Category: Weather

  • MIL-OSI USA: In Memoriam: Berrien Moore III [1941–2024]

    Source: NASA

    Berrien Moore III, Dean of the College of Atmospheric and Geographic Sciences at the University of Oklahoma (OU), director of the National Weather Center in Norman, OK, and Vice President for Weather and Climate Programs, died on December 17, 2024. Berrien earned an undergraduate degree from the University of North Carolina in 1963 and a doctorate degree from the University of Virginia in 1969. After graduating, he taught mathematics at the University of New Hampshire (UNH) and became tenured in 1976. 
    In 1987, Berrien became director of the Institute for the Study of Earth, Oceans, and Space (ISEOS) at UNH. NASA chose ISEOS to be one of the 24 founding members of the “Working Prototype Federation” of Earth Science Information Partners (ESIP) in 1998. Still active more than 25 years later, ESIP is now a thriving nonprofit entity funded by cooperative agreements with NASA, the National Oceanic and Atmospheric Administration (NOAA), and the U.S. Geological Survey, which brings together interdisciplinary collaborations (among over 170 partners) to share technical knowledge and engage with data users.
    Berrien left UNH in 2008, to serve as the founding Executive Director of Climate Central, a think-tank based in Princeton, NJ, which is dedicated to providing objective and understandable information about climate change
    Berrien moved to OU in 2010. Given his diverse academic, research, and career experience in global carbon cycle, biogeochemistry, remote sensing, environmental and space policy, and mathematics, Berrien was a natural choice to become the architect and principal investigator for the Geostationary Carbon Cycle Observatory (GeoCARB), a proposed NASA Earth Venture Mission that would have monitored plant health and vegetation stress throughout the Americas from geostationary orbit, probing natural sources, sinks, and exchange processes that control carbon dioxide, carbon monoxide, and methane in the atmosphere. While the mission was ultimately cancelled, the lessons learned are being applied to similar current and future Earth observing endeavors, e,g, NASA’s ECOsystem Spaceborne Thermal Radiometer Experiment on Space Station (ECOSTRESS) mission.
    Berrien served on and chaired numerous government-affiliated scientific committees throughout his career. From 1995–1998 he served on the National Research Council’s Committee on Global Change Research, which produced the landmark report, “Global Environment Change: Research Pathways for the Next Decade.” In 2011, he was an author on the National Research Council’s (NRC) decadal survey, “Earth Science and Applications from Space: A Community Assessment and Strategies for the Future.”
    Berrien participated on international scientific committees as well. From 1998–2002, he was the chair of the Science Committee of the International Geosphere Biosphere Programme (IGBP). He was also a lead author within the Intergovernmental Panel on Climate Change’s Third Assessment Report, which was released in 2001.
    Berrien served in several roles specific to NASA, including as a committee member and later chair of the organization’s Space and Earth Science Advisory Committee. He served as Chair of the Earth Observing System (EOS) Payload Advisory Committee, member and Chair of NASA’s Earth Science and Applications Committee, and member of the NASA Advisory Council. He was also active at NOAA, having chaired the agency’s Research Review Team and served on the Research and Development Portfolio Review Team for NOAA’s Science Advisory Board. 
    Berrien received NASA’s highest civilian honor, the Distinguished Public Service Medal, for outstanding service and the NOAA Administrator’s Recognition Award. He also received the 2007 Dryden Lectureship in Research Medal from the American Institute of Aeronautics and Astronautics and was honored for his contributions to the IPCC when the organization received the 2007 Nobel Peace Prize.

    MIL OSI USA News

  • MIL-OSI USA: In Memoriam: Pierre Morel [1933–2024]

    Source: NASA

    Pierre Morel, the first director of the World Climate Research Programme (WCRP) and founding member of WCRP’s Global Energy and Water Exchanges (GEWEX) Core project, died on December 10, 2024.
    Pierre began his research as a theoretical physicist. His doctoral thesis examined the existence and properties of a condensed superfluid state of liquid Helium 3 at very low temperature. He lectured on basic physics, geophysical fluid dynamics, and climate science. As his career progressed, he focused his research on studying the circulation of the atmosphere. He was devoted to the development of numerical modelling of atmospheric flow that laid the groundwork for the study of climatology.
    Pierre’s work played an integral role in the development of tools used to study the atmosphere, many of which are still active today. Examples include Project Éole – an experimental wind energy plant conceived in the 1980s and created in Quebec, Canada that closed down in 1993; the ARGOS satellite, a collaboration between the Centre National d’Études Spatiale (CNES) [French Space Agency], National Oceanic and Atmospheric Administration (NOAA), and NASA, to collect and relay meteorological and oceanographic data around the world that launched in 1978; the Search and Rescue Satellite Aided Tracking (SARSAT) system, which was developed by the U.S. – specifically NOAA, NASA, and the U.S. Coast Guard and Air Force – Canada, and France, with the first satellite launch in 1982; and the European Organization for the Exploitation of Meteorological Satellites’ METEOSAT series of geostationary satellites, which launched in 1977 and remain active today. The launch of Meteosat–12 in 2022 was the first METEOSAT Third Generation (MTG) launch.
    Early in his career, Pierre was the director of the French Laboratoire de Météorologie Dynamique (LMD) before he became the director of the Centre National d’Études Spatiales (CNES). In 1980 he became the first chairman of the WCRP, where he steered a broad interdisciplinary research program in global climate and Earth system science that involved the participation of atmospheric, oceanic, hydrological, and polar scientists worldwide. Pierre was later in charge of planetary programs at NASA and was involved in discussions about the future of NASA’s Earth Observing System (EOS) in the mid-to-late 1990s. As an example, the Earth Observer article, “Minutes Of The Fourteenth Earth Science Enterprise/Earth Observing System (ESE/EOS) Investigators Working Group Meeting,” includes a summary of a presentation Pierre gave that focused on flight mission planning for the EOS “second series,” which was NASA’s plan at the time although ultimately not pursued, with the “first series” (i.e., Terra, Aqua, Aura) enduring much longer than anticipated.
    Pierre was the recipient of the 2008 Alfred Wegener Medal & Honorary Membership for his outstanding contributions to geophysical fluid dynamics, his leadership in the development of climate research, and the applications of space observation to meteorology and the Earth system science.

