric bills, improve food safety, expand crop range, and increase peoples’ knowledge of the industry. Keep your eyes on indoor farming: despite its challenges, this industry is on the up.


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