By Natalie Willis, Reporter, Valley Ag Voice
California’s regulatory environment often advances ahead of practical solutions, creating significant challenges for those it claims to benefit.
For instance, the Sustainable Groundwater Management Act, which passed in 2014, requires local agencies to develop and implement plans to reach sustainable groundwater management by 2040. Thus, immediate limitations were placed on water usage before alternative water sources were established. Researchers anticipate the fallowing of 500,000 to 1 million acres of farmland.
Farmworkers have also felt the ramifications of regulatory decisions, such as Assembly Bill 1066 which was enacted in 2016. AB 1066 requires overtime pay for farmworkers after 8 hours in a day or over 40 hours a week. Agricultural workers have historically been exempted from these labor requirements due to the seasonal nature of this work.
A 2022 study from the UC Cooperative Extension found that the bill led to sizeable decreases in weekly working hours and earnings. As a result, farmworkers earned $6 million to $9 million less than they would have made without the legislation.
Another recent case of putting the cart before the horse — a common theme in the state — includes the California Air Resource Board’s Truck and Bus Regulation, mandating farmers to replace or equip diesel trucks with engines from 2010 or newer to be in compliance. The rule was implemented to reduce emissions of pollutants like nitrogen oxides and particulate matter from heavy-duty diesel trucks.
Many independent truckers are still struggling with the financial burden of upgrading to compliant vehicles, significantly affecting smaller operators who rely on used trucks. According to Roger Islom, President of the California Cotton Ginners and Growers Association, high costs have kept these independent owner-operators out of compliance, leaving them without legal vehicles.
“They’re out of compliance right now, and they can’t get their trucks registered because they’re no longer compliant — they’re not [2010] or newer. And because they can’t afford it, right? They buy used trucks. That’s how they survive. And they are the ones that service the ag industry,” Islom said. “And so, I think there’s a segment out there that’s just hoping that they can get by until they can afford one.”
Now, California is pushing for electric trucks and zero-emission forklifts to meet impending compliance deadlines without a sustainable electric infrastructure, Islom explained.
POWER PLAY
A CCGGA meeting in May with CARB, the California Energy Commission, California Public Utilities Commission, Governor’s Office of Business and Economic Development, Cal Poly San Luis Obispo, San Joaquin Valley Air Pollution Control District and several agricultural organizations brought to light a major gap between regulatory expectations and the actual capacity of the state’s electricity infrastructure.
According to Islom, state agencies such as the CEC and CPUC assured that there was adequate infrastructure to meet California’s goals. However, the meeting between these agencies and the utilities revealed that California does not actually have the necessary capacity to meet the anticipated demand of the Advanced Clean Fleets and Zero Emission Forklift regulations.
For instance, a direct current fast charger is roughly a megawatt a piece, requiring additional substations to accommodate the demand as these regulations roll out, Islom explained.
“PG&E said, for every 20 megawatts, we need to build a new substation…and then they admitted they’ve only built one new substation in the last 10 years,” Islom said. “So, 20 megawatts, that’s 20 truck chargers. That’s just 20. We have 1.7 million trucks that operate in California on any given day.”
Islom explained that while not every truck will need to be on a fast charger, a majority will—especially during harvest season.
“During the harvest season, we’re running around the clock. So are the trucks hauling it from the gin to the warehouse, from the hauler to the processor, and then the drayage trucks from the warehouses and processors to the ports,” Islom said. “I mean, it doesn’t stop. They can’t afford to sit down for eight hours. They’ve got to go, go, go.”
Under the ACF rule, businesses with 50 or more trucks or $50 million in annual sales must convert trucks with a Gross Vehicle Weight Rating over 8,500 pounds to zero-emission vehicles. While the rule primarily affects larger businesses, the ripple is felt throughout the agricultural supply chain as larger agribusinesses are likely to pass increased costs down the line, eventually impacting smaller farmers who cannot charge more for their products to offset these expenses.
“Ultimately everybody who has to comply with this is going to pass it on down the line, and guess what? The farmer is the guy at the end of the road. He has nobody to pass it on to,” Islom said. “I can’t charge more for a pound of cotton or a pound of almonds just because California is the only area in the country and world that are requiring us to replace our trucks. We’re the ones that are going to be paying.”
Trucks will be replaced after 18 years or 800,000 miles — applying to all drayage trucks — and 100% ZEV must be reached by 2035.
Additionally, the ZEV forklift regulation, which applies to all forklifts beginning in 2026, must be replaced at 13 years old. An estimated 95,000 forklifts will be converted to electric. Agricultural compliance begins in 2029, according to Islom’s docketed presentation in the 2024 Integrated Energy Policy Report update.
UNREALISTIC EXPECTATIONS
The push toward hydrogen as a fuel alternative places additional strain on the electricity grid as the primary method for its production is through electrolysis — a process that splits water into hydrogen and oxygen using electricity.
