Urban agriculture: Another Win-Win for China?



Report from China: Robert Ayres

In my last post I explained why (private) investment the automobile industry was a huge win-win for the US in the early years of the 20th century, for reasons that do not apply to 21st century China. In fact, there are strong arguments that the overall impact of still more cars (and highways) in China will be more nearly a lose-lose proposition, the only winners being the foreign auto manufacturers.

However, I think there is another investment opportunity, still in its infancy, that – if pursued intelligently – can be a true “win-win”.

In brief, it is urban agriculture integrated with high-rise residential structures, which (for lack of a better term) I call Vertical Villages. They would utilize programmable LED luminaires, need to be linked to municipal water and electricity supplies, but sewage treatment and composting (with biogas recovery) can be taken care of within each cluster. The vertical towers should produce all of the green vegetables, root crops, berries, poultry and fish consumed within each cluster. Tree crops (fruits and nuts) and vines, requiring pollination, can be grown outdoors, where they can be integrated into recreational parks. Sewage from the cluster should be recycled in the cluster to recover plant nutrients and (‘gray’) water for irrigation. Seed crops (grain) and large animals will still be produced on more conventional farms (at least for the present), but some of the land formerly occupied by houses and roads can be reclaimed for agriculture.

Progress in lighting technology is one of the drivers of (so-called) vertical farming. Supplementary lighting has been used in large greenhouses, for many years. The  standard light source has been high pressure sodium vapor (HPS) lights, which are about 30% efficient in terms of converting electric power to (white) light. However, a new light source appeared in the last years of the twentieth century, viz. light-emitting diodes (LED), which are typically over 50% efficient, sharply cutting the heat output. But that is not the whole story. The diodes can be adjusted to produce light in specific wavelengths. It turns out that the absorbtion spectrum of chlorophyll is maximum for light in the red and blue colors, while yellow light is not absorbed and does not contribute to a plant’s photosynthesis. The LED’s producing red and blue light are cooler than LED’s producing white light. This means that they can be safely placed closer to the leaves than HPS light fixtures. That results in an overall gain of 400% for LEDs as compared to HPS lighting. In other words, the cost of LED light for vertical farming is now only 25% of what it would have been in a conventional greenhouse.

While local renewable energy sources (solar and wind) cannot provide for all human needs at all times, they may generate surplus power at times. This makes it difficult to integrate wind and solar farms into power grids, which may require significant “base load” capacity (coal-fired, hydro-electric or nuclear). However the artificial light needed for plants need not be supplied at times when the sun is shining or the wind is blowing. It can be supplied at night, for instance, when other demands are low. This may require pumped storage to match demand with supply. Surplus power can be stored efficiently by pumping water from lower to higher levels in the structures, provided there is sufficient storage capacity at the top. A fully integrated electric power system for a cluster would feed power to the plant lights only when it is not required for other purposes (such as pumps, washing machines, dryers, and elevators), keeping overall demand fairly constant.

From a macro-economic viewpoint, there are several notable advantages of a city consisting of a group of “neighborhoods” linked to each other by an electrified rail network (like Paris) and also linked to suburban villages, also by rail, like spokes on a wheel. Moreover, the outlying villages could be linked to each other, like beads on a necklace, leaving more “green space” between them than existing sub-urban settlements depending exclusively or largely on roads. One of the major advantages of this scheme, especially for a densely populated country like China, is reduced land (and exergy) requirements for transportation, releasing urban land for recreational and other purposes. Moreover, food produced locally is fresher and tastier than food produced far away.

Vertical farming in cities

china-ayres-skyscraper-farming-feb17Vertical farming with LED lighting, an idea getting attention from urban planners nowadays, was regarded as very futuristic only a few years ago. Curiously, one of the drivers behind the recent wave of vertical farm startups is the market for “home grown” cannabis. This created a market for the specialized LED lighting fixtures that are now the core of vertical farming technology. It was partially legalized a few years ago, thanks to some election results in the western US. Before legalization, cannabis was so valuable that the use of costly LED lighting was not an obstacle. But, as often happens in technology, once the market for red and blue LED lights was created, other uses soon followed and costs dropped dramatically.

