Under the Hood: Climate Change's Growing Impact on Napa Valley
By Tim Carl
The Spotlight
Welcome to "Under the Hood," our exclusive Saturday series for Napa Valley Features paid subscribers. With recent data suggesting that summer 2024 was the hottest on record in California, this week we explore the accelerating impact of climate change on those living, working, and visiting Napa Valley.
Additionally, we’re diving into the latest data from our readers’ polls and providing insights from our economic dashboard, covering local Napa Valley, U.S. and global markets.
In addition, we feature "What We're Reading," a section with a handpicked list of recent articles providing a variety of viewpoints on issues important to our community.
Decanting the Data:
NAPA VALLEY, Calif. – Over the past 30 years, I have tracked the evolution of climate change, initially focusing on its scientific and environmental aspects and more recently examining its economic and societal impacts. While much of the discussion centers on how climate change affects grape production in Northern California — where the wine industry is a critical economic driver — a more pressing concern is its impact on the region’s people, communities and environment. As the climate continues to shift, Napa Valley, known for its agriculture and outdoor lifestyle, faces challenges that extend far beyond viticulture.
Napa Valley is synonymous with outdoor living, drawing millions of visitors each year to its picturesque vineyards, scenic hiking and biking trails and vibrant cultural events, from wine-tastings to outdoor concerts. However, these experiences are increasingly threatened as climate change accelerates. Rising temperatures, smoky skies from wildfires and more frequent extreme weather events not only pose dangers to those working outdoors but also limit recreational activities and deter visitation — key pillars of Napa Valley’s economy. These challenges threaten the essence of what makes Napa Valley a beloved destination and a vibrant community.
Don’t Worry About the Grapes
Discussions of climate change in Napa Valley often focus on its impact on the wine industry, particularly grapevine health. Yet the resilience of grapevines is remarkable. Grapevines thrive in more regions and climates than wheat, growing in the frosty soils of Nova Scotia, the chalky earth of Jerez, Spain and the humid highlands of Brazil. Traditionally, vineyards have thrived between 30 degrees and 50 degrees latitude, but as global temperatures rise, vineyards are now emerging in unexpected places, such as England, Canada and Norway. This adaptability, coupled with new technologies and farming approaches, suggests that high-quality wine grapes will likely continue to flourish in Napa Valley. However, the critical question remains: What about the people who live, work, visit and depend on this region for their livelihood and quality of life?
The Impacts of Climate Change
The effects of climate change on Napa Valley are multifaceted and increasingly severe. Wildfires have become more frequent and intense, burning hotter and spreading faster due to prolonged droughts and higher temperatures, leading to devastating losses for vineyards and surrounding communities. The Glass Fire, which was fully contained on Oct. 20, 2020, destroyed 1,555 structures in Napa and surrounding counties, including 308 homes and 343 commercial buildings, and it also damaged 31 wineries, restaurants and hotels. These fires release significant amounts of particulate matter, including PM10 and PM2.5, which pose health risks to workers, residents and visitors by exacerbating respiratory and cardiovascular conditions. Additionally, smoke from these fires causes smoke taint in wine grapes, affecting their taste and quality.
Rising temperatures also exacerbate water scarcity as reduced rainfall and increased evaporation rates strain already limited water resources, crucial for both agriculture and residential use. California has already experienced a 3-degree Fahrenheit increase in average temperatures since 1896, and this warming trend is expected to continue. The number of days exceeding 98 F is projected to double by 2040, making outdoor work and activities increasingly dangerous and less feasible. Higher temperatures can cause grapevines to shut down their metabolism and lead to sunburned grapes, affecting wine quality. These temperatures also limit the time people can spend outdoors. For every 98+ degree day, there is not only an effect on grape quality but also a restriction on outdoor work and leisure activities. Workers are limited in their time in the fields, residents and tourists retreat indoors or seek shade and visitors postpone trips.
Annual precipitation in Napa Valley is expected to become more variable, with a greater likelihood of both droughts and intense storms. Legal challenges may arise as workers contest lost wages due to weather’s limiting workdays. While the wine industry can adapt by employing new techniques, the broader community faces more complex challenges.