The CEC’s latest projections show that the demand for electrolysis dwarfs what’s currently being done. In fact, CEC’s Integrated Energy Policy Report estimates that California will need to double its electricity production between 2022 and 2040 to meet electricity needs.
“Double. You can reach it, but then you’ve got to have all the infrastructure to get it from point A to point B…so, we’re not there and we’re not going to be there. Their expectations are unrealistic,” Islom said. “And this administration just said, go forward, we want to be the leaders in climate change, and they’ve completely missed the boat, but they don’t care because they’re not going to be here. This thing starts to kick in, not fully really until 2035, the forklift rule in 2026, but this governor’s gone.”
As aforementioned, a DC Fast Charger is 1 MW each, and an overnight charger is up to 500 kW. A 6,000-pound LI forklift requires a 30kW charger.
According to a CEC staff report, California will need 1.01 million chargers — including 39,000 DC fast chargers — to support 7.1 million light-duty plug-in electric vehicles in 2030.
By 2035, the state will need 2.11 million chargers — 83,000 DC fast chargers — to support 15.2 million light-duty plug-in electric vehicles.
“To support medium- and heavy-duty plug-in electric vehicles, California will need about 114,500 chargers (109,000 depot chargers and 5,500 en route chargers) for 155,000 vehicles in 2030, and 264,000 chargers (256,000 depot chargers and 8,500 en route chargers) for 377,000 vehicles in 2035,” the report stated.
An August press release from Governor Gavin Newsom’s office stated that California has installed over 150,000 chargers.
According to a Pacific Research Institute study by Dr. Wayne Winegarden and Kerry Jackson, the state’s policies are poised to create avoidable energy shortages. Their report, “Sapping California’s Energy Future,” found that California will fall 21.1% short of the electricity required to meet the state’s 2045 electric vehicle mandates.
The study highlighted that California’s green energy mandates are set to strain the grid without ensuring the necessary power generation. California would need a 20.2% increase in electricity consumption to meet the demand from electric vehicle mandates.
Further, two-thirds of California’s current electricity supply comes from natural gas, nuclear, and hydroelectric power — none of which are favored under the state’s renewable energy policies.
“It is clear by any objective measure that California is relying more on hope than a workable plan to transition to a green power grid,” Winegarden and Jackson concluded. “Not only is the technology far behind policymakers’ ambitions, the resistance to infrastructure development that is needed to sharply increase renewable energy generation is not insignificant.”
PROHIBITIVELY EXPENSIVE
Electric trucks are double the price of clean-burning diesel or compressed natural gas trucks, Islom explained. For example, a new diesel cotton module system costs about $250,000, while an electric one is over $500,000 — before considering the cost of the charging station.
According to a CARB analysis from 2022, drivers of full battery-electric vehicles save money on operation and maintenance compared to cars with internal combustion engines.
“That’s the result of cheaper fuel — charging at home costs about half as much as gasoline for the same number of miles driven — and battery-electric vehicles can save drivers 40% in maintenance costs,” CARB stated.
The analysis explained that electric vehicles are likely to reach cost parity with conventional vehicles by 2030.
However, while this takes maintenance costs into account, it does not consider electricity costs.
California has the highest rates in the continental U.S. — research from Statista explained that the state’s rate is 34.31 U.S. cents per kilowatt-hour. In perspective, the average residential electricity rate in the U.S. was 16.62 cents per kilowatt-hour in July 2024, according to the U.S. Energy Information Administration.
According to Islom, Californians can expect to see continuously increasing rates from utilities like PG&E.
“On the PG&E side, they’ve got, underground, 11,000 miles of line. They’re not even going to have the first 3,000 done until 2030, and right now, in 2024, it’s cost them $3 million a mile. What’s it going to be in 2030? What’s it going to be in 2040?” Islom said. “And again, if you follow how that all works, PG&E does not take that out of their stockholders. That money is passed along in rates.”
The limited infrastructure has also hindered the ability to expand agricultural facilities.
“I’ve had areas like a new cherry packing plant went into western Merced County, it can only operate certain months out of the year, and it can’t overlap the tomato processing that’s going on,” Islom said. “They have to be finished when the tomato season starts because their system won’t take the combined demand.”
SURVEY PARTICIPATION
To address the lack of infrastructure, a new survey was proposed during CCGGA’s meeting in May. The survey is hopeful to identify when and where electricity will be needed in the agricultural sector.
While the survey is still being fine-tuned, Islom explained that having farmers and processors participate will provide the most accurate data, showing California regulators and agencies that the current infrastructure does not support their green energy goals.
“Everywhere you turn is another regulation. DPR, Cal/OSHA, California Air Resources Board, State Water Resources Control Board. You have to fight. You’ve got to step up and be vocal, and what we are asking people, and what we do when we take our growers up to Sacramento, is you got to be up there. You got to be screaming…and support these efforts where we’re trying to get facts like this survey,” Islom said. “We need that information to show them how big of a train wreck this is going to be.”