    MIL OSI USA News

  • MIL-OSI USA: Summary of the Joint NASA LCLUC–SARI Synthesis Meeting

    Source: NASA

    Introduction
    The NASA Land-Cover and Land-Use Change (LCLUC) is an interdisciplinary scientific program within NASA’s Earth Science program that aims to develop the capability for periodic global inventories of land use and land cover from space. The program’s goal is to develop the mapping, monitoring and modeling capabilities necessary to simulate the processes taking place and evaluate the consequences of observed and predicted changes. The South/Southeast Asia Research Initiative (SARI) has a similar goal for South/Southeast Asia, as it seeks to develop innovative regional research, education, and capacity building programs involving state-of-the-art remote sensing, natural sciences, engineering, and social sciences to enrich land use/cover change (LUCC) science in South/Southeast Asia. Thus it makes sense for these two entities to periodically meet jointly to discuss their endeavors.
    The latest of these joint meetings took place January 1–February 2, 2024, in Hanoi, Vietnam. A total of 85 participants attended the three-day, in-person meeting—see Photo.  A total of 85 participants attended the three-day, in-person meeting. The attendees represented multiple international institutions, including NASA (Headquarters and Centers), the University of Maryland, College Park (UMD), other American academic institutions, the Vietnam National Space Center (VNSC, the event host), the Vietnam National University’s University of Engineering and Technology, and Ho Chi Minh University of Technology, the Japanese National Institute of Environmental Studies (NIES), Center for Environmental Sciences, and the University of Tokyo. In addition, several international programs participated, including GEO Global Agricultural Monitoring (GEOGLAM), the System for Analysis, Research and Training (START), Global Observation of Forest and Land-use Dynamics (GOFC–GOLD), and NASA Harvest.

    Meeting Overview
    The purpose of the 2024 NASA LCLUC–SARI Synthesis meeting was to discuss LUCC issues – with a particular focus on their impact on Southeast Asian countries. Presenters highlighted ongoing projects aimed to advance our understanding of the spatial extent, intensity, social consequences, and impacts on the environment in South/Southeast Asian countries. While presenters reported on specific science results, they also were intentional to review and synthesize work from other related projects going on in Southeast Asia. 
    Meeting Goal
    The meeting’s overarching goal was to create a comprehensive and holistic understanding of various LUCC issues by examining them from multiple angles, including: collating information; employing interdisciplinary approaches; integrating research; identifying key insights; and enhancing regional collaborations. The meeting sought to bring the investigators together to bridge gaps, promote collaborations, and advance knowledge regarding LUCC issues in the region. The meeting format also provided ample time between sessions for networking to promote coordination and collaboration among scientists and teams. 
    Meeting and Summary Format
    The meeting consisted of seven sessions that focused on various LUCC issues. The summary report that follows is organized by day and then by session. All presentations in Session I and II are summarized (i.e., with all speakers, affiliations, and appropriate titles identified). The keynote presentation(s) from Sessions III–VI are summarized similarly. The technical presentations in each of these sessions are presented as narrative summaries. Session VII consisted of topical discussions to close out the meeting and summaries of these discussions are included herein. Sessions III–VI also included panel discussions, but to keep the article length more manageable, summaries of these discussions have been omitted. Readers interested in learning more about the panel discussions or viewing any of these presentations in full can access the information on the Joint LCLUC–SARI Synthesis meeting website.
    DAY ONE
    The first day of the meeting included welcoming remarks from the U.S. Ambassador to Vietnam (Session I), program executives of LCLUC and SARI,  as well as from national space agencies in South and Southeast Asia (Session II), and other LCLUC-thematic/overview presentations (Session III).
    Session 1: Welcoming Remarks
    Garik Gutman [NASA Headquarters—LCLUC Program Manager], Vu Tuan [VNSC’s Vietnam Academy of Science and Technology (VAST)—Vice Director General], Chris Justice [University of Maryland, College Park (UMD)—LCLUC Program Scientist], Matsunaga Tsuneo [National Institute of Environmental Studies (NIES), Japan], and Krishna Vadrevu [NASA’s Marshall Space Flight Center—SARI Lead] delivered opening remarks that highlighted collaborations across air pollution, agriculture, forestry, urban development, and other LUCC research areas. While each of the speakers covered different topics, they emphasized common themes, including advancing new science algorithms, co-developing products, and fostering applications through capacity building and training.
    After the opening remarks, special guest Marc Knapper [U.S. Ambassador to Vietnam] gave a presentation in which he emphasized the value of collaborative research between U.S. and Vietnamese scientists to address environmental challenges – especially climate change and LUCC issues. He expressed appreciation to the meeting organizers for promoting these collaborations and highlighted the joint initiatives between NASA and the U.S. Agency for International Development (USAID) to monitor environmental health and climate change, develop policies to reduce emissions, and support adaptation in agriculture. The U.S.–Vietnam Comprehensive Strategic Partnership emphasizes the commitment to address climate challenges and advance bilateral research. He concluded by encouraging active participation from all attendees and stressed the need for ongoing international collaboration to develop effective LUCC policies.
    Session-II: Programmatic and Space Agency Presentations
    NOTE: Other than Ambassador Knapper, the presenters in Session I gave welcoming remarks and programmatic and/or space agency presentations in Session II,.
    Garik Gutman began the second session by presenting an overview of the LCLUC program, which aims to enhance understanding of LUCC dynamics and environmental implications by integrating diverse data sources (i.e., satellite remote sensing) with socioeconomic and ecological datasets for a comprehensive view of land-use change drivers and consequences. Over the past 25 years, LCLUC has funded over 325 projects involving more than 800 researchers, resulting in over 1500 publications. The program’s focus balances project distribution that spans detection and monitoring, and impacts and consequences, including drivers, modeling, and synthesis. Gutman highlighted examples of population growth and urban expansion in Southeast Asia, resulting in environmental and socio-economic impacts. Urbanization accelerates deforestation, shifts farming practices to higher-value crops, and contributes to the loss of wetlands. This transformation alters the carbon cycle, degrades air quality, and increases flooding risks due to reduced rainwater absorption. Multi-source remote sensing data and social dimensions are essential in addressing LUCC issues, and the program aims to foster international collaborations and capacity building in land-change science through partnerships and training initiatives. (To learn more about the recent activities of the LCLUC Science Team, see Summary of the 2024 Land Cover Land Use Change Science Team Meeting.)
    Krishna Vadrevu explained how SARI connects regional and national projects with researchers from the U.S. and local institutions to advance LUCC mapping, monitoring, and impact assessments through shared methodologies and data. The initiative has spurred extensive activities, including meetings, training sessions, publications, collaborations, and fieldwork. To date, the LCLUC program has funded 35 SARI projects and helped build collaborations with space agencies, universities, and decision-makers worldwide. SARI Principal Investigators have documented notable land-cover and land-use transformations, observing shifts in land conversion practices across Asia. For example, the transition from traditional slash-and-burn practices for subsistence agriculture to industrial oil palm and rubber plantations in Southeast Asia. Rapid urbanization has also reshaped several South and Southeast Asian regions, expanding both horizontally in rural areas and vertically in urban centers. The current SARI solicitation funds three projects across Asia, integrating the latest remote sensing data and methods to map, monitor, and assess LUCC drivers and impacts to support policy-making.
    Vu Tuan provided a comprehensive overview of Vietnam’s advances in satellite technology and Earth observation capabilities, particularly through the LOTUSat-1 satellite (name derived from the “Lotus” flower), which is equipped with an advanced X-band Synthetic Aperture Radar (SAR) sensor capable of providing high-resolution imagery [ranging from 1–16 m (3–52 ft)]. This satellite is integral to Vietnam’s efforts to enhance disaster management and climate change mitigation, as well as to support a range of applications in topography, agriculture, forestry, and water management, as well as in oceanography and environmental monitoring. The VNSC’s efforts are part of a broader strategy to build national expertise and self-reliance in satellite technology, such as developing a range of small satellites (e.g., NanoDragon, PicoDragon, and MicroDragon) that progress in size and capability. Alongside satellite development, the VNSC has established key infrastructure, facilities, and capacity building in Hanoi, Nha Trang, and Ho Chi Minh City to support satellite assembly, integration, testing, and operation. Tuan showcased the application of remotely sensed LUCC data to map and monitor urban expansion in Ha Long city from 2000–2023 and the policies needed to manage these changes sustainably – see Figure 1.

