Cost vs Revenue

Profit is the difference between revenue and costs. For the company, especially the internal costs matter, but on a higher level, e.g. the level of the society or of an ecosystem, costs related to the use of natural resources like water or emissions of greenhouse gases are equally important. Investments into installations like the greenhouse are fixed costs, whereas expenditures for fertilizers, pesticides or energy are variable costs. The latter are relevant for day-to-day control decisions, whereas fixed costs are more strategically important.

We are looking at a future of renewable energy systems, relying far more on solar and wind than on fossil fuels. However these systems can vary wildly in their hour to hour energy output, in sharp contrast to already established generators. This necessitates the development and creation of large energy storage solutions, like hydroelectric dams and water pump systems. While at the current time energy prices are often cheaper at “off peak hours” [Wikipedia] this could change in a future more dependent on renewable energy. Here, the necessity of energy storage will be the limiting factor, perhaps resulting in cheaper energy during the day and windy hours. The revenue is the product of the (marketable) yield and the price per unit produced, which, in vegetables, depends mostly on quality and season.