Environmental Strain and Ecosystem Challenges
Napa Valley's natural beauty and rich biodiversity are not immune to the impacts of climate change. The region's ecosystems, which include oak woodlands, chaparral and riparian habitats, are facing increasing stress from rising temperatures, prolonged droughts and more frequent wildfires. These changes threaten the delicate balance of native plant and animal species that depend on these habitats for survival.
Habitat loss is a significant concern as rising temperatures and changing precipitation patterns alter the distribution and viability of native plant species. The iconic oak woodlands, home to a diverse array of wildlife, are particularly vulnerable. Sudden Oak Death, a disease caused by the pathogen Phytophthora ramorum, has been spreading more rapidly due to milder winters and increased humidity. This disease is devastating to oak populations, leading to significant losses in biodiversity and disrupting the ecosystems that rely on these trees for shelter and food.
In addition to SOD, vineyards are grappling with the spread of Grapevine Red Blotch Disease, caused by the grapevine red blotch-associated virus. This disease reduces the sugar content and quality of wine grapes, leading to lower yields and affecting the region's wine production. Climate-induced stress, such as warmer temperatures and inconsistent rainfall, exacerbates the spread of this virus.
Warmer winters disrupt natural pest control as the lack of frost allows pests and pathogens to spread more easily, adding pressure on agricultural practices. The increase in warmer winter nights has led to a spread in populations of pests such as the glassy-winged sharpshooter, which threatens vineyards by spreading diseases such as Pierce’s disease.
The region's native flora is also under pressure. Many plants adapted to specific microclimates and soil conditions find themselves struggling as these parameters shift. California poppies and other wildflowers that thrive in specific soil-moisture conditions may see reduced populations, affecting the pollinators and other wildlife that rely on them for food and habitat.
Invasive species are another threat, as climate change can create conditions that allow non-native plants and animals to outcompete with local species. The spread of the yellow star thistle, an aggressive invasive plant, is facilitated by warmer and drier conditions. This thistle displaces native grasses and forbs, reducing biodiversity and altering the natural landscape. Such shifts not only impact the ecological balance but also pose challenges and extra costs for land-management and conservation efforts.
These environmental changes have far-reaching implications, affecting not just the natural landscapes that provide joy to residents and draw visitors to the region but also the agricultural lands that are interwoven with these ecosystems. As native species struggle to adapt, the overall health of the ecosystem declines, impacting everything from water quality to soil health and ultimately influencing the region's economic stability and cultural heritage.
Challenges for the Hospitality and Agricultural Sectors
The hospitality industry, which relies heavily on Napa Valley's outdoor experiences, faces significant changes ahead. Restaurants, hotels and event planners must balance indoor and outdoor offerings and will likely need to invest in expanded air-conditioned spaces to accommodate guests during extreme weather. Some events and auctions have shifted from the traditional harvest season to spring to avoid fire-related cancellations, disrupting the traditional calendar and flow of tourism.
The agricultural sector is actively seeking innovative solutions to counteract the impacts of rising temperatures on grapevines. Growers are employing techniques such as shade cloth to protect vines from excessive sunlight and heat, using specialized rootstocks that are more resilient to climate stressors and adjusting pruning methods to enhance shade and vine health. These strategies, alongside experimenting with different grape varietals, are helping vineyards adapt to changing conditions. Increased automation is also being explored to reduce reliance on a workforce vulnerable to high heat and smoke conditions. There are also advances in treating smoke taint in wine and a host of other technologies, including automation and advanced technologies, that are poised to help maintain quality standards.
A Future in Flux
Adapting to extreme and volatile conditions brought on by climate change is a growing reality, especially in Napa Valley, where agriculture and outdoor activities are central to the economy, culture and way of life. Increased automation in agriculture could lead to a reduced need for human labor, further impacting employment opportunities. If business hours are restricted due to weather conditions, employment might also decline, exacerbating the downward pressure on Napa Valley's already declining population.
