November 2013 Environment Committee Meeting

EMC 2831 Mission College Blvd Santa Clara, CA

San Francisco Conference Room 1:30 – 4:00 pm

Conference Call Information:

Dial: 1-424-203-8075; Participant code: 1052733

Agenda

Time Item Who Outcome

1:30 Networking and conversation All Information

2:00 Welcome & Introductions

Keren Pavese, EMC Information

2:05 Approve September committee meeting minutes

Jim Davis, KPMG Action

2:07 Conflict minerals – issues & best practices in reporting

Joanne Foley, Affymetrix

2:20 Water and climate-related risks Ana Zacapa & Brooke Barton, CERES

Discussion

2:55 Green Supply Chain – in-depth discussion Francesca Wahl & Ed Quevedo, Mills College

Action

Presentation and discussion – Mills College proposal

Scoping and definition – sustainable vs. green supply chain

3:25 SV 2.0

Francesca Wahl Action

3:40 Low Carbon Fuel Standard Task Force Lori Duvall Information

3:50 Committee strategy 2014-2016

Mike Mielke Action

4:05 Reminders / Open Forum

All Information

4:15 Adjourn

All Action

Reminder: December 18 is our annual end of year joint meeting / celebration with the SVLG Energy Committee at Silver Spring Networks in Redwood City.

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September 25 SVLG Environment Committee Meeting Notes & Action Items

Tonie Hansen, Nvidia Host

• Guest Speakers: Kris Rosa (Noteware Government Relations), Joe Caves (Conservation Strategy Group), Omar Romero Hernandez (UC Berkeley),

Attendees

• Members in person: Sean Riley (Cargill), Jim Davis (KPMG), Chuck Wilhelm (Enlight Energy),Leo Kenny (Intel), Derek Banta (UPS), Lou Ramondetta (Surplus Service), Dan Sheehy (WattzOn), Kirk Willard (LMCO), Sean Riley (Cargill), Cici Grant (Huwai), Roy Hayes (AERC Recycling), Laura Clemson (Nvidia), Bruce Klafter (Flextronics),

• On the Phone: Jim Levine and Adrian Covert (Bay Area Council); Frank Lopez and Ron Gastelum (LA Chamber) – all joining for water bond discussion

• SVLG: Mike Mielke, Francesca Wahl

1. August meeting minutes

Agenda Items

• Status: Approved (unanimous)

2. Review of 2013 CA Legislative Session

• Kris Rosa, Noteware Government Relations i. End of Session Wrap-up

1. New dynamic for Legislature playing out with a more moderate Democratic Caucus (first year for the “12 years olds”); a lot of hope for this class; products of redistricting and top 2 primary; for the most part it rplayed out well with a number of mods stronger and unafraid in taking more prominent positions; stakeholder groups that helped Ds didn’t want the moderates to win (Labor heavy against mods); can hold seat and win district; controversial bills and the moderates stuck together; changes in thoughts of who should be the next speaker – Anthony Rendon was being groomed to take over speakership; Freshmen want reigns of power immediately.

2. Leadership Changes: Speaker’s and Pro Tem’s last year is next year; De Leon and De Saulnier running for Pro Tem; who has the “x factor?”; Special election Hawley Mitchell migrated into Senate (maybe replace Darrell).

ii. Status Update 1. SB 279: On the governor’s desk, bipartisan bill; important to region and

what Leadership Group been working on; streamline process to restore wetlands area around the Bay; technical clean-up bill;

2. EPR Bills: All sponsored by CA Product Stewardship Council is sponsor of all of these bills; have narrow philosophy on recycling; expensive methodology and very punitive; EPR manufacturer of the product has responsibility of finding product at end of life and getting it back so it doesn’t go into the waste stream; Complicated and prescriptive methodology; recycling programs don’t work unless there is use for the consumer; broad definition for battery; expensive to implement ; framework wanted for every product in the state ; what is the strategy moving forward? ; Bills will not move forward ; SB 727 may have more legs because chair of committee more liked

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3. Water Bond: Wolk and Rendon bill; informational hearing on water bond and how different from Bond that was passed into 2009; marketing, size etc.; identifying agency; should delta funds be funneled through delta conservancy and at end of day, none of these questions were answered; Rendon dedicated to this effort; Wolk very formidable and tough

3. CA Water Bond – 2014 Ballot Measure

• 2009 Legislature passed a number of bills on water reforms including bond; the Leadership Group supported entire package, including the bond