    Tsuneo Matsunaga provided a detailed overview of Japan’s Greenhouse Gases Observing Satellite (GOSAT) series of satellites, data from which provide valuable insights into global greenhouse gas (GHG) trends and support international climate agreements, including the Paris Agreement.
    Matsunaga reviewed the first two satellites in the series: GOSAT and GOSAT-2, then previewed the next satellite in the series: GOSAT-GW, which is scheduled to launch in 2025. GOSAT-GW will fly the Total Anthropogenic and Natural Emissions Mapping Observatory–3 (TANSO-3) – an improved version of TANSO-2, which flies on GOSAT-2. TANSO-3 includes a Fourier Transform Spectrometer (FTS-3) that has improved spatial resolution [10.5 km (6.5 mi)] over TANSO-FTS-2 and precision that matches or exceeds that of its predecessor. TANSO-FTS-3 will allow estimates with precision better than 1 ppm for carbon dioxide (CO2) and 10 ppb for methane (CH4), as well as enabling nitrogen dioxide (NO2) measurements. GOSAT–GW will also fly the Advanced Microwave Scanning Radiometer (AMSR3) that will monitor water cycle components (e.g., precipitation, soil moisture) and ocean surface winds. AMSR3 builds on the heritage of three previous AMSR instruments that have flown on NASA and Japan Aerospace Exploration Agency (JAXA) missions.
    Matsunaga also highlighted the importance of ground-based validation networks, such as the Total Carbon Column Observing Network, COllaborative Carbon Column Observing Network, and the Pandora Global Network, to ensure satellite data accuracy.
    Son Nghiem [NASA/Jet Propulsion Laboratory (JPL)] addressed dynamic LUCC in Cambodia, Laos, Thailand, Vietnam, and Malaysia. The synthesis study examined the factors that evolve along the rural–urban continuum (RUC). Nghiem showcased this effort using Synthetic Aperture Radar (SAR) data from the Copernicus Sentinel-1 mission to map a typical RUC in Bac Lieu, Vietnam – see Figure 2.