As these changes unfold, people are likely to respond in various ways. Businesses may face legal challenges as workers contest lost wages due to weather’s limiting workdays, prompting a shift toward more flexible work arrangements and protections for employees exposed to extreme conditions. Residents and visitors will need to adapt to more frequent extreme weather events, likely requiring changes in daily routines and travel plans. Tourists might adjust their schedules, opting for evening activities when temperatures are cooler, similar to the late-dining culture in Spain. This shift could impact when businesses operate and how they cater to their guests.
In addition to economic and social changes, the environment will also play a role in reshaping life in Napa Valley. As native species struggle to adapt to changing conditions, residents might find themselves living in a less biodiverse and less resilient environment. Community members will need to plan for such volatility by implementing substantial adaptations in business planning, infrastructure, public-health strategies and environmental policies. The combined effects of climate change could fundamentally alter how people live, work and enjoy the region as the impacts grow increasingly disruptive.
We wrote to the Napa Valley Grapegrowers to ask how they are dealing with climate change. Here's a summary, edited for brevity, of the response from Caleb Mosley, Executive Director:
“Health and safety are top priorities for Napa Valley farming operations.” As such, growers have implemented a variety of measures to address the challenges posed by a changing climate.
Grower Weather Alerts:
NVG provides growers with weather alerts to prepare for unusual weather affecting crews and vineyards since 2014.
Crew Health and Safety:
Companies must maintain a Heat Illness Prevention Plan, which includes monitoring weather and training personnel.
Shade and water stations are provided for crews, and managers actively monitor extreme weather conditions.
Strategic Workforce Management:
Vineyard companies strategically place workers in different locations to maximize workdays, using the cooling effects of San Pablo Bay and elevation.
Night harvesting is standard, protecting crews from heat and ensuring optimal fruit quality.
Adaptation to Extreme Weather:
Vineyard operations adapt to extreme weather through vineyard design changes and improved working conditions.
Extra measures, such as cooldown rest periods, are implemented when temperatures exceed 95°F.
Companies establish their own thresholds for sending crews home during extreme temperatures or rain.
Work Scheduling:
Crews adjust schedules to complete tasks when conditions improve, ensuring all necessary work is completed despite early dismissals due to weather.
Smoke Events and Air Quality:
NVG distributes N95 respirators during wildfires and COVID-19.
Employers must provide respirators for AQI over 151, and N95 use is mandatory when AQI exceeds 500.
Evolving Viticulture Practices:
Napa viticulture is evolving with a focus on quality and efficiency.
Sprawling canopies are replacing vertical shoot positioning systems to reduce management hours while increasing shade on grape clusters (e.g., “California sprawl”).
Technologies such as automation and precision agriculture tools (e.g., soil moisture probes) are increasingly used to optimize vineyard operations, but skilled farmworkers remain essential.
Reducing equipment passes helps lower costs, soil compaction and carbon emissions.
If today's story captured your interest, explore these related articles:
Bracing for the blaze: The wine industry prepares to battle smoke taint
Under the Hood: Charlie’s in St. Helena Is Not Only New — It’s Great
Under the Hood: Navigating the Future of the Napa Valley Model
Under the Hood: Slowing Travel, Declining Wine Demand Threaten Napa Valley
Under the Hood: Napa County Faces Economic Challenges Due to Aging, Decreasing Population
Under the Hood: Napa Valley's Growing Reliance on the Wine Industry
Tim Carl is a Napa Valley-based photojournalist.
Recent Poll Results
Tim Carl's article, "Under the Hood: The Rise of Auction Culture — Fragile Funding and Community Risks," explored the complex dynamics of charity auctions in Napa Valley. While these events have raised significant funds for various causes, they also present risks related to community resource stability and the ethical implications of fund allocation. Through a series of polls, readers shared their views on the proliferation of charity auctions, transparency in fund allocation and the potential creation of a community fund from auction proceeds. The results as of Aug. 5 indicate a mix of positive and negative opinions on charity auctions, a strong call for more transparency and substantial support for establishing a community fund to ensure long-term sustainability.