• State is still relying on water storage system that was last updated in the 60s

• Large scale investment needed in various areas

• Recent poling on current bond (see slide); only 42% voters support; two legislative proposals currently (Wolk SB 42 and Rendon AB 1331)

• SVLG has been working closely with LA Chamber and Bay Area Council on the bond

• Special guest – Joe Caves, Conservation Strategy Group i. Legislature has not been able to pass a successful water bond since 1999;

politics getting to a 2/3 vote are in difference between urban and agricultural areas

ii. Couple of initiatives have passed and in each case have had no opposition iii. Stand out: 1) Size of bond creates sticker shock; 2) basic framing of the bond

and heavy emphasis on storage and delta; those don’t tend to be high priorities for voters which interested in safe drinking water and pollution closer to home; 3) level of opposition since 2009 from Delta and Environmental Community; some enviro groups willing to support bond; bond needs good support from Bay Area to get through; “water grab” framing is a huge disadvantage – affects support and further diminishes numbers ** have to address all of these issues on some level** Is any water bond viable in 2014?

iv. Water Bond is feasible if framed and developed in the right way. Cost, reframe measure about putting a greater emphasis on water quality and safe drinking water, and if can knock down opposition (enviros and Delta interests) can have chance at ballot; Both of Wolk and Rendon’s bonds are good starts.

v. Wolk bond supported by the Delta Communities (invests in same as Rendon bond and current bond but does so in ways that more susceptive to delta communities);

vi. Both bonds have sizeable funding for storage, which often cause state wide bonds to crash (ag industry); Current bond $3billion continuously appropriated for public benefit portion of dams (can be matched up to 50%); Dams currently cost $8 billion and high likelihood that not going to find people to pay for second dam

vii. Additional storage needed in the system; politically viable way to meet storage is a huge challenge

viii. Difference between two: AB1331 $1.5 billion basically used as current bond SB42 $1 billion focus on being able to fund competitively large and

smaller storage products or groundwater project ix. Bay Area Flood control projects could also be helped out x. Q&A:

2014 Focus

•

: No real sense the Gov. will lead on this; What is the political viability of this?

Joe: Gov engagement is going to be necessary; biggest fear is same as water contractor; no one wants to put bond on ballot that is referendum on BDCP; chance that if Gov. is all-in we could overcome issue; in absence of Gov. commitment, get the Delta counties in support and have worked with Wolk’s office to

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get there; in each case the State is going to have to put a significant amount of habitat money in; helps advance BDCP without being a referendum to BDCP

Are current proposals underfunded?

•

Joe:

State has history of smaller bonds in 80s; general policy of the state is that only use bond dollar to pay for public benefits; number of big storage been built but been built by urban facilities that have rate base to support it; challenge has been is there a public benefit theory to get dams to point where make sense; get back to passing less controversial bonds; want to make sure ratepayers are paying for supply benefits; possible to get back to incremental funding strategy if depoliticize water bond issue

Jim

•

: Are all of them mutually exclusive? SB 42 seems most tailored to hitting the key areas of most value

Joe:

1331 takes current bond and cuts it in half and tweaks certain section. SB 42 reorient toward things where clearer public purpose and need and make it more of a consensus measure; allocates a little more to regions? Every region analyses issue differently; most of money in both bonds ultimately allocated in regional basis; big tickets items not in that category are delta and storage (low populated NoCal and Valley areas)

Mike

• : What happens to BDCP if none of these bonds are successful?

Joe:

It will proceed even if none of these don’t pass; 2-3 years away from permits; uncertainty about whether or not the feds will issue permits; BDCP doesn’t need bond to pass but does need a long run public contribution to ecosystem restoration

Mike

• : Employment related benefits?

Joe:

Significant portions of bond that do involve localized infrastructure investment particularly in recycling as well as storage projects; improving water system through BDCP real dwarfs bond in terms of employment perspective

4. Green Supply Chain – In Depth Discussion

• Omar Romero Hernandez, UC Berkeley i. Supply chains are a big issue for companies; SVLG has opportunity to come

forward and note what is working and what is not to inform legislation as the CA Legislature is looking at introducing a bill

1. Project Scope and Timeline a. Great chance for companies to bring forward the idea of what’s

working and what is not working 2. Legislation has been drafted in the past and no real sense of what is

happening, for good or ill (Need to inform development of any future legislation)

ii. Question1. Premise is that legislation may not be necessary

: Intent of research, no need to legislate this?

