Economics of Homegrown Leafy Greens: A Break-Even Comparison Using Lettuce

Introduction

Fig. 1: Economic viability of indoor versus supermarket as a function of electricity price and consumption. Green regions favor indoor; red favors supermarket. Black contour marks break-even. Green dashed line indicates outdoor growing competitive threshold—outdoor wins everywhere below this line. [1-7] (Image Source: G. Xia)

In recent years, home food production has gained interest as households seek alternatives to supermarket sourcing amid rising and often unreasonable costs. Aside from the cost factor, homegrown and home-sourced leafy greens stand as an attractive target due to rapid growth and substantial yields, alongside a feeling of satisfaction from organically achieving self-sustainability. This paper addresses a quantitative question: at what production level (kg/month) and electricity use (kWh/kg) does home growing become economically competitive as compared to supermarket prices? To address this question, the analysis considers outdoor solar-powered cultivation and indoor LED-based systems as the major comparisons, incorporating water, electricity, supplies, and transportation costs as variable factors. Unfortunately, prices vary a great deal for different produce types so for simplicity, this report will focus on Lettuce and seek generalizable conclusions as far as possible.

Economic Model

To begin, the economic model must be established. The cost per kilogram for outdoor growing is:

with some values rounded (e.g. 0.19323 to 0.193). Whereas for indoor growing with artificial lighting:

where E_specific is specific energy consumption (kWh/kg) and P_elec is electricity price ($/kWh). Finally, the effective supermarket cost includes retail price and amortized transportation:

Parameters

Table 1 presents all parameters from government and academic sources that will help complete the formulas established hitherto and allow for analysis in later portions. These numbers are derived from the according sources and converted as needed. For transportation, the costs assume that food to a supermarket could be coming from across the country so this paper will assume the trip of 4,825 km from Salinas, CA, to the NYC metropolitan area. [1] Transport in this context also refers to packaging ($0.98), miscellaneous fees ($0.50), delivery equipment ($0.08), and the transport itself ($1.30) as based on the field column in Table 2 of the results section of Nicholson et al. [1] Seed costs are based on the field supplies section of Conner et al., more specifically on Table 4 in the Lettuce 2003 column ($580.70/hectare after unit conversion). [2] Indoor supply costs are based on the production supplies cost row of Table 2 of the results section of Nicholson et al., ignoring the field column as that does not apply and instead using the GH (greenhouse) columns which notably have the same value of $0.29. [1] The outdoor supplies cost is based on Conner et al., accounting for soil inputs and irrigation section for the Lettuce 2003 column in Table 4 ($1,314.60/hectare after unit conversion). [2] For conversion purposes, this provides a yield of 5,043.83 kg/hectare (converted from lb/acre) of lettuce in 2003 based on Table 5.

Cost Calculations

Now, to calculate the costs, we substitute the values of Table 1 into the above equations, obtaining

This gives the result that outdoor growing costs a mere fraction of base supermarket price at 14.1%.

Break-Even Analysis

Next is to analyze the outdoor-supermarket break-even condition comparison with 0.43 $/kg for outdoor-grown and 3.05 $/kg for supermarket prices

This indicates that no positive break-even exists and thus that outdoor growing is economically superior at all production levels.

On the other hand, for indoor growing to match supermarket prices, electricity must fall below

Fig. 2: Cost component breakdown for each method at 2 kg/month consumption. Green percentages show savings relative to supermarket baseline. [1-7] (Image Source: G. Xia)

where C_base,indoor = 0.43 $/kg. [1,2,6] At current US prices (17.5¢/kWh), indoor costs $2.68/kg. Fig. 1 shows the economic viability landscape in a visual way. The contour plot clearly reveals that indoor growing beats supermarket only in green regions (low electricity, high consumption). Unfortunately, current US conditions, as indicated by the yellow dot, fall in the red zone. Contrastingly, the green dashed line shows outdoor growing actually dominates across the entire parameter space. The visualization demonstrates that upon factoring in realistic electricity prices (5-40¢/kWh) and consumption levels (0.5-10 kg/month), outdoor cultivation still maintains economic superiority. Even in the most favorable scenarios for indoor growing - combining cheap electricity with high consumption - outdoor production remains substantially cheaper due to zero energy input costs as the technology currently has it. With the advent of improvements to vertical farming and other greenhouse techniques, it is entirely possible that this dynamic will shift soon, however, presently, outdoor farming is still more cost efficient than indoor farming.

Cost Structure

Fig. 2 presents cost breakdown. Electricity comprises 82% of indoor costs, while transportation price dominates supermarket costs. Furthermore, outdoor achieves savings versus supermarket at typical consumption. The stark difference in cost structure serves to truly reveal just why outdoor growing maintains economic advantage regardless of scale. Even accounting for all inputs including water, seeds, and soil amendments, outdoor production remains fundamentally cheaper due to free solar energy. The supermarket cost structure highlights the impact of transportation on supermarket costs, which adds a fixed cost that becomes proportionally larger at lower consumption levels. At 1 kg/month, transportation represents an 1,480% markup over base retail price and 93.67% of the total 3.05 $/kg.