The vertical farm for salad greens is a natural extension of the aero-farm invented (and named) by Ed Harwood, a Cornell University Associate Prof. of agronomy. His first “mini-(aero) farm” still operates and provides salad greens 6 or 7 times a year for the kitchen of Philips Academy Charter School, in Newark, the first buyer (2010). More recently, Harwood has joined forces with a pair of “green” venture capitalists named Ed Rosenberg, and Marc Oshima, who raised the money. Their venture Aero Farms, now has an entirely enclosed farm in an old steel warehouse in Newark N.J.(Frazier 2017)  The startup has 100 employees producing and shipping 1000 tons a year of baby salad greens (which sell for around $8 per pound). Aero-farms  uses aqua-ponic technology,[1] and lighting is from (mainly) blue and red LEDs. No natural sunlight is involved. City air (with enhanced CO2 content from tanks), city water, and city electricity are the main inputs, along with small amounts of fertilizer. The water plus nutrient mixture is sprayed from below onto the roots of the seedlings, which are held in a patented “growth medium” (actually a fuzzy cloth made from recycled plastic bottles.) The light is provided by LEDs, emitting in two parts of the spectrum — cool reds and blues – arranged in stacks. The cloth is washed after each crop. No pesticides are used.

Another large vertical farm, Green Sense Farms, was founded in 2014 by Robert Colangelo in Portage Indiana (near Chicago) in a partnership with Philips Lighting. It is based on hydroponics, uses 8000 4 ft linear LED fixtures for light and a growing medium from cocoanut husks (Wright 2016). It sells 4000 cases per week of fresh baby salad greens and herbs (basil) to customers in Chicago. Green Sense Farms has already cloned itself in China, where it uses 3500 8 ft. LED fixtures. A third plant is expected to open soon in South Bend Indiana.

The vertical farm has recently been miniaturized. One firm, called Local Roots, was founded in 2013 in Los Angeles exemplifies this idea. According to its website it “designs, builds, deploys and operates productive indoor farming solutions” around the world. It mainly promotes hydroponics as an answer to California’s continuing drought (it claims 97% less water use than conventional irrigated farms). But the signature product of the firm is a “farm” in a packing case, using LEDs, that produces baby salad greens equivalent to the production of a 5-acre field.  The first crops coming from the shipping containers may be baby salad greens, but they will be followed soon by other greens like kale and spinach, then  tomatoes, strawberries, blueberries, maybe even carrots and beets. Just wait a bit.

A more recent ‘start-up’ (2016) called Square Roots Grow (founded by Elon Musk’s younger brother Kimball) is located on a Brooklyn parking lot. It advertises self-contained farm-in-a-shipping container, that can be operated (for instance) in an institutional kitchen or a local farmers market. It requires electric power – comparable to a refrigerator — and some water, but much less water than a conventional greenhouse. SRG advertises an 80% reduction in water use. The farm in a shipping container uses no natural light, but depends entirely on artificial light provided by low power red and blue LEDs. Incidentally, the area inside the shipping containers (320 square feet, is said to be equivalent to two acres (87,120 square feet) of horizontal ground. That is a ratio of slightly over 27:1. More to the point, young Musk’s company (Square Roots Grow) is prepared to front the capital cost for commercial buyers and take a share of the profit. They must be expecting profits.

In the same year that Ed Harwood sold his mini-farm to the Philips Academy, Dickson Despommier, a Columbia University professor of parasitology and environmental science, wrote a widely circulated book called “The Vertical Farm: Feeding the World in the 21st Century”. Despommier’s concept is more like turning a horizontal “greenhouse” on its end, basically to minimize agricultural land use and allow for more recycling of the water and nutrients, especially nitrates and phosphates.

