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Electricity is another significant operating expense, particularly during the months of October through March. The model assumes the greenhouse will require 62kW of electric power, primarily for lighting, 16 hours per day. The greenhouse is laid out with 48x 1,000 Watt lights installed for an optimal production area of 4,300ft2. The total electricity costs are approximately $30,200 per year assuming a price of 10¢/kWh. This electric rate would be a wholesale value, and significantly less than the 10 to 14¢/kWh rate that the operation would pay if purchasing power directly from GVEA, the utility company in and around Fairbanks (GVEA 07). Marketing and bags to seal the lettuce for sale would be an additional expense of $0.25 per head, or $37,000 per year. Assuming a local market for the lettuce, the model does not include transportation costs. Dimensions 60ft x 72ft Revenue Lettuces per Year* Price$/Lettuce Total$ 148,107 3.00 444,322 Costs Unit Quantity Price Value Total$ Pre-harvest & harvest Material Inputs Accessories Labor (2 people full time) Heat Electricity Int. on Op. Capital** Total Pre-harvest Variable Cost (21) $ (22) $ (23) hours (24) $ (25) $ (26) $ 4160 225,834 30 0.05 45,243 1,978 124,800 23,625 30,188 11,292 237,126 Packing & Marketing Custom Packing & Marketing (30) heads 148,107 0.25 37,027 Total Packaging & Marketing Cost 37,027 274,153 Total Variable Cost Fixed Cost Total Cost Depreciation & Intrest Ins. Total Fixed (31) $ (32) $ 1 21,733 1 1,681 21,733 1,681 23,414 297,567 Returns Above Cash Cost Returns Above Total Costs Breakeaven Price to cover cash costs Breakeaven Price to cover total costs 170,169 146,755 $1.85 $2.01 * production losses 5% ** Interst on operating expences charged at 10% for 6 months Table 3: Greenhouse Lettuce Enterprise Budget 9PDF Image | ECONOMICS OF GREENHOUSE PRODUCTION IN ALASKA
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