California’s Dream is Becoming America’s Supply Chain Nightmare

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The Golden State has long been associated with optimism and opportunity. In a bygone era, the hit song California Dreamin' captured the essence of a free-spirited and innovative West Coast culture. Unfortunately, California’s new pipe dream of electrifying the trucking industry on an impossible timeline is becoming a nightmare for working families and businesses. 

In April 2023, an unelected Board in California voted to force trucking companies to buy zero-emission trucks.  This technology is at early-stage adoption in limited segments, and infrastructure buildout is lagging behind what is required to support electrification in our industry. The Board unanimously advanced the Advanced Clean Fleet rule to accompany California’s equally tough electric vehicle sales mandate regulation, the Advanced Clean Truck rule, that would require truck manufacturers to sell zero-emission vehicles. These two regulations together are designed to create an artificial electric vehicle market sooner rather than later.  

This new rule was made at the behest of the environmental lobby, which pushed for unrealistic targets and unachievable timelines that will undoubtedly lead to higher prices for goods delivered to the state and fewer options for consumers. ATA has strongly opposed this rule from the outset and testified at a hearing in Sacramento to express the trucking industry’s concerns directly to the Board. 

Our industry continues to say ‘Yes’ to advancing cleaner technologies, but realistic targets and timelines matter. Fleets are just beginning to understand what it takes to successfully operate battery-electric trucks and, to a lesser extent, fuel cell electric trucks. What they have learned so far is that they are significantly more expensive, new charging and refueling infrastructure is needed, and in many cases not a one-for-one replacement—meaning more trucks will be needed on California’s roads to move the same amount of freight.

Today’s clean diesel trucks can spend 15 minutes fueling anywhere in the country and then travel about 1,200 miles before fueling again. In contrast, today’s zero-emission trucks:

• Have significantly less range of about 150-330 miles between charging or refueling;

• Need to be charged or refueled more often and for longer periods of time leading to unproductive downtime;

• Cost two to three times more than a comparable clean-diesel truck; and

• Weigh thousands of pounds more, reducing payload capacity and requiring more trucks and drivers to move the same amount of freight.

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Converting the U.S. fleet of Class 8 trucks to zero emissions will require trucking fleets to make significant financial investments, which ultimately will be borne by consumers. 

Truckers face another barrier to electrification that is entirely outside their control: ensuring there is a robust network of charging stations and infrastructure. 

The California Energy Commission estimates that 157,000 chargers will need to be installed by 2030 to support California’s heavy-duty vehicle electrification goals. Given PG&E’s recent request to limit their charging station buildout in Northern California, the key proof point for truckers is going to dampen their enthusiasm for adopting zero-emission vehicle technology. According to the American Transportation Research Institute, a fully electric truck fleet would require hundreds of thousands of chargers to support an average of 1.6 million charging events each day. For this refueling method to be viable, the U.S. would need to address the severe shortage of parking that currently exists and overbuild chargers so that trucks do not need to spend hours waiting to charge.

Of course, chargers will be completely useless without the power to supply them. ATRI’s study also found that electrification of the entire U.S. vehicle fleet—both passenger and commercial trucks—would consume more than 40% of the current electricity demand, yet our aging grid can barely sustain its current needs. In California, where rolling blackouts and brownouts are not uncommon, utilities would need to generate an additional 57% beyond their current output to support an electric vehicle fleet. 

The problems identified above are serious, but they are surmountable…eventually. The solution is for the EPA to work collaboratively with stakeholders to set aggressive, achievable timelines for reducing emissions. 

We know this is feasible because we have been doing it already. Over the past 35 years, in partnership with the EPA, the trucking industry has built an impressive track record deploying the cleanest technologies available while delivering the nation’s freight. As a result, 60 trucks today emit as much as one truck did in 1988. In fact, the newest trucks on the road have: 

• 99% fewer particulate matter emissions than one in 1985; and 

• 99% fewer nitrogen oxide (NOx) emissions than one in 1975. 

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While zero-emission vehicle technologies develop and infrastructure builds out, there are commonsense actions that EPA and Congress can take to immediately make strides toward environmental sustainability and assist California with their clean air problem:

• Repeal the Federal Excise Tax on Heavy-Duty Trucks.

Reducing the cost of new, cleaner, or alternative fuel vehicles is the first step to increasing their usage nationwide. The antiquated Federal Excise Tax (FET) on heavy-duty trucks and equipment adds an additional 12 percent to the cost of every new truck. Eliminating the FET will reduce the cost of new technologies by tens of thousands of dollars and is a technology-neutral solution that allows companies to invest in not only battery-electric, but clean alternative fuel vehicles as well.

• Reduce congestion.

In 2016, truck drivers sat in traffic for nearly 1.2 billion hours, the equivalent of more than 425,000 drivers sitting idle for a year. This caused the trucking industry to consume an additional 6.87 billion gallons of fuel, representing approximately 13% of the industry’s total fuel consumption and resulting in 67.3 million metric tons of excess carbon dioxide emissions.

To reduce the amount of fuel and time that is wasted idling, USDOT should prioritize the discretionary program resources made available by the Bipartisan Infrastructure Law to address major freight bottlenecks.

Bottom Line:

California needs a wakeup call to understand that it cannot simply reengineer the highly complex transportation sector just by snapping its fingers. Wishful thinking alone will not solve these problems. The economic harm caused by this rule will be compounded when trucking companies are put out of business, retailers are unable to receive their products, and consumers are faced with higher prices and empty shelves.

The more it becomes clear that California’s rhetoric is not being matched by reality, the more pressure will be placed on the Board to change course and allow trucking companies the freedom to choose the clean technologies that work best for their operations.

We cannot allow California's dream to morph into America's supply chain nightmare.