In conventional agriculture, those nutrients end up in surface runoff or sewage, and cause serious pollution problems in rivers and estuaries. In a well-designed vertical farm, or better yet, a vertical village, the nutrients are not lost. They can be cycled through fish-ponds and recycled back to the plants. This would not only reduce the need for energy-intensive synthetic ammonia (the chemical from which all nitrates are made) but more important, it would sharply reduce the loss of phosphates, which are non-substitutable and irreplaceable.

At the time Despommier wrote his book (2010), there were no vertical farms. By March 2015 there were at least 12 in operation or under construction, just in the US. By the end of 2016 that number had tripled, according to one source. operating vertical farms in half a dozen US cities, several of which I have mentioned above, not to mention several foreign countries including China, Japan, Korea, The Netherlands, and Singapore.

If you go to “Vertical Farming” in Wikipedia (as I have), you will encounter surprisingly harsh comments, mainly from publications that reviewed Despommier’s book. The Economist published an article entitled “Vertical Farming—Does it really stack up?”(Dec. 9, 2010) mentioned all sorts of problems, especially energy, and arrived at predictably negative conclusions. To name another, an environmental journalist George Monbiot, wrote an article entitled “Towering Lunacy” for The Guardian. In it he quoted a supposedly expert source (a film-maker named John Russell), to the effect that the artificial light needed to grow 500 grams of wheat in a loaf of bread would cost £ 9.82 (that was in 2010) whereas the current farm-gate price for that amount of wheat was 6p. That is a cost ratio of 163:1 (I can still use my old slide-rule), which certainly suggests that vertical farming must be “magical thinking” or “towering lunacy” (Monbiot’s words). The Wiki article is obsolete and needs to be revised.

It is true, as Monbiot notes sarcastically, the price of wheat on the market does not include any cost for solar energy – the sunshine is free. What his calculation definitely fails to account for is that a wheat crop uses a lot of land and takes half a year (or more) to produce, depending also on chemical fertilizers (of which over half is lost). It also depends on “free” rainfall and some physical work for planting and harvest by large machines powered by diesel engines and producing carbon dioxide and other emissions. In contrast, the carbohydrates produced in the closed SRG shipping container, or other vertical systems, use a lot less water, and a lot less space and time, at the price of some electricity. (Hydroponic or aquaponic agriculture can yield many crops a year, depending on what is being grown.)

The problem with Monbiot’s analysis (and with journalists commenting on science they don’t understand), is that the number of photons of light actually needed for photosynthesis is exactly the same, whether inside a box, or in open air.  However most of the energy in direct sunlight impinging on green leaves out-doors is wasted because it is yellow, the wrong wavelength to interact with chlorophyll. (That’s why we see the green color, which is reflected light not being absorbed.) Most of the yellow sun-light impinging on a field of wheat just heats (and dries) the soil and evaporates water from the leaves. That evaporated water then has to be replaced by rain or by irrigation.

But by producing artificial light in the box at wavelengths corresponding to the plant’s actual needs (red and blue), the number of photons that interact with the chlorophyll inside the box is far lower than the number of solar photons needed outside. Inside the box, with humidity control and mirrors on the walls, most of the artificial light will actually be captured and enable the plant to produce carbohydrates. Moreover, the rate of photosynthesis can be enhanced – as Aero-farms does — by increasing the CO2 level from 400 parts per million (PPM) to 1000 ppm.

So how did Monbiot, and his film-maker friend, come up with their crazy cost ratio of 163:1? I don’t know exactly what silly mistake they made – I don’t care – but their back-of-the-envelope calculation is totally misleading and just plain wrong. The vertical agriculture technology has a long way to go, for sure, but it is not magical thinking. It has all the features of a major technological breakthrough.