    Nghiem described the study, which examined the role of rapid urbanization, agricultural conversion, climate change, and environment–human feedback processes in causing non-stationary and unpredictable impacts. This work illustrates how traditional trend analysis is insufficient for future planning. The study also examined whether slower or more gradual changes could inform policy development. To test these hypotheses, his research will integrate high-resolution radar and hyperspectral data with socioeconomic analyses. The study highlights the need for policies that are flexible and responsive to the unique challenges of different areas, particularly in “hot-spot” regions experiencing rapid changes.
    Peilei Fan [Tufts University] presented a study that synthesizes the complex patterns of LUCC, identifying both the spatial and temporal dynamics that characterize transitions in urban systems. The study explores key drivers, including economic development, population growth, urbanization, agricultural expansion, and policy shifts. She emphasized the importance of understanding these drivers for sustainable land management and urban planning. For example, the Yangon region of Myanmar has undergone rapid urbanization – see Figure 3. Her work reveals the need for integrated approaches that consider both urban and rural perspectives to manage land resources effectively and mitigate negative environmental and social impacts. Through a combination of case studies, statistical analysis, and policy review, Fan and her team aim to provide a nuanced understanding of the interactions between human activities and environmental changes occurring in the rapidly transforming landscapes of Southeast Asia.

    Session III: Land Cover/Land Use Change Studies
    Tanapat Tanaratkaittikul [Geo-Informatics and Space Technology Development Agency (GISTDA), Thailand] highlighted GISTDA activities, which play a crucial role in advancing Thailand’s technological capabilities and addressing both national and global challenges, including Thailand Earth Observation System (THEOS) and its successors: THEOS-2 and THEOS-2A. THEOS-1, which launched in 2008, provides 2-m (6-ft) panchromatic and 15-m (45-ft) multispectral resolution with a 26-day revisit cycle, which can be reduced to 3 days with off-nadir pointing. Launched in 2023, THEOS-2 includes two satellites – THEOS-2A [a very high-resolution satellite with 0.5-m (1.5-ft) panchromatic and 2-m (6-ft) multispectral imagery] and THEOS-2B [a high-resolution satellite with 4-m (12-ft) multispectral resolution] – with a five-day revisit cycle. GISTDA also develops geospatial applications for drought assessment, flood prediction, and carbon credit calculations to support government decision-making and climate initiatives. GISTDA partners with international collaborators on regional projects, such as the Lancang-Mekong Cooperation Special Fund Project.
    Eric Vermote [NASA’s Goddard Space Flight Center] presented a keynote that focused on atmospheric correction of land remote sensing data and related algorithm updates. He highlighted the necessity of correcting surface imaging for atmospheric effects, such as molecular scattering, aerosol scattering, and gaseous absorption, which can significantly distort the satellite spectral signals and lead to potential errors in applications, such as land cover mapping, vegetation monitoring, and climate change studies.
    Vermote explained that the surface reflectance algorithm uses precise vector radiative transfer modeling to improve accuracy by incorporating atmospheric parameter inversion. It also adjusts for various atmospheric conditions and aerosol types – enhancing corrections across regions and seasons. He explained that SkyCam – a network of ground-based cameras – provides real-time assessments of cloud cover that can be used to validate cloud masks, while the Cloud and Aerosol Measurement System (CAMSIS) offers additional ground validation by measuring atmospheric conditions. He said that together, SkyCam and CAMSIS improve satellite-derived cloud masks, supporting more accurate climate models and environmental monitoring. Vermote’s work highlights the ongoing advancement of atmospheric correction methods in remote sensing.
    Other presentations in this session included one in which the speaker described how Yangon, the capital city in Myanmar, is undergoing rapid urbanization and industrial growth. From 1990–2020, the urban area expanded by over 225% – largely at the expense of agricultural and green lands. Twenty-nine industrial zones cover about 10.92% of the city, which have attracted significant foreign direct investment, particularly in labor-intensive sectors. This growth has led to challenges with land confiscations, inadequate infrastructure, and environmental issues (e.g., air pollution). Additionally, rural migration for employment has resulted in informal settlements, emphasizing the need for comprehensive urban planning that balances economic development with social equity and sustainability.
    Another presentation highlighted varying LUCC trends across Vietnam. In the Northern and Central Coastal Uplands, for example, swidden systems are shifting toward permanent tree crops, such as rubber and coffee. Meanwhile, the Red River Delta is seeing urban densification and consolidation of farmland – transitioning from rice to mixed farming with increased fruit and flower production. Similarly, the Central Coastal Lowlands and Southeastern regions are experiencing urban growth and a shift from coastal agriculture – in this case, to shrimp farming – leading to mangrove loss. The Central Highlands is moving from swidden to tree crops, particularly fruit trees, while the Mekong River Delta is increasing rice cropping and aquaculture. These changes contribute to urbanization, altered farming practices, and biodiversity loss. Advanced algorithms (e.g., the Time-Feature Convolutional Neural Network model) are being used to effectively map these varied LUCC changes in Vietnam.
    Another presenter explained how 10-m (33-ft) resolution spatially gridded population datasets are essential to address LUCC in environmental and socio-demographic research. There was also a demonstration of PopGrid, which is a collaborative initiative that provides access to various global-gridded population databases, which are valuable for regional LUCC studies and can support informed decision-making and policy development.
    DAY TWO
    The second day’s presentations centered around urban LUCC (Session IV) as well as interconnections between agriculture and water resources. (Session V).
    Session IV: Urban Land Cover/Land Use Change
    Gay Perez [Philippines Remote Sensing Agency (PhilSA)] presented a keynote focused on PhilSA’s mission to advance Philippines as a space-capable country by developing indigenous satellite and launch technologies. He explained that PhilSA provides satellite data in various categories, including sovereign, commercial, open-access, and disaster-activated. He noted that the ground infrastructure – which includes three stations and a new facility in Quezon – supports efficient data processing. For example, Perez stated that in 2023, PhilSA produced over 10,000 maps for disaster relief, agricultural assessments, and conservation planning.
    Perez reviewed PhilSA’s Diwata-2 mission, which launched in 2018 and operates in a Sun-synchronous orbit around 620 km (385 mi) above Earth. With a 10-day revisit capability, it features a high-precision telescope [4.7 m (15ft) resolution], a multispectral imager with four bands, an enhanced resolution camera, and a wide-field camera. Since launch, Diwata-2 has captured over 100,000 global images, covering 95% of the Philippines. Looking to the near future, Perez reported that PhilSA’s launch of the Multispectral Unit for Land Assessment (MULA) satellite is planned for 2025. He explained that MULA will capture images with a 5-m (~16-ft) resolution and 10–20-day revisit time, featuring 10 spectral bands for vegetation, water, and urban analysis.
    Perez also described the Drought and Crop Assessment and Forecasting project, which addresses drought risks and mapping ground motion in areas, e.g., Baguio City and Pangasinan. Through partnerships in the Pan-Asia Partnership for Geospatial Air Pollution Information (PAPGAPI) and the Pandora Asia Network, PhilSA monitors air quality across key locations, tracking urban pollution and cross-border particulate transport. PhilSA continues to strengthen Southeast Asian partnerships to drive sustainable development in the region.