2. To some extent it teas up what Tonie Hansen was talking about earlier; if there are B2B demands, then don’t need further legislation

iii. Research Goals: 1. Legislators would not go through this process themselves and try to

leverage any sort of research and analysis put out there by any type of body

2. A lot of “me too” legislation currently a. Educating members to help them understand the issues

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3. Share what is happening, what is working/not working, and what are the real hot spots.

iv. Sustainable Supply Chain is really an innovation engine as well; economic driver for it and what else has been done out there; Rich Gordon has approached us proactively to this point

v. Opportunity to shape legislation 1. Opportunity to kill something before it starts 2. Let companies do what they do 3. Electronic waste is a good case in point and there is infrastructure in

California set up to fund it; driven through supply chain; 4. Legislation can be a carrot too (reward companies that are already

moving in right direction) 5. Bruce

6. Issue: How do you define green?

: One of the questions whether there is value in transparency regarding all this legislation?

a. Are we including social responsibility? Green chemistry and green engineering vs. green supply chain? (Lou)

b. Bruce

c. EPR bills show big issue of what any bill would cover in terms of products?

: It definitely includes social and would be lumped all into sustainability; Who is picking the cotton, not necessarily what type of cotton product is it? How they are produced; broader issues and all the different elements;

d. Are we looking at product usage issues, how things are end of lived? Research agenda define? Supply web

7. If other large companies in when dollars are flagged and ultimately paid? a. ** UPS would like to participate**; b. Can we work with Asm. Gordon and hold off until next legislative

session? c. Questions need to be addressed in order for members to take

this back in order to make a determination on where they think their risk and opportunities are of this.

d. Note

*

: Important to have a sector focus and what are some limiting constraints (focus on our core strength which is tech)

Action

: Reevaluate Proposal at end of 2013 / beginning of 2014. Define what was is incorporated under “green supply chain.”

5. Committee Priority Setting and Planning Discussion

• Review Committee Planning Timeline i. Aug 15 – Panel of outside experts ii. Sept 5-18 – Committee priorities survey iii. Sept 25 – Review draft strategy with committee iv. Oct 10 & 11 – Strategy presented at Strategy Conf. v. Nov 13 – Work Plan finalized by committee vi. Dec 12 – Top priority and top accomplishments presented at Q4 Board & Annual

Shareholders mtg. vii. Action: See Slides for additional details.

• Review 2013 Accomplishments i. Action: See Slides for additional details.

1. Events: Merged Energy and Sustainability Summit 2. Legislation Side: Supported 5 bills that are on Gov’s desk; helped kill 3

that never reached the Gov.

• Review 2013 Committee Survey Results

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i. Highlights: Corporate Environmental Sustainability continues to be a top priority for members. Water and EPR also continue to be important issues. Networking is one the greatest benefits of committee meetings. 0% of membership is dissatisfied.

• Discuss Draft 2014-2016 Work Plan – Need executive commitment on big items i. Climate

1. State and Regional Climate Change Efforts a. Continue to be active on AB 32 and other regulatory efforts as

they come up b. Key state legislation that effect AB 32 c. Development of Goals for AB 32 post 2020 (executive order) d. Engaging as appropriate on potential ballot measure on AB 32 e. How will the tug of war on C&T issues play out (high speed rail

initiative etc)? f. Staff time and resources will be severely impact if there is a AB

32 ballot measure g. SV 2.0 engagement; other bay area efforts on resiliency

planning; when and how will county finish defining scope? ii. Water

1. Water awards engagement 2. Key state legislation 3. Water technology next generation, nascent industry 4. Provide input as appropriate on potential water bond 5. Key issues: level of engagement on bond depends on a number of

factors (public support, addresses our issues, whether or not gov. engaged)

6. BDCP work with Sacramento and DC and Sac Valley Water District to support what we need here (public review period Nov. 2013-Mar 2014 critical time)

7. Baylands issue: continue to work with our task force; restore wetlands in South Bay particularly and make sure we are prepared for flood risk; don’t have the types of levees that we need; strategy development; public education campaign; staff time and resources would be impacted

iii. Corporate Sustainability 1. Showcase solutions at energy and sustainability summit

a. PWC survey 60% CEOs responded that there is not a compelling business case; plenty of room for this

2. Enabling policy 3. Explore P3 to scale solutions 4. Executive series (fora) CFO and CSO engagement

a. What is the best way to engage the c-suite? b. Like the idea of adding a forum c. Tap into SVLG company representatives into what this company

and what the summit are all about i. Discussed launching a fora series and now we need to

make that happen ii. UPS is sponsoring research called “Changing the chain”

(15 high tech executives) love the opportunity to share what we learned here in the Valley and socialize it

1. Never have time to focus on supply chain because of terms and the end of the quarter

2. UPS view of sustainability is that have to be economically viable, environmentally conscious wherever possible; broader context

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3. Social impact of labor costs in other countries but what happens if you pull that factory out, what do those people do then? How do you manage way responsibly out of that?

