Santa Cruz Organic

A. GREEN POWER PURCHASING: Why and how is the Santa Cruz Organic® brand doing it?

1. What is renewable energy?

"Renewable energy" is energy obtained from sources that are essentially inexhaustible, UNLIKE fossil fuels, for example, of which there are finite supplies. The nonprofit Center for Resource Solutions, the main group responsible for auditing and oversight of the green power industry, considers the following types of electrical generation renewable energy: wind, solar, geothermal, biomass, landfill gas, and small hydroelectric (30 megawatts capacity or less).

2. What is the Santa Cruz Organic® brand's Green Power Commitment?

The Santa Cruz Organic® brand has committed to offsetting 1,460 megawatt hours per year for three years, or 100% of the electricity generated to run the production process by supporting the generation of an equal amount of renewable energy by purchasing Green-e Certified® Renewable Energy Certificates, also known as "RECs" or "Green Tags". The Santa Cruz Organic® brand hopes its commitment will provide a good example for other banks and U.S. companies to follow.

3. Why is the Santa Cruz Organic® brand  buying Green Power (RECs)?

Environmental sustainability is at the core of who we are and what we believe in, and we consider it our responsibility to help do our part to reduce our contribution to the problem of global warming. Our organic standards already ensure that we conserve water resources, build soil and support a healthy ecosystem. By supporting renewable energy sources, we are taking a step in the right direction.The Santa Cruz Organic® brand wishes to reduce its carbon footprint, and by supporting renewable energy sources, it is taking a significant step toward achieving this goal.

4. Where does the money go?

Generating electricity from biomass and landfill gas still costs more than generating it from fossil fuel sources, inspite of exciting advancement in energy technology. The additional funds provided to renewable energy generators through the purchase of RECs by the Santa Cruz Organic® brand and others provide additional financial incentive for project expansion and future development.

B. ENVIRONMENTAL: Why is what we're doing important and what is the impact?

1. Why is renewable energy important?

Renewable energy plays a vital role in facilitating the transition away from fossil fuels, which negatively impact our environment and are a leading cause of global warming and other environmental and health concerns. Today, only 2% of the country’s electricity supply is generated by renewable energy sources. The growth of renewable energy is partly driven by voluntary purchases of green power, as the Santa Cruz Organic® brand is doing.

2. What are the environmental benefits of renewable energy?

Conventional electricity, on average, causes the emission of 1,392 pounds of carbon dioxide per MWh, a leading cause of global warming, as well as other harmful pollutants such as sulfur dioxide, nitrogen oxide, and mercury. Energy from renewable sources, such as wind and solar, dramatically reduces or even eliminates such emissions.

3. What is the impact of the Santa Cruz Organic brand's commitment?

From an environmental perspective, the commitment has a substantial environmental benefit. By supporting the generation of about 1,460 megawatt hours annually, the Santa Cruz Organic® brand is helping prevent the release of more than 2,032,320 lbs, or about 922 metric tons of carbon dioxide, the leading greenhouse gas.

This has a similar environmental benefit to 768 acres of forest absorbing carbon or removing 200 average passenger vehicles from US roadways for a year.

The chart below outlines the environmental conversion factors and information source for those factors in calculating the carbon benefit of  the Santa Cruz Organic® brand's purchase in terms of removing passenger vehicles from United States roadways.

The chart below outlines the environmental conversion factors and information source for those factors in calculating the carbon benefit of the Santa Cruz Organic® brand's purchase in terms of acres of forest storing carbon for one year.

4. Do windmills harm birds?

Some wind projects, such as the wind turbines at Altamont Pass near San Francisco, have been the subject of controversy regarding wildlife issues, most notably bird deaths attributed to collisions with wind turbines. The wind projects supported by the Santa Cruz Organic® brand's purchase use modern wind turbines, where bird deaths are infrequent because of three changes that have taken place:

1. Prospective sites for wind farms are carefully evaluated to ensure they do not fall in migration routes
2. Turbine blades are much larger and move more slowly
3. Modern turbines are built in such a way as to prevent nesting in the turbine equipment

Most wind facilities do not have significant problems with bird collision. A recent large-scale study that is typical of modern wind farms found, on average, fewer than two birds were killed annually by each turbine at the Stateline facility. Stateline is a large wind facility in Oregon and one of the largest in the United States. None of these birds were on federal and state endangered or threatened species lists. Environmental groups, such as Sierra Club and the Audubon Society, endorse properly sited wind power.

Bird deaths from wind turbines, while regrettable in any situation, are minimal when compared with the impact from other man-made objects. Collisions with cars and other vehicles are believed to kill 60-80 million birds per year, and buildings and homes are believed to kill almost 1 billion birds per year. By contrast, it is believed that collisions with all of the wind turbines in the U.S. result in just 40,000 bird deaths annually. Developers of new wind projects give significant attention to avian issues to attempt to even further reduce this impact. (Source: Study by Western Ecosystems Technology, E-Magazine, January 2005)

Finally, the Santa Cruz Organic® brand does not support the controversial Altamont Pass wind project outside San Francisco.