    Jiquan Chen [Michigan State University] presented the second keynote address, which focused on the Urban Rural Continuum (URC). Chen emphasized the importance of synthesizing studies that explore factors such as population dynamics, living standards, and economic development in the URC. Key considerations include differentiating between two- and three-dimensional infrastructures and understanding constraints from historical contexts. Chen highlighted critical variables from his analysis including net primary productivity, household income, and essential infrastructure elements, such as transportation and healthcare systems. He advocated for integrated models that combine mechanistic and empirical approaches to grasp the dynamics of URC changes, stressing their implications for urban planning, environmental sustainability, and social equity. He concluded with a call for collaboration to enhance these models and tackle challenges arising from the changing urban–rural landscape.
    Tep Makathy [Cambodian Institute For Urban Studies] discussed urbanization in Phnom Penh, Cambodia. He explained that significant LUCC and infrastructure developments have been fueled by direct foreign investment; however, this development has resulted in environmental degradation, urban flooding, and infrastructure strain. Tackling pollution, congestion, preservation of green spaces, and preserving the historical heritage of the city will require sustainable urban planning efforts.
    Nguyen Thi Thuy Hang [Vietnam Japan University, Vietnam National University, Hanoi] explained how flooding poses a significant annual threat to infrastructure and livelihoods in Can Tho, Vietnam. Therefore, it is essential to incorporate climate change considerations into land-use planning by enhancing the accuracy of vegetation layer classifications. Doing so will improve the representation of land-cover dynamics in models that decision-makers use when planning urban development. In addition, Hang reported that a more comprehensive survey of dyke systems will improve flood protection and identify areas needing reinforcement or redesign. These studies could also explore salinity intrusion in coastal agricultural areas that could impact crop yields and endanger food security.
    In this session, two presenters highlighted how SAR data, which uses high backscatter to enhance the radar signal, is being used to assist with mapping urban areas in their respective countries. The phase stability and orientation of building structures across SAR images aid in consistent monitoring and backscatter, producing distinct image textures specific to urban settings. Researchers can use this heterogeneity and texture to map urban footprints, enabling automated discrimination between urban and non-urban areas. The first presenters showed how Interferometric Synthetic Aperture Radar techniques, such as Small Baseline Subset (SBAS) and Persistent Scatterer (PS) have been highly effective for mapping and monitoring land subsidence in coastal and urban areas in Vietnam. This approach has been applied to areas along the Saigon River as well as in Ho Chi Minh, Vietnam. The second presenter described an approach (using SAR data with multitemporal coherence and the K-means classification method) that has been used effectively to study urban growth in the Denpasar Greater Area of Indonesia between 2016 and 2022. The technique identified the conversion of 4376 km2 (1690 mi2) of rural to built-up areas, averaging 72.9 hectares (0.3 mi2) per year. Urban sprawl was predominantly observed in the North Kuta District, where the shift from agricultural to built-up land use has been accompanied by severe traffic congestion and other environmental issues.
    Another presenter showed how data from the QuikSCAT instrument, which flew on the Quick Scatterometer satellite, and from the Sentinel-1 C-band SAR can be combined to measure and analyze urban built-up volume, specifically focusing on the vertical growth of buildings across various cities. By integrating these datasets, researchers can assess urban expansion, monitor the development of high-rise buildings, and evaluate the impact of urbanization on infrastructure and land use. This information is essential for urban planning, helping city planners and policymakers make informed decisions to accommodate growing populations and enhance sustainable urban development.
    Session V – LUCC, Agriculture, and Water Resources
    Chris Justice presented the keynote for this session, in which he addressed the GEOGLAM initiative and the NASA Harvest program. GEOGLAM, initiated by the G20 Agriculture Ministers in 2011, focuses on agriculture and food security to increase market transparency and improve food security. These efforts leverage satellite-based Earth observations to produce and disseminate timely, relevant, and actionable information about agricultural conditions at national, regional, and global scales to support agricultural markets and provide early warnings for proactive responses to emerging food emergencies. NASA Harvest uses satellite Earth observations to benefit global food security, sustainability, and agriculture for disaster response, climate risk assessments, and policy support. Justice also emphasized the use of open science and open data principles, promoting the integration of Earth observation data into national and international agricultural monitoring systems. He also discussed the development and application of essential agricultural variables, in situ data requirements, and the need for comprehensive and accurate satellite data products.
    During this session, another presentation focused on how VNSC is engaged in several agricultural projects, including mapping rice crops, estimating yields, and assessing environmental impacts. VNSC has created high-accuracy rice maps for different seasons that the Vietnamese government uses to monitor and manage agricultural production. Current initiatives involve using satellite data to estimate CH4 emissions from rice paddies, biomass mapping, and monitoring rice straw burning. For example, in the Mekong Delta, numerous environmental factors, including climate change-induced stress (e.g., sea-level rise), flooding, drought, land subsidence, and saltwater intrusion, along with human activities like dam construction, sand mining, and groundwater extraction, threaten the sustainability of rice farming and farmer livelihoods. To address these challenges, sustainable agricultural practices are essential to improving rice quality, diversify farming systems, adopt low-carbon techniques, and enhance water management.
    Presentations highlighted the importance of both optical and SAR data for LUCC studies, particularly in mapping agricultural areas. A study using Landsat time-series data demonstrated its value in monitoring agricultural LUCC in Houa Phan Province, Laos, and Son La Province, Vietnam. Land cover types were classified through spectral pattern analysis, identifying distinct classes based on Landsat reflectance values. The findings revealed significant natural forest loss alongside increases in cropland and forest plantations due to agricultural expansion. High-resolution imagery validated these results, indicating the scalability of this approach for broader regional and global land-cover monitoring. Another study showcased the effectiveness of SAR data from the Phased Array type L-band Synthetic Aperture Radar-2 (PALSAR-2) on the Japanese Advanced Land Observing Satellite-2 (ALOS-2) for mapping and monitoring agricultural land use in Suphanburi, Thailand. This data proved particularly useful for capturing seasonal variations and diverse agricultural practices. Supervised machine learning methods, such as Random Forest classifiers, combined with innovative spatial averaging techniques, achieved high accuracy in distinguishing various agricultural conditions.
    In the session, presenters also discussed the use of Sentinel-1 SAR data for mapping submerged and non-submerged paddy soils was highlighted, demonstrating its effectiveness in understanding water management issues see – Figure 4. Additionally, large-scale remote sensing data and cloud computing were shown to provide unprecedented opportunities for tracking agricultural land-use changes in greater detail. Case studies from India and China illustrated key challenges, such as groundwater depletion in irrigated agriculture across the Indo-Ganges region and the impacts on food, water, and air quality in both countries.