5. Sustainable Supply Chain issue a. What do we develop as a strategy moving forward? b. What is the sense of people in the room?

i. If we can frame this a bit more we could move forward with a critical mass.

ii. Have discussion with Haas/others parallel with the Legislature and come back early next year with a timeline (taking study to board in December to make worthwhile effort)

*Action

: Need to better frame the issue, scope the project and them explore. Re-evaluate Proposal for beginning of 2014. Define what was is incorporated under “green supply chain.”

6. Next meeting – November 13, hosted by EMC

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Conflict Minerals – General Overview 'Conflict minerals' are certain minerals that have been linked to the armed conflict in the Democratic Republic of the Congo, creating a humanitarian crisis characterized by extreme levels of violence (particularly sexual and gender-based violence) against civilian populations. Section 1520 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, adopted by the United States in July 2010, introduced a new reporting requirement in the SEC (Securities and Exchange Commission) annual report that must be filed by all publically traded companies in the US, whether domestic or foreign. The SEC Final Rule was adopted August 22, 2012. Conflict mineral usage must be reported by calendar year, regardless of the company's fiscal year. The first SEC reports will be due May 31, 2014 for calendar year 2013. What are the 'conflict minerals' (and their deivatives)?

Columbite-tantalite (coltan) is the metal ore from which TANTALUM is extracted; Tantalum uses include electronic components (mobile telephones, computers, videogame consoles, digital cameras) and alloys for making carbide tools and jet engine components

Cassiterite is the metal ore most commonly used to produce TIN; tin uses include alloys, tin plating, and solder for joining pipes and electronic circuits

GOLD uses include jewelry as well as electronic, communications & aerospace equipment (provides superior electric conductivity and corrosion resistance)

Wolframite is the metal ore used to produce TUNGSTEN; tungsten uses include metal wires, electrodes and contacts (lighting, electronic, electrical, heating, welding applications)

Any other mineral or its derivatives that the Secretary of State determines to be financing conflict in the DRC countries

SEC regulations outline a three-step disclosure requirement based upon the following questions: Question #1: Are conflict minerals “necessary to the functionality or production” of your product?

If a mineral is “necessary” the product is covered without regard to the amount of the mineral involved (no de minimis proposed)

Includes products where conflict mineral is intentionally included in the production process, even if it is not included in the final product

No action is required if products do not contain one of the conflict minerals

Question #2: Did your conflict minerals originate in "the DRC countries"?

Includes the Democratic Republic of the Congo and all adjoining countries sharing an internationally recognized border -- currently Sudan, Uganda, Rwanda, Burundi, Tanzania, Zambia, Angola, Congo and Central African Republic

Must make a “reasonable country of origin inquiry” to determine the source and chain of custody of your conflict minerals; smelter certifications and/or supplier declarations must be reasonably reliable

Note: cannot establish country of origin for recycled minerals

Due diligence in the supply chain requires the use of a national or international standard and an audit performed by an independent third party

Question #3: Did your conflict minerals “directly or indirectly finance or benefit armed groups” in the DRC countries?

Armed groups are those listed in Country Reports on Human Rights Practices (released annually by the Department of State) as perpetrators of serious human rights abuses

Criteria include physical control of mines; use of forced civilian labor; the taxation/extortion/control of trading facilities or any part of the trade route

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"DRC conflict free" means conflict minerals did not finance or benefit armed groups in the DRC countries; recycled minerals are considered DRC conflict free

The SEC Final Rule requires two levels of disclosure: Conflict Minerals Disclosure is required for products that contain conflict minerals (regardless of origin). It is submitted as a separate heading in the body of the SEC annual report and posted on your company website. Required elements include:

Whether conflict minerals originated in DRC countries

Whether conflict minerals were obtained from recycled or scrap sources

Brief description of your company’s "country of origin inquiry" Conflict Minerals Reporting is required for products containing conflict minerals from the DRC countries, for recycled materials, and when DRC countries cannot be eliminated as the country of origin. It is submitted as an exhibit to the SEC annual report and posted on your company website. Required elements include:

Description of products with conflict minerals

Whether products are “DRC conflict free”

For products not “DRC conflict free”: country of origin and processing facility for the conflict minerals

Due diligence measures taken to establish the source and chain of custody of the conflict minerals; your efforts to determine the mine/origin with the greatest possible specificity

Due diligence measures taken to determine the conflict minerals were recycled or scrap (reclaimed from end-user or post-consumer products)

Audit report of the independent private sector auditor

Certification by the person filing the SEC report

OUR HISTORY

Ceres is an advocate for sustainability leadership. Ceres mobilizes a powerful network of inves-tors, companies and public interest groups to accelerate and expand the adoption of sustainable business practices and solutions to build a healthy global economy.

Mobilizing investor and business leadership to build a thriving, sustainable global economy.

In 1989, a major environmental disaster shook

public confidence in corporate America – the

Exxon-Valdez oil spill. Nearly 11 million gallons

of oil poured into Alaska’s Prince William Sound,

devastating one of the world’s most pristine

habitats. Suddenly, the environmental cost of

doing business became painfully clear and it was

apparent that companies weren’t doing enough to

account for the environmental and social impacts

WHO WE ARE

OUR MISSION

of their operations. Six months after the spill, a

group of investors launched an organization to

tackle this problem: a nonprofit called Ceres.

At its founding, Ceres introduced a bold new

vision to the business community – a vision of a

world in which business and the capital markets

promote the well-being of human society and

the protection of the Earth’s environment.

IN BRIEF

www.ceres.org

99 Chauncy Street // Boston MA, 02111-1703 // 617.247.0700 // Twitter @ceresnews // www.facebook.com/ceres.org // info@ceres.org

Since 1989, Ceres has achieved dramatic results, including:

OUR ACCOMPLISHMENTS

Launching the Global Reporting Initiative (GRI), now the de-facto international standard used by more than 1,800 companies for corporate reporting on environmental, social and economic performance.

Spearheading dozens of engagements with com-panies that have led to achievements such as:

• Ford committing to reduce the amount of water used to make each vehicle by 30 percent globally by 2015;

• Levi Strauss & Co. pioneering a new, collaborative approach to improve global worker well-being throughout its supply chain;

• Best Buy launching a cutting-edge “Buy Back” program for its electronics products and setting an additional goal to recycle 1 billion pounds of consumer products by end of 2014;

• Gap setting its first GHG emissions reduction target - a 20% reduction by 2015

Persuading the Securities and Exchange Commission (SEC) in 2010 to issue formal guidance on climate change-related disclosure companies must provide to investors in their financial filings.

Elevating corporate and investor awareness of growing water scarcity risks. Key highlights include defining a new standard for corporate water stewardship through the Ceres Aqua Gauge, a tool for investors and companies to assess and manage water risk; and spurring tougher credit rating agency scrutiny of water scarcity risks in municipal water bonds.

Developing innovative frameworks to guide corporations and investors, such as 2010’s The 21st Century Corporation: The Ceres Roadmap for Sustainability, and 2012’s The Road to 2020: Corporate Progress on The Ceres Roadmap for Sustainability, the first broad assessment of corporate performance by 600 US companies on key expectations such as carbon emissions reduction, energy and water management, and supply chain sustainability

Receiving numerous awards, including being named one of the Top 100 Best NGOs by The Global Journal, the 2010 United Nations’ “Leader of Change” Award and the Skoll Award for Social Entrepreneurship.

Launching Business for Innovative Climate & Energy Policy (BICEP), a coalition of more than 20 leading consumer brand companies advocating for strong climate and clean energy policies in the U.S.

Influencing the Obama Administration to release new proposed fuel economy and greenhouse gas emissions standards, which will raise fuel economy to 54.5 miles per gallon on average for new cars and light-duty trucks by 2025. That is nearly double the fuel economy and half the GHG emissions of 2010 vehicles.

Securing mandatory requirements for climate change risk disclosure by the insurance industry to help protect investors and customers.

Directing the Investor Network on Climate Risk (INCR), a group of 100 leading institutional investors collectively managing more than $10 trillion in assets focused on the business impacts of climate change.