The Economy
Economic Pulse Indicators Local:
The unemployment rate in the Napa County jumped 0.7% to 3.8% in June 2024, up from a revised 3.1% in May 2024 and above the year-ago estimate of 3.3%. This compares with an unadjusted unemployment rate of 5.3% for California and 4.3% for the nation during the same period. (Source)
As of Aug. 5, Napa County declined to 1,888 Type-02 winery licenses, a decrease of two from last week (Source). According to the ABC, the recent dramatic decline is at least partially due to license renewals due in late June. We are attempting to obtain past-year data to better understand this dynamic.
As of Aug. 5, California has 6,836 Type-02 winery licenses, an increase of one from last week. (Source)
As of Aug. 5, the stock price of The Duckhorn Portfolio, Inc. (NAPA) hit an all-time low of $6.62. (Source)
The labor force in Napa County rose slightly in May. (Source)
The median home price in Napa County remains lower than its peak in May 2023, with June showing a 2.5% decline from the month prior. (Source)
Zillow's latest data reveal that as of Aug. 5 home values in Napa County have experienced a 3% increase year over year to $925,081 but are down from last month’s $926,254. (Source)
Napa County’s population growth rate is currently negative 0.87% (down 1,154 from 2023) and is expected to decline significantly in the coming years. (Source)
Economic Pulse Indicators United States:
Wine production in the United States totals 806.1 million gallons, with California contributing 680.3 million gallons, making up approximately 84.4% of the nation's total wine production. (Source)
White-collar layoffs continue, with 124,517 worldwide layoffs as of Aug. 5, which is 15,468 more laid off since last week, the biggest jump this year. (Source)
California’s overall population is declining but not as fast as Napa County’s. (Source)
The July unemployment rate rose to 4.3% (Source), and the most recent household and payroll survey shifted down to 154,747. (Source)
In June, the Consumer Price Index for All Urban Consumers decreased by 0.1%, driven by a 3.8% drop in gasoline prices and a 2% decline in the overall energy index, despite a slight rise in food and shelter costs. Over the past 12 months, the all-items index increased by 3%, a smaller rise compared to May's 3.3%, with notable annual increases in food and energy prices of 2.2% and 1%, respectively. (Source)
In June, the Producer Price Index for final demand advanced 0.2%, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices were unchanged in May and increased 0.5% in April. On an unadjusted basis, the index for final demand rose 2.6% for the 12 months ended in June, the largest advance since moving up 2.7% for the 12 months ended March 2023. (Source)
In the week ending July 27, the advance figure for seasonally adjusted initial claims was 249,000, an increase of 14,000 from the previous week's unrevised level of 235,000. The 4-week moving average was 238,000, an increase of 2,500 from the previous week's unrevised average of 235,500. (Source)
U.S. Treasury yield inversion remains, although the 10-year briefly uninvited. (Source)
Gas prices remain flat. (Source)
Credit card debt remains at historic highs. (Source)
Retail trade and food services were flat in June. (Source)
The U.S. manufacturing sector contracted for the third consecutive month in June, as the Manufacturing PMI registered 46.8%, down 1.7% compared to June’s reading of 48.5%. After breaking a 16-month streak of contraction by expanding in March, the manufacturing sector has contracted the last four months and at a faster rate in July. (Source)
Economic Pulse Indicators Global:
Global GDP is expected to remain sluggish in 2024. (Source)
The United States maintains one of the lowest unemployment rates in the world. (Source)
Container rates remain at historic levels. (Source)
Japan has a negative Q1 2024 with -0.5% GDP. (Source)
United Kingdom pulls out of recession with 0.7% GDP growth in Q1 2024. (Source)
Germany GDP remains anemic with 0.2% GDP in Q1 2024. (Source)
China’s inflation rate ticked down to 0.2% (Source), while their producer price change remains stubbornly negative at -0.8% in June (Source). Consumer confidence remains near an all-time low (Source) and the property market continues to falter. (Source)
What We Are Reading:
Last week's Eye on Travel segment by Peter Greenberg features discussions on Napa Valley's wine culture, updates on travel issues and how political reputation affects tourism, with insights from experts like Karen MacNeil and Tor Kenward. (Source)
Back in late 2023, Alex Ryan retired as CEO and Chairman of The Duckhorn Portfolio, Inc., with Deirdre Mahlan appointed as interim CEO while the Board searched for a new leader; Mahlan, who has been serving as President, CEO and Chairperson since April 2024, brought extensive experience from her leadership roles at Diageo North America and Diageo plc. (Source)
The beverage industry faces significant challenges as it attempts to present a unified front against increasing anti-alcohol sentiment while grappling with internal competition and regulatory issues, highlighting the tension between collaboration on shared interests, such as federal alcohol guidelines and tax policies, and conflicts over market share and product differentiation. (Source)
Rosamund Hall emphasizes the often-overlooked exploitation of vineyard workers in the wine industry, highlighting cases like forced labor in Bordeaux and Italy's "caporalato" system, and urges consumers to be more aware and proactive in questioning the ethics of wine production to drive change and avoid complicity in these human rights abuses (Source).
