by Martin J. Milita, Esq.
The New Jersey Cannabis Regulatory Commission (“CRC”) has adopted regulations relating to environmental impact and sustainability of the cannabis industry. These regulations will be in effect for up to one year and will empower the CRC to begin licensing cannabis businesses.
Environmental Impact and Sustainability Plans
To operate a cannabis business in New Jersey, businesses need to obtain one of the coveted licenses through the competitive licensing process. As part of the process, prospective cannabis businesses must prepare and submit an environmental impact plan. The environmental impact plan is evaluated and scored and will certainly impact whether an applicant receives one of the licenses.
Before the new regulations, there was very little information about the proper components of an environmental impact plan for cannabis businesses in New Jersey. Fortunately, the new regulations provide some guidance regarding the appropriate elements of an environmental impact plan. However, the environmental impact plan requirements for a temporary license differ from those relating to standard licenses:
- Temporary license — Applicants seeking a temporary cannabis license are only directed to submit “an environmental impact plan, which includes consideration of sustainable alternatives to single-use plastic packaging.”
- Standard license — Applicants seeking a standard license are directed to submit “an environmental impact plan, which shall, at a minimum, include consideration of sustainable alternatives to single-use plastic packaging, efforts to minimize water usage, and any other factor required by the [CRC] . . . .”
The focus on single-use plastic packaging is consistent with New Jersey’s overall goal of reducing plastic waste.
The new regulations also require cannabis businesses to create and implement environmental sustainability plans as a condition of receiving a license, that may include, but are not limited to:
- A waste reduction plan;
- A water usage reduction plan;
- Biodynamic farming;
- A sustainable packaging plan that reduces or eliminates the use of single-use plastics and promotes the use of recyclable or green packaging; or
- A plan to use some amount of renewable energy to power its operations.
However, these provisions omit many relevant considerations, such as air emissions, climate change, and environmental justice. Given the anticipated competitiveness of the cannabis application process, prospective applicants should be as comprehensive as possible in addressing environmental impacts.
To better understand environmental impacts and concerns, cannabis license applicants should refer to the National Cannabis Industry Association (NCIA) report of October 2020 titled Environmental Sustainability in the Cannabis Industry: Impacts Best Management Practices and Policy Considerations.
Manifestly, cannabis businesses looking to operate in New Jersey should focus on environmental considerations early in the planning process, bringing together architects, engineers, and environmental professionals to identify and minimize environmental impacts.
One of the most important environmental impacts is cannabis waste disposal. According to the NCIA, “The environmental impact from the volume of cannabis byproducts currently estimated to be landfilled is equivalent to the emissions from more than 6,000 passenger vehicles or more per year.”
While the New Jersey Department of Health prescribed certain disposal and composting practices, and specifically allowed certain marijuana waste to be composted the new regulations do not provide any additional information on acceptable cannabis waste disposal or recycling practices. Consequently, it is unclear whether the prior policies will remain in place, or whether the CRC will issue further guidelines regarding the disposal of cannabis waste.
Hopefully, moving forward the CRC will embrace more environmentally friendly regulatory alternatives, including increasing the types of wastes that can be composted and eliminating or reducing the requirement to mix cannabis refuse with other wastes.
Applicants and existing businesses alike should consult with appropriate professionals to understand and minimize environmental impacts — especially prospective businesses that will be participating in the competitive licensing process. While many see lucrative business opportunities on the horizon, few entrepreneurs are aware of the environmental impacts. Left unconsidered, these impacts can impede an applicant’s ability to obtain a cannabis license in New Jersey. Our professionals continue to follow these issues closely, and businesses should prepare to address environmental impacts early in the business development process.