Research Partner

Mills College’s Center for Socially Responsible Business (CSRB) is a research institution that conducts original research for corporate and not-for-profit clients that help them understand and further their own social and financial strategies more effectively.

CA Green Supply Chain Project Proposal Issue The Silicon Valley Leadership Group (SVLG), a member-driven, high-tech public policy trade association, has been made aware of interest by the CA Legislature to explore legislation next session around socially and environmentally responsible supply chains.

Background Greening the supply chain is becoming popular with many companies that are interested in driving efficiency and minimizing cost. However, the issue is complex as multinational supply chains in some cases span thousands of suppliers spread all across the globe. While there have been a number of recent efforts to address issues in supply chains (conflict minerals and human trafficking for example), there is still a paucity of data on the impact of various measures.

Business Taskforce SVLG's premise is that new legislation may not be necessary

. Further, any new legislative proposals should be based upon evidence of need and should be developed with input from the businesses that are/will be impacted to ensure optimal, value-generating outcomes. Towards that end, it is important to understand the scope, cost and effectiveness of current legislation. Thus, SVLG proposes to do the following: • Industry taskforce – Launch a taskforce composed of key high-tech member company sustainability

representatives to provide industry insights and guidance to the legislature • Research partnership – Partner with the UC Haas Business School’s Center for Responsible Business to

develop a report that analyzes the current legislative landscape and recommends the optimum framework for engagement

• Time commitment: SVLG staff will provide direct support; taskforce members will meet up to (but no more than) once a month for project duration; no exhaustive analytical work required by TF members.

Taskforce member expectations

• Timeline: September 2013 – February, 2014 • Estimated financial commitment: $5,000 – $9,000 per participating member company (Amount

depends upon final scope and number of member participants)

• Report on legislative and regulatory measures on green supply Deliverables

chains at the state, national and global level • Analysis of effect of existing legislation; cost, intent, pros/cons • Recommendations regarding appropriate government role and

industry engagement on green supply chains Note:

SVLG advocacy will be informed by report findings

Invited Companies (current list)

• AMD • Cisco • Google • HP • Intel • Microsoft • NVIDIA • Oracle Next steps • Detailed project scope, including timeline, deliverables, and working relationships between parties • Launch SVLG industry taskforce and Haas / CRB research team

SVLG Staff Contacts • Mike Mielke | Vice President, Environmental Programs & Policy | mmielke@svlg.org; 408-501-7858 • Francesca Wahl | Energy & Environment Associate |fwahl@svlg.org; 408-501-7883

The Silicon Valley 2.0 Project is a regional effort, managed by the Santa Clara County Office of Sustainability and funded by the Strategic Growth Council, to minimize the anticipated impacts of climate change and reduce the generation of local greenhouse gas emissions.

The project will use a risk management framework to: • Evaluate the exposure of community assets (i.e., infrastructure, populations, and landscapes) to

likely climate impacts, • Examine the potential consequences to the economy, society, and environment of this exposure,

and, • develop preemptive adaptation strategies that improve community resiliency.

Why does Silicon Valley need a Climate Change and Adaptation Plan? Over the next century, increasing atmospheric greenhouse gas concentrations are expected to cause a variety of changes to local climate conditions including sea level rise, increased coastal and riverine flooding, and more frequent and higher temperature extreme heat wave events. Development and implementation of climate adaptation strategies will be important to protect the region's people, infrastructure, ecosystems, and vibrant economy. What are the goals of Silicon Valley 2.0?

1. Prepare a strategic climate change adaptation plan that aims to facilitate and coordinate regional planning and implementation efforts for Silicon Valley

2. Identify assets within the region that are threatened by the anticipated climate change conditions and the magnitude of the potential economic, social, and environmental impacts that could result if no action is taken.

3. Identify potential strategies to minimize these impacts. 4. Develop a decision-support tool that will allow jurisdictions and other organizations to evaluate

potential climate change impacts and strategies within their communities 5. Ultimately, the plan will identify the region’s top priorities, and the near–term actions needed to

implement an effective regional scale adaptation response. 6. For more about the project, download the Project Description.