One more “win”

Actually, the additional electric power needed may turn out to be a “freebie”, in some locations. This is because large solar parks or wind farms – of which there are many in China and more coming — tend to produce more power than is needed by the grid, when the wind is actually blowing or the sun is shining brightly in the middle of the day. At present there is no good use for this temporary surplus. Of course, the grid itself can smooth thing out to some degree. But, unfortunately, some of those remote solar parks and wind farms have to shut down during peak output periods. This reduces their “capacity factor” – the ratio of power actually produced as compared to the potential if the sun shone or the wind blew constantly — or as compared to nuclear or coal burning power-plants. This low capacity factor is the major criticism against them. (Hence, there seems to be a large potential future market for efficient new power storage systems, such as Tesla is now offering.)

But the most efficient existing power storage system is “pumped storage.” In times of power surplus, water is pumped uphill to reservoirs. When the power is needed, it simply flows back down through hydraulic turbo-generators. It would be relatively easy to duplicate this pumped storage capability in new high-rise buildings by incorporating reservoirs at the top. Those reservoirs might also be open to the air, thus providing evaporative cooling in hot days and thermal insulation on cold days. (They might even be adapted for fish-farming.)

All of the above suggests that vertical aquaponic or hydroponic farms could profitably be integrated into new high-rise housing, especially in densely populated countries (like China and India) where urban land is scarce and valuable and where fresh produce is particularly rare. The land-saving aspect is attractive in itself (recall the 27:1 ratio mentioned above). But the fact, that tall buildings might become much more nearly self-sufficient in food, is a further “win” because it allows the food consumed to be fresh and thus reduces the need for horizontal transportation. (Fresh vegetables shipped from California to New York must be harvested early and require days in a truck to cross the country.) Vertical transportation in buildings by electric elevators, or local delivery by any means is far more efficient than long-distance horizontal transportation by any other means.

Why might vertical farms be a “win-win” for China, especially? The simple answer is that throughout China there are literally thousands of clusters of partly built steel structures that were intended for housing, but that have been abandoned when the housing “bubble” burst several years ago. Yet those half-built structures could be revived as “vertical villages”, to re-house rural populations still living on the land – thus releasing land for other purposes ranging from recreation to orchards and even for grazing by cattle and sheep. The third “win” results from incorporating reservoirs at the top for pumped storage of surplus power from large solar parks and wind farms that have already been built, thus increasing their capacity fraction and profitability.



Frazier, Ian. 2017. “The Vertical Farm.” The New Yorker, January 9.


Wright, Maury. 2016. “Science advances in matching LED lighting to horticultural needs.” LED Magazine, Sept. 20.


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About the author

Robert U. Ayres is a physicist and economist, currently Novartis professor emeritus of economics, political Robert Ayres Inseadscience and technology management at INSEAD.. He is also Institute Scholar at the International Institute for Applied Systems Analysis (IIASA) in Austria, and a King’s Professor in Sweden.   He has previously taught at Carnegie-Mellon University, and as a visiting Professor at Chalmers Institute of Technology. He is noted for his work on technological forecasting, life cycle assessment, mass-balance accounting, energy efficiency and the role of thermodynamics in economic growth. He originated the concept of “industrial metabolism”, known today asindustrial ecology” with its own journal. He has conducted pioneering studies of materials/energy flows in the global economy. Ayres is author or co-author of 21 books and more than 200 journal articles and book chapters.  The most recent books are Energy, Complexity and Wealth Maximization (Springer, 2016), The Bubble Economy (MIT Press, 2014)  “Crossing the Energy Divide” with Edward Ayres (Wharton Press, 2010) and The Economic Growth Engine with Benjamin Warr (Edward Elgar, 2009).












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[1] Plants can be grown in water (hydroponics), using 70% less water than conventional agriculture on land, or in air (aquaponics), using 70% less water than hydroponics. In aquaponics, water and nutrients are sprayed onto the roots from below.


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