    The session also focused on Water–Energy–Food (WEF) issues related to the Mekong River Basin’s extensive network of hydroelectric dams, which present both benefits and challenges. While these dams support sectors such as irrigated agriculture and hydropower, they also disrupt vital ecosystem services, including fish habitats and biodiversity. Collaborative studies integrating satellite and ground data, hydrological models, and socio-economic frameworks highlight the need to balance these benefits with ecological and social costs. Achieving sustainable management requires cross-sectoral and cross-border cooperation, as well as the incorporation of traditional knowledge to address WEF trade-offs and governance challenges in the region.
    DAY THREE
    The third day included a session that explored the impacts of fire, GHG emissions, and pollution (Session VI) as well as a summary discussion on synthesis (Session VII).
    Session VI: Fires, Greenhouse Gas Emissions, and Pollution
    Chris Elvidge [Colorado School of Mines] presented a keynote on the capabilities and applications of the Visible Infrared Imaging Radiometer Suite (VIIRS) Nightfire [VNF] system, an advanced satellite-based tool developed by the Earth Observation Group. VIIRS Nightfire uses four near- and short-wave infrared channels, initially designed for daytime imaging, to detect and monitor infrared emissions at night. The system identifies various combustion sources, including both flaming and non-flaming activities (e.g., biomass burning, gas flaring, and industrial processes). It calculates the temperature, source area, and radiant heat of detected infrared emitters using physical laws to enable precise monitoring of combustion events and provide insight into exothermic and endothermic processes.
    Elvidge explained that VNF has been vital for near-real-time data in Southeast Asia. The system has been used to issue daily alerts for Vietnam, Thailand, and Indonesia. Recent updates in Version 4 (V4) include atmospheric corrections and testing for secondary emitters with algorithmic improvements – with a 50% success rate in identifying additional heat sources. The Earth Observation Group maintains a multiyear catalog of over 20,000 industrial infrared emitters available through the Global Infrared Emitter Explorer (GIREE) web-map service. With VIIRS sensors expected to operate until about 2040 on the Joint Polar Satellite System (JPSS) platforms, this system ensures long-term, robust monitoring and analysis of global combustion events, proving essential for tracking the environmental impacts of industrial activities and natural combustion processes on the atmosphere and ecosystems.
    Toshimasa Ohara [Center for Environmental Science, Japan—Research Director] continued with the second keynote and provided an in-depth analysis of long-term trends in anthropogenic emissions across Asia. The regional mission inventory in Asia encompasses a range of pollutants and offers detailed emissions data from 1950–2020 at high spatial and temporal resolutions. The study employs both bottom-up and top-down approaches for estimating emissions, integrating satellite observations to validate data and address uncertainties. Notably, emissions from China, India, and Japan have shown signs of stabilization or reduction, attributed to stricter emission control policies and technological advancements. Ohara also highlighted Japan’s effective air pollution measures and the importance of extensive observational data in corroborating emission trends. His presentation emphasized the need for improved methodologies in emission inventory development and validation across Asia, aiming to enhance policymaking and environmental management in rapidly industrializing regions.
    Several presenters during this session focused on innovative approaches to understand and mitigate GHG emissions and air pollution. One presenter showed how NO2 data from the TROPOspheric Monitoring Instrument (TROPOMI) on the European Sentinel-5 Precursor have been validated against ground-based observations from Pandora stations in Japan, highlighting the influence of atmospheric conditions on measurement accuracy. Another presenter described an innovative system that GISTDA used to combine satellite remote sensing data with Artificial Intelligence (AI). This system was used to monitor and analyze the concentration of fine particulate matter (PM) in the atmosphere in Thailand. (In this context fine is defined as particles with diameters ≤ 2.5 µm, or PM2.5.) These applications, which are accessible through online, cloud-based platforms and mobile applications for iOS and Android devices, allow users, including citizens, government officers, and policymakers, to access PM2.5 data in real-time through web and mobile interfaces.
    A project under the United Nations Economic and Social Commission for Asia and the Pacific in Thailand is focused on improving air quality monitoring across the Asia–Pacific region by integrating satellite and ground-based data. At the core of this effort, the Pandora Asia Network, which includes 30 ground-based instruments measuring pollutants such as NO₂ and sulfur dioxide (SO₂), is complemented by high-resolution observations from the Geostationary Environment Monitoring Spectrometer (GEMS) aboard South Korea’s GEO-KOMPSAT-2B (GK-2B) satellite. The initiative also provides training sessions to strengthen regional expertise in remote sensing technologies for air quality management and develops decision support systems for evidence-based policymaking, particularly for monitoring pollution sources and transboundary effects like volcanic eruptions. Future plans include expanding the Pandora network and enhancing data integration to support local environmental management practices.
    PM2.5 levels in Vietnam are influenced by both local emissions and long-range pollutant transport, particularly in urban areas.The Vietnam University of Engineering and Technology, in conjunction with VNSC, continues to map and monitor PM2.5 using satellites and machine learning while addressing data quality issues that stem from missing satellite data and limited ground monitoring stations – see Figure 5.
    In addition to mapping and monitoring pollutants, another presentater explained that significant research is underway to address their health impacts. In Hanoi, exposure to pollutants ( e.g., PM2.5, PM10, and NO2) has led to increased rates of respiratory diseases (e.g., pneumonia, bronchitis, and asthma) among children,  as well as elevated instances of cardiovascular diseases among adults. A substantial mortality burden is attributable to fine particulate matter – particularly in densely populated areas like Hanoi. Compliance with stricter air quality guidelines could potentially prevent thousands of premature deaths. For example, preventive measures enacted during the COVID-19 pandemic resulted in reduced pollution levels that were associated with a decrease in avoidable mortality rates. In response to these challenges, Vietnam has implemented air quality management policies, including national technical regulations and action plans aimed at controlling emissions and enhancing monitoring; however, current national standards still fall short of the more stringent guidelines recommended by the World Health Organization. Improved air quality standards and effective policy interventions are needed to mitigate the health risks associated with air pollution in Vietnam.