What is the time line for Silicon Valley 2.0? Silicon Valley 2.0 is an 18-month endevor beginning January 2013 and completing in June 2014. The project is currently in the data collection stage and held its first Stakeholder Kick off meeting on May 6, 2013. For detailed information on the project timeline, download the Project Schedule. For more information contact: Demetra J. McBride Director, Office of Sustainability and Climate Action Santa Clara County, Office of the County Executive 70 W. Hedding Street, East Wing, 11th Floor San Jose, California, 95110 Phone: (408) 299-6413 Email: demetra.mcbride@ceo.sccgov.org

Date: November 12, 2013

To: Silicon Valley Leadership Group Environment & Transportation Committees

From: Mike Mielke, VP for Environmental Programs & Policy; Shabab Hussain, Environment Coordinator

RE: Low Carbon Fuel Standard Task Force

Issue In the January 2007, Governor Schwarzenegger established a Low-Carbon Fuel Standard (LCFS) by Executive Order. This first-in-the-world greenhouse gas (GHG) standard for transportation fuels is focused on sparking research and development of alternatives to fossil fuels in order reduce reliance on oil and GHG emissions, to help comply with the California Global Warming Solutions Act. The LCFS has come under recent increased scrutiny with the advent of the Fueling California and Fooling California campaigns and the release of a number of studies. At the joint Environment and Transportation committee June meeting, members agreed the LCFS deserved special attention as it is technical and quite complex and that a taskforce should be launched to develop recommendations. SVLG Task Force

1. Launch Taskforce

2.

: The Taskforce (TF) shall develop principles to inform and guide SVLG advocacy and engagement on the issue moving forward. Timing and Scope

3.

: The TF will launch in the fall and examine the following issues: (1) Costs & impact to economy; (2) Regulatory certainty; (3) Support for market innovation; (4) Supply and demand; (5) Linkage with other programs. Reporting

4.

: The TF will provide regular updates to the Transportation and Environment Committees, with draft recommendations provided for comment and approval in spring 2014. SVLG staff

: Jessica Zenk (Transportation Director) will be the day-to-day lead contact, with Mike Mielke (Environment VP) providing support.

LCFS History & Status California’s LCFS was developed in cooperation with a number of stakeholders, including the fossil fuel and advanced transportation industries, as well as environmental NGOs. Adopted by the CA Air Resources Board (CARB) in 2009, the LCFS requires fuel providers (e.g. oil producers and importers to California) to reduce the carbon intensity of their fuel mix by at least 10% (from a 2010 baseline) by 2020. Carbon intensity refers to the full lifecycle greenhouse gas emissions associated with a specific fuel “pathway,” including the production, transport, storage, dispensing, and use of the fuel. The LCFS sets declining annual targets, starting with a 0.25% reduction in 2011, 0.5% reduction in 2012, and a 1% reduction in 2013. The speed of reduction quickens as time passes, with a 5% reduction mandated by 2017, and another 5% reduction by 2020. Regulated parties have several options to meet the standard. They can: (1) produce their own low carbon fuels; (2) buy fuels from producers to sell on the market; (3) introduce system efficiencies into their production, transportation, etc. processes to lower the carbon footprint; or, (4)purchase credits generated by others, or some combination of these strategies. Additionally, the LCFS sets up a credits market, so parties can purchase credits generated by others to come into compliance. Each credit is equal to one metric ton of carbon dioxide emitted. Exceeding the performance required by the LCFS generates credits, while using fuels with higher carbon intensity than the standard creates deficits. Background A low-carbon fuel standard (LCFS) is a rule enacted to reduce carbon intensity in transportation fuels as compared to conventional petroleum fuels, such as gasoline and diesel. The main purpose of a low-carbon fuel standard is to decrease carbon dioxide emissions associated to fuel-powered vehicles considering the entire life cycle ("well to wheels"), in order to reduce the carbon footprint of transportation. The first low-carbon fuel standard mandate in the world was enacted by California in 2007, with specific eligibility criteria defined by the California Air Resources Board (CARB) in April 2009 but taking effect until January 2011. The LCFS is a performance-based standard requiring a 10% reduction in carbon intensity of fuels by 2020. This will lead to a reduction in GHG emissions from California’s transportation sector by about 15 MMT by 2020.

2014 SVLG Environment Committee Work Plan Timeline

• August 15 – Panel of outside experts

• September 5-18 – Committee priorities survey

• September 25 – Review draft Work Plan / ROI with committee

• October 10 & 11 – Work Plan / ROI presented at Strategy Conference

• November 13 – Work Plan finalized by committee

• Dec 12 – Top priority and top accomplishments presented at Q4 SVLG Board & Annual Shareholders meeting

Silicon Valley Leadership Group

Environment Committee 2014-2016 Strategy

Mission Statement Ensure long-term environmental and business sustainability by advocating for balanced, efficient, and effective policies and programs that improve the quality of life and support business growth.