Energy Analysis

Energy Return on Investment (EROI) compares food energy output to energy input. For lettuce, food energy is about 150 kcal/kg (≈ 0.15 kWh/kg). [8] Using the indoor specific electricity use for vertical/CEA systems, E_specific = 12.5 kWh/kg, we obtain [4]

Fig. 3: Economic decision matrix showing optimal method across parameter space. Green region favors outdoor. Red region shows rare indoor-competitive conditions. Supermarket never optimal. Yellow star marks typical US household. Red contour shows indoor- supermarket break-even boundary. [1-7] (Image Source: G. Xia)

This indicates indoor production delivers roughly 1.2% of the energy it consumes in electricity for growth lighting and controls. In contrast, outdoor production relies primarily on solar irradiance; aside from comparatively small inputs for irrigation and field operations, direct purchased energy per kilogram is minimal. Consequently, outdoor EROI is orders of magnitude higher than indoor, consistent with the cost results above. We intentionally omit a numeric outdoor EROI here to avoid overreach without a dedicated irrigation-energy citation.

Decision Matrix

To bring these monetary comparisons together, Fig. 3 presents the economic decision matrix spanning electricity prices (5-40¢/kWh) and consumption (0.5-10 kg/month). Overall, the green region indicates outdoor optimality across most of the parameter space. Indoor becomes competitive with supermarket purchasing only when electricity prices fall below the threshold derived above (≈ 21¢/kWh); because our supermarket cost now includes a fixed per-kg transport component, this threshold is largely independent of monthly consumption. As for typical demand, an Australian cohort reports leafy-green intake of 18.8 g/person/day [7]; applying a U.S. average household size of 2.5 implies ≈ 1.4 kg/month per household. At that point (1.4 kg/month, 17.5¢/kWh), the typical U.S. household falls in the outdoor-optimal zone, saving ≈ $3.67/month (~$44/year) versus supermarket by growing outdoors (3.05 - 0.43 = 2.62 $/kg; 2.62×1.4 = $3.67) and ≈ $0.62/month (~$7/year) by growing indoors (3.05 - 2.61 = 0.44 $/kg; 0.44×1.4 = $0.62). These savings imply outdoor payback periods of roughly 14-55 months for $50-200 starter costs, while indoor payback is far longer at typical U.S. electricity rates. Even in the lowest-rate states (~11-12¢/kWh), indoor barely reaches parity with supermarket prices and remains substantially more expensive than outdoor cultivation. [5]

Space Requirements

As mentioned earlier, there exists a big consideration for the required area for outdoor production. The following section seeks to explain the situation:

where Y = 1.75 kg/m² yield and N_cycles = 3 cycles/year. Even with a generous 2 kg/month consumption, only 4.6 m² (50 sq ft) is required. This modest space requirement makes outdoor growing accessible to most suburban households and even urban dwellers with balcony or community garden access, though it may be a time commitment and space commitment that serves as an inconvenience cost that supermarkets do not have.

Conclusions

At the end of the day, this analysis demonstrates outdoor home growing of leafy greens (specifically, Romaine lettuce) to be economically superior to supermarket purchasing at all production levels considered here, with costs of $0.43/kg versus $3.05/kg. While this report emphasizes lettuce for most of the numbers, the ideas are still fairly recognizable and the general conclusion can still be applied to other leafy greens. This could be a potential area for future research and consideration, however, as each produce process is slightly different and supplies for lettuce may not be the same as for all other leafy greens the average household might consume, warranting consideration. No minimum production threshold exists; even 0.5 kg/month yields savings. This advantage stems from free solar energy, whereas indoor cultivation requires ≈ 12.5 kWh/kg of purchased electricity. With current parameters, indoor growing remains cheaper than supermarket purchasing (≈ $2.61/kg vs $3.05/kg) but is still costlier than outdoor ($0.43/kg). Electricity would need to be ≲ $0.21/kWh for indoor to match supermarket costs. Transportation constitutes the dominant share of the supermarket price: adding $2.86/kg over a $0.193/kg production cost (≈ 1,480% markup vs production) and making up ≈ 94% of the $3.05/kg total. For households with ~5 m² of outdoor space, outdoor gardening offers practical savings (≈ $44/year at 1.4 kg/month) with payback on typical $50-200 setups in ~14-55 months. Indoor savings are modest at current U.S. electricity rates and payback times are correspondingly long given that fact.

© Galen Xia. The author warrants that the work is the author's own and that Stanford University provided no input other than typesetting and referencing guidelines. The author grants permission to copy, distribute and display this work in unaltered form, with attribution to the author, for noncommercial purposes only. All other rights, including commercial rights, are reserved to the author.

References

[1] C. F. Nicholson et al., "Economic and Environmental Performance of Controlled-Environment Supply Chains for Leaf Lettuce," Eur. Rev. Agric. Econ. 50, 1547 (2023).

[2] D. Conner and A. Rangarajan, "Production Costs of Organic Vegetable Farms: Two Case Studies from Pennsylvania," HortTechnology 19, 193 (2009).

[3] "Vegetables 2024 Summary," U.S. Department of Agriculture, February 2025.

[4] L. Miserocchi and A. Fracasso, "Benchmarking Energy Efficiency in Vertical Farming: Status and Prospects," Therm. Sci. Eng. Prog. 48, 103165 (2025).

[5] "Electric Power Monthly - October 2025," U.S. Energy Information Administration, October 2025, Table 5.6.A.

[6] M. P. Teodoro and R. Thiele, "Water and Sewer Price and Affordability Trends in the United States, 2017-2023," J. Am. Water Works Assoc. 116, 14 (2024).

[7] L. C. Blekkenhorst et al., "Cruciferous and Allium Vegetable Intakes Are Inversely Associated With 15-Year Atherosclerotic Vascular Disease Deaths in Older Adult Women," J. Am. Heart Assoc. 6, e006558 (2017).

[8] G. A. Langellotto, "What Are the Economic Costs and Benefits of Home Vegetable Gardens?" J. Ext. 52, No. 2, (2014).