A report suggests that the U.S. government's duty drawback policy, which refunds alcohol taxes on imported wine if a winery exports equivalent domestic wine, has significantly subsidized imports, benefiting large California wineries at the expense of local grape growers and the domestic wine market, leading to a decline in demand for California-grown grapes and the loss of jobs for agricultural workers, while raising concerns about transparency and long-term economic impacts on the state's wine industry (Source).
India is set to strengthen its alcohol advertising laws by banning surrogate commercials and event sponsorships, which will significantly impact major beverage companies like Pernod Ricard, Diageo and Carlsberg, forcing them to revise their brand strategies in a rapidly growing market, while manufacturers and celebrities endorsing misleading ads may face hefty fines and bans, reflecting India's stricter approach to alcohol promotion (Source).
The decline of the news industry, characterized by a significant reduction in jobs and cultural influence, has led to a loss of the journalistic "swagger" that once defined its bold and fearless storytelling, as legal threats, financial constraints and a more cautious editorial approach now dominate, stifling creativity and daring in favor of conformity and risk aversion (Source).
At the Summer Fancy Food Show, the major food trends for 2025 highlighted include a rise in ultra-spicy foods, driven by global peppers like habaneros and ghost peppers; more “swicy” (sweet / spicy) options; an increase in "apocalyptic" shelf-stable staples such as freeze-dried foods and canned meals for preparedness and convenience; a shift towards "fancy groceries" that offer elevated, restaurant-quality experiences at home; a growing popularity of ready-to-eat Korean meals reflecting a broader acceptance of global cuisines; and an embrace of honey and seed-based products that cater to a cottagecore aesthetic, offering both health benefits and novel flavors (Source).
As climate change intensifies, the occurrence of "fire clouds" or pyrocumulonimbus clouds resulting from super-hot wildfires is increasing, contributing to further fire spread and extreme fire behavior, as seen in the recent massive Park Fire in California and Jasper Fire in Canada, highlighting the need for better land management and climate change mitigation to prevent such catastrophic events (Source).
MIT and MIT-IBM Watson AI Lab researchers have developed a new calibration method, Thermometer, for large language models (LLMs) to help them better align their confidence with prediction accuracy, addressing the issue of overconfidence in incorrect responses; this method uses an auxiliary model to efficiently adjust the LLM's confidence levels without additional labeled data, thereby preserving accuracy and reducing computational costs (Source).
Another insightful article, Tim. In reading your words, I flashed back to picking plums in the summers back in the 1950s. It was hot, and the days were long, but the heat was certainly not what it is today. I am glad to see that care is being taken to protect both the grapes and the workers. Back when I was growing up in St. Helena, there were few protections that I was aware of and it was always worrisome to know that the laborers were out in the vineyards and orchards day in and day out. I am relieved to know that all of the impacts of this heating up are being studied and addressed. It will be interesting to see how the Napa Valley and many other "tourist" locations alter hours and ways that visitors, workers, and residents can enjoy the beauty and offerings of the land.