Leadership Specifically, the Environment Committee focuses the majority of its efforts in three core areas:

• Corporate sustainability – Advancing sustainable enterprise drivers to help companies save and make money in a resource constrained world.

• Water – Ensuring the region has access to safe, clean and reliable water while protecting the environment.

• Climate change – Supporting state and regional greenhouse gas emission reduction efforts and advancing strategies that will help the region adapt to a changing climate.

PRIORITY STRATEGY & MILESTONES CHAMPION(S)

Protect critical bay wetlands & advance regional flood protection Goal: Advance critical resources necessary to support Bay restoration and flood protection.

Inform strategy development

Engage in public education, and political campaigns, as appropriate

Help educate key influencers

Actively track and advance positions on key federal legislation (WRDA, etc.)

Serve on SF Bay Restoration Authority Advisory Committee

2014 Milestones: Engage member company taskforces in Q1, Q2 and Q3 to advance Baylands restoration and flood protection campaigns.

Andy Ball, Suffolk Construction

Enable corporate environmental sustainability Goal: Advance corporate sustainability drivers and showcase solutions that protect the environment while growing new markets &/or reducing costs.

Continue collecting & disseminating data points that underscore the business case for sustainability

Identify and support enabling policy and regulatory drivers

Explore P3 opportunities to scale solutions

Showcase leadership, data points, and policy/regulatory drivers at Summit

Launch executive fora series

Sustainable supply chains

2014 Milestones: Showcase case studies at Energy & Sustainability Summit; Launch CFO/CSO fora series; Explore sustainable supply chain partnership with appropriate research partner(s).

Tim Zanni, KPMG

Support state & regional climate change mitigation efforts Goal: Advance enabling environment that allows clean & efficient energy to scale.

Support BACC in scaling clean energy solutions

Help shape AB 32, including: cap & trade revenue investment and regulations such as low carbon fuel standard and carbon offsets; support thoughtful carbon market expansion

Advance state legislation that positively impacts carbon market

Inform development of AB 32 goals post 2020

Track and engage, as appropriate, around AB 32 ballot initiative 2014 Milestones: Continue engagement on BACC Exec. Committee; Launch member task force(s) on key AB 32 measures; Provide input on C&T investment; Help shape post-2020 AB 32 goals through participation in appropriate fora workshops, etc.

Raquel Gonzalez, Bank of America

Silicon Valley Leadership Group

Environment Committee 2014-2016 Strategy

PRIORITY STRATEGY & MILESTONES CHAMPION(S)

Support regional climate change planning and business resiliency Goal: Engage business community in climate change adaptation efforts.

Help shape Santa Clara County’s climate resiliency analyses

Inform Bay Area regional economic resiliency planning efforts

Build a taskforce of members to support efforts 2014 Milestones: Pending successful contract implementation, launch member working group by Q1; Provide recommendations on business resilience for a changing climate by Q4.

Jeffrey Dell, Bank of America

Promote co-equal goals of reliable water supply & ecosystem health Goal: Support Bay Delta Conservation Plan (BDCP) process.

Work with the administrations in Sacramento & Washington to ensure the BDCP is backed by robust environmental & economic data and appropriate management structures

Work with the Water District and others to ensure the BDCP supports regional needs at reasonable cost

Help educate key influencers 2014 Milestone: Engage business leaders in key BDCP decision-making processes; Convene at least once executive forum by Q3.

Andy Ball, Suffolk Construction

Advance 21st century water supply system Goal: Advance necessary water reforms, practices, policies and tools and financing to ensure the region has the water it needs for a growing population.

Continue participation in Silicon Valley Water Conservation awards

Actively track and advance positions on key state legislation.

Identify and support key mechanisms and technologies that advance improved water conservation and groundwater management

Provide input (energy-water nexus; technology development and deployment; flood protection) and engage, as appropriate, on potential water bond ballot initiative

2014 Milestones: Showcase business leadership in conservation at 2014 awards; Help pass 1 key bill; Convene one executive forum on water bond in Q1; collaborate with REAL, via water committee, on business input for bond, with recommendations provided to legislature by Q2.

Peter Nelson, CA Water

For more information, please contact

Mike Mielke | Vice President | Environmental Programs & Policy | mmielke@svlg.org | 408-501-7858

Francesca Wahl | Associate | Energy & Environment | fwahl@svlg.org | 408-501-7883.