C. TECHNICAL: How Does It Work?

1. What are Renewable Energy Certificates (AKA "RECs" or "Green Tags")?

Renewable energy has two components: the energy commodity and the corresponding green power attribute.

The Energy Commodity is the actual electricity produced at facilities that generate the renewable electricity. The electricity generated is sold by the renewable generator as conventional/generic (market) power stripped of its environmental benefits, or attributes. No environmental claims can be made on this power, because it is separate from the associated environmental benefits that are embodied by the Renewable Energy Certificate.

A REC acts like a claim check on each MWh of renewable electricity delivered to the grid by, for example, a wind farm or a landfill gas facility. The purchaser of a REC owns a claim to the environmental savings (such as CO2 reduction) that results from the production of that electricity. A REC verifies the source of electricity is renewable in nature. RECs allow their purchasers to support renewable energy projects even if the purchaser does not use electricity nearby.

2. What are the renewable energy sources involved and where are they?

The Santa Cruz Organic brand's commitment is supporting landfill gas and biomass facilities across the United States.

3. Are the renewable energy facilities considered "New"?

Yes. All of the facilities supported by the Santa Cruz Organic® brand's commitment began operation on or after September 2001. The Santa Cruz Organic® brand wants to utilize its purchase to help develop new renewable energy sources. These recently constructed projects were built to meet the growing demands of organizations like the Santa Cruz Organic® brand.

4. Does this mean Santa Cruz Organic brand facilities run on green electricity?

No. It is not possible to send the electricity directly to a building or any other specific end user location because of the nature of the electricity grid. Electrons are stubborn. You can't tell them where to go. Once renewable electricity is delivered to the electric grid, it mixes with power from other generating plants. This means the actual electricity generated from ‘green’ sources cannot be directed to a specific home or business.

The Santa Cruz Organic® brand's commitment assures an amount of renewable energy equal to 100% of our electricity usage will be delivered to the electricity grid, the large pool of electricity that we all draw from for our homes and businesses.

Through our commitment and the commitments of others, the pool of energy over time is becoming greener and cleaner, because less electricity from natural gas, coal, or other non-renewable fuels is required to meet demand.

5. Does this affect the reliability of electricity provided to the production facilities?

No. The electricity will continue to be uninterrupted. As always, each location is still connected to the respective regional electricity systems.

D. GENERAL INFORMATION

1. Is this program certified?

Various organizations, including environmental groups and public utility commissions, require a full accounting of renewable generation and expenditures. In addition, the renewable energy the Santa Cruz Organic® brand is supporting meets the Green-e® standards developed by the Center for Resource Solutions, an independent nonprofit organization that certifies renewable energy solutions. The Green-e® standards are set with input from a variety of constituents, including environmentalists, utilities, and consumer groups. For more information, visit http://www.green-e.org/.

2. What is Green-e®?

The Green-e Program (http://www.green-e.org/) sets consumer protection and environmental standards for electricity products, and verifies that Green-e Certified® products meet these standards. To learn more about the Green-e®, visit http://www.green-e.org/ or call 1-888-63-GREEN.

3. What is the EPA Green Power Partnership?

The EPA Green Power Partnership is the federal recognition body supporting organizations that voluntarily power their businesses with renewable energy. The Green Power Partnership encourages organizations to use green power as a part of best-practice environmental management. Participation in the EPA Green Power Partnership will bring technical expertise to the Santa Cruz Organic®brand and national recognition through awards and press announcements. the Santa Cruz Organic® brand is a member of the EPA Green Power Partnership. For more information, visit http://www.epa.gov/greenpower/.

4. What other businesses are participating in Green Power?

There are thousands of businesses supporting green power across the United States either through direct purchases through utility green pricing programs or by purchasing Renewable Energy Certificates. To see the top purchasers in the U.S., visit http://www.epa.gov/greenpower/toplists/top25.htm

5. Who is our supplier? 3Degrees?

3Degrees is the provider of Green-e Certified® RECs to the Santa Cruz Organic® brand. 3Degrees builds global markets that foster more sustainable businesses and communities. The company and its employees are committed to delivering market expertise and the highest quality and integrity products and services. 3Degrees delivers customized global climate change solutions to U.S. businesses, utilities and institutions. The company engages customers to develop, execute, and communicate sustainability strategies that add value to their brand. The company's expertise in sourcing verified carbon offsets and certified renewable energy certificates enables customers to reduce their carbon footprint. 3Degrees services 25,000 customers in all 50 states, Canada, Mexico, Belgium, and Brazil. Information on 3Degrees may be found at: http://www.3degreesinc.com/.