    Another presenter explained how food production in Southeast Asia contributes about 40% of the region’s total GHG emissions – with rice and beef production identified as the largest contributors for plant-based and animal-based emissions, respectively. Another presentation focused on a study that examined GHG emissions from agricultural activities, which suggests that animal-based food production – particularly beef – generates substantially higher GHG emissions per kg of food produced compared to plant-based foods, such as wheat and rice. Beef has an emission intensity of about 69 kg of CO2 equivalent-per-kg, compared to 2 to 3 kg of CO2 equivalent-per-kg for plant-based foods. The study points to mitigation strategies (e.g., changing dietary patterns, improving agricultural practices) and adopting sustainable land management. Participants agreed that a comprehensive policy framework is needed to address the environmental impacts of food production and reduce GHG emissions in the agricultural sector.
    In another presentation, the speaker highlighted the fact that Southeast Asian countries need an advanced monitoring, reporting, and verification system to track GHG emissions – particularly within high-carbon reservoirs like rice paddies. To achieve this, cutting-edge technologies (e.g., satellite remote sensing, low-cost unmanned aerial vehicles, and Internet of Things devices) can be beneficial in creating sophisticated digital twin technology for sustainable rice production and GHG mitigation.
    Another presentation featured a discussion about pollution resulting from forest and peatland fires in Indonesia, which is significantly impacting air quality. Indonesia’s tropical peatlands – among the world’s largest and most diverse – face significant threats from frequent fires. Repeated burning has transformed forests into shrubs and secondary vegetation regions, with fires particularly affecting forest edges and contributing to a further retreat of intact forest areas. High-resolution data is essential to map and monitor changes in forest cover, including pollution impacts.
    Another speaker described a web-based Geographic Information Systems (GIS) application that has been developed to support carbon offsetting efforts in Laos – to address significant environmental challenges, e.g., deforestation and climate change. Advanced technologies (e.g., remote sensing, GIS, and Global Navigation Satellite Systems) are used to monitor land-use changes, carbon sequestration, and ecosystem health. By integrating various spatial datasets, the web GIS app enhances data collection precision, streamlines monitoring processes, and provides real-time information to stakeholders for informed decision-making. This initiative fosters collaboration among local communities, government agencies, and international partners, while emphasizing the importance of government support and international partnerships. Ultimately, the web GIS application represents a significant advancement in Laos’s commitment to environmental sustainability, economic growth, and the creation of a greener future.
    Session VII. Discussion Session on Synthesis
    The meeting concluded with a comprehensive discussion on synthesizing themes related to LUCC. The session focused on three themes: LUCC, agriculture, and air pollution. The session focused on trends and projections as well as the resulting impacts in the coming years. It also highlighted research related to these topics to inform more sustainable land use policies. A panel of experts from different Southeast Asian countries addressed these topics. A summary of the key points shared by the panelists for each theme during the discussion is provided below.
    LUCC Discussions
    This discussion focused on the challenges of balancing economic development with environmental sustainability in Southeast Asian countries, e.g., mining in Myanmar, agriculture in Vietnam, and rising land prices in Thailand. More LUCC research is needed to inform decision-making and improve land-use planning during transitions from agriculture to industrialization while ensuring food security. The panelists also discussed urban sprawl and infrastructure development along main roads in several Southeast Asian countries, highlighting the social and environmental challenges arising from uncoordinated growth. It was noted that urban infrastructure lags behind population increases, resulting in traffic congestion, pollution, and social inequality. Cambodia, for example, has increased foreign investments, which presents similar dilemmas of economic growth accompanied by significant environmental degradation. Indonesia is another example of a Southeast Asian nation facing rapid urbanization and inadequate spatial planning, leading to flooding, groundwater depletion, and pollution. These issues further highlight the need for integrated satellite monitoring to inform land-use policies. Finally, recognizing the importance of public infrastructure in growth management, it was reported that the Thai government is already using technology to manage urban development alongside green spaces.
    Panelists agreed that LUCC research is critical for guiding policymakers toward sustainable land-use practices – emphasizing the necessity for improved communication between researchers and policymakers. While the integration of technologies (e.g., GIS and remote sensing) is beginning to influence policy decisions, room for improvement remains. In summary, the discussions stressed the importance of better planning, technology integration, and policy-informed research to reconcile economic growth with sustainability. Participants also highlighted the need to engage policymakers, non-government organizations, and the private sector in using scientific evidence for sustainable development. Capacity building in Laos, Cambodia, and Myanmar, where GIS and remote sensing technologies are still developing, is crucial. Community involvement is essential for translating research findings into actionable policies to address real-world challenges and social equity.
    Agriculture Discussions
    These discussions explored the intricate relationships between agricultural practices, economic growth, and environmental sustainability in Southeast Asia. As an example, despite national policies to manage the land transition in Vietnam, rapid conversions from forest to agricultural land and further to residential and industrial continue. While it is recognized that strict land management plans may hinder future adaptability, further regulation is needed. These rapid shifts in land use have increased land for economic development – especially in industrial and residential sectors – and contribute to environmental degradation, e.g., pollution and soil erosion. In Thailand, land is distributed among agriculture (50%), forest (30%), and urban (20%) areas. Despite a long history of agricultural practices, Vietnam faces new challenges from climate change and extreme weather.
    Thailand, meanwhile, is exploring carbon credits to incentivize sustainable farming practices – although this requires significant investment and time. The nation is well-equipped with a robust water supply system, and ongoing efforts to enhance crop yields on Vietnam’s Mekong Delta, salinity levels, and flooding intensity have increased as a result of the rise in incidents of extreme weather, prompting advancements in rice farming mechanization to be implemented that are modeled after practices that have been successfully used in the Philippines.
    Despite these advances, issues (e.g., over-application of rice seeds) remain. The dominant land cover type in Malaysia is tropical rainforest, although agriculture – particularly oil palm plantations – also plays a significant role in land use. While stable, it shares environmental concerns with Indonesia. The country is integrating solar energy initiatives, placing solar panels on former agricultural lands and recreational areas, which raises coastal environmental concerns. In Taiwan, substantial land use changes have stemmed from solar panel installations to support green energy goals but have led to increased temperatures and altered wind patterns.
    All panelists agreed that remote sensing technologies are vital to inform agricultural policy across the region. They emphasized the need to transition from academic research to actionable insights that directly inform policy. Panelists also discussed the challenge of securing funding for actionable research – underlining the importance of recognizing the transition required for research to inform operational use. Some countries (e.g., Thailand) have established operational crop monitoring systems, while others (e.g., Vietnam) primarily depend on research projects. Despite progress in Malaysia’s monitoring of oil palm plantations, a comprehensive operational monitoring system is still lacking in many areas. The participants concluded that increased efforts are needed to promote the wider adoption of remote sensing technologies for agricultural and environmental monitoring, with emphasis on developing operational systems that can be integrated into policy and decision-making processes.
    Air Pollution Discussions
    The discussion on air pollution focused on various sources in Southeast Asia, which included both local and transboundary factors. Panelists highlighted that motor vehicles, industrial activities, and power plants are major contributors to pollutants, such as PM2.5, NO2, ozone (O3), and carbon monoxide (CO). Forest fires in Indonesia – particularly from South Sumatra and Riau provinces – are significantly impacting neighboring countries, e.g., Malaysia. A study found that most PM2.5 pollution in Kuala Lumpur originates from Indonesia. During the COVID-19 pandemic, pollution levels dropped sharply due to reduced economic activity; however, data from 2018–2023 shows that PM2.5 levels have returned to pre-pandemic conditions.
    The Indonesian government is actively working to reduce deforestation and emissions, aiming for a 29% reduction by 2030. Indonesia is also participating in carbon markets and receiving international payments for emission reductions. Indonesia’s emissions also stem from energy production, industrial activities, and land-use changes, including peat fires. The Indonesian government reports anthropogenic sources – particularly from the energy sector and industrial activities, forest and peat fires, waste, and agriculture – continue to escalate. While Indonesia is addressing these issues, growing population and energy demands continue to drive pollution levels higher.
    Vietnam and Laos are facing similar challenges related to air pollution – particularly from agricultural residue burning. Both governments are working on expanding air quality monitoring, regulating waste burning, and developing policies to mitigate pollution. Vietnam has been developing provincial air quality management plans and expanding its monitoring network. Laos has seen increased awareness of pollution, accompanied by government measures aimed at restricting burning and improving waste management practices.
    The panelists agreed that collaborative efforts for regional cooperation are essential to address air pollution. This will require collaboration in research and data sharing to inform policy decisions. There is a growing interest in leveraging satellite technology and modeling approaches to enhance air quality forecasting and management. To ensure that research translates into effective policy, communication of scientific findings to policymakers is essential – particularly by clearly communicating complex research concepts in accessible formats. All panelists agreed on the importance of improving governance, transparency, and scientific communication to better translate research into policy actions, highlighting collaborations with international organizations – including NASA – to address air quality issues. While significant challenges related to air pollution persist in Southeast Asia, noteworthy efforts are underway to improve awareness, research, and collaborative governance aimed at enhancing air quality and reducing emissions.
    Conclusion
    The LCLUC–SARI Synthesis meeting