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New Report Finds Diesel Power Key To Success Of California Economy

The report, released by the Diesel Technology Forum (DTF), highlights the crucial role that diesel technology plays in key segments of the California economy, including the state's massive agricultural sector.

"This report is the first to document the economic impact of diesel in California, and the findings clearly show that the state's future economic growth is strategically linked to diesel power," stated Allen Schaeffer, executive director of DTF. "Today's farms are more productive, freight-hauling systems are moving more goods with greater cost efficiencies, we are transporting more people, building more new businesses, and contributing to a higher standard of living - thanks in great measure to the efficiency and reliability of the diesel engine."

Diesel Technology and the California Economy indicates that the three segments at the core of the California economy-agriculture, construction and transportation- all rely heavily on diesel-powered equipment to produce their respective goods and services. According to today's report, these three sectors alone-which employ more than 3.4 million Californians-contribute a total of approximately $156.4 billion annually to the state's gross product. Of that, diesel power is directly responsible for $12.4 billion annually, or nearly 10 percent of the state's gross product for these sectors.

"Despite significant economic contributions, the vital role of diesel in California is often overlooked," says Schaeffer. "Initiatives in California to limit or ban diesel use could potentially cause economic damage in the form of higher consumer prices and loss of jobs. If Governor Schwarzenegger's administration doesn't fully take into consideration the enormous economic contributions and inherent benefits of clean diesel technology, it could hamper California's ability to reach its environmental and energy goals, and a return to prosperity."

Agriculture is among the California industries that are most reliant on diesel power. The most productive and economically valuable agricultural economy in the world, in 2000 California's 74,000 farms contributed $19.1 billion to the state's gross product. Diesel powers a large majority of California farm equipment, moves products to market, and pumps a large share of the water used in irrigation. These uses have contributed significantly to productivity improvements in the agriculture sector, helping decrease the cost of food. Agriculture spent $534 million on diesel technology in 2000, representing about 2.8 percent of total costs incurred by agriculture in California.

Other key findings of the report:  

• Construction. California's construction industry relies heavily on the large horsepower capability, mobility and durability of diesel power. In 2000, construction contributed $108 billion in value added to the state's gross product, and purchased $11.72 billion in diesel technology goods and services.
• Freight. Trucks, trains and ships are all predominantly diesel-powered. For example, diesel propels 90 percent of the state's heavy-duty truck travel. In 2000, the freight-hauling industry produced $58 billion in services, adding $29 billion in value to the gross state product. The industry spent $2 billion on diesel technology inputs in 2000.
• Transit. Buses, which transport two-thirds of the state's transit passengers, are primarily diesel-powered. California's transit and local and interurban personal transportation industry delivered $4.4 billion in services, with a value added of $482 million in 2000. These sectors spent $596 million on diesel technology inputs in 2000.

In addition, most fire trucks and other heavy emergency vehicles use diesel. The emergency standby generators that powered hospitals and other critical facilities during the 2000-2001 energy crisis are almost exclusively diesel. There is no economic sector in the state that does not benefit from the contribution of diesel power.

Diesel is uniquely qualified to perform many of these functions because it is more energy efficient, provides greater power output in large applications, is more durable and reliable, and is safer to handle. "Together, these features mean cost savings to businesses and, ultimately, to the consumer," said Schaeffer. "Without diesel power, many of the tasks our society needs done would be more expensive, difficult or simply impossible."

The diesel industry is also committed to working together to meet upcoming emissions standards for both on and off-road diesel engines. Schaeffer concluded, "New clean diesel power is a technology of the future as much as computerization, the digital age and fiber optics, and it will continue to have a major impact on the California, the United States and global economy"

To view or download a copy of the complete report, please click here. The report was compiled by M.Cubed and is a supplement to Diesel Technology and the American Economy, prepared for the Diesel Technology Forum in 2000 by Charles River Associates.  

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The Diesel Technology Forum represents engine makers, fuel producers and emissions control manufacturers. It brings together the diesel industry, the broad diesel user community, civic and public interest leaders, government regulators, academics, scientists, the petroleum industry, and public health researches, to encourage the exchange of information, ideas, scientific findings, and points-of-view to current and future uses of diesel power technology. For more information about the Forum visit our web site at www.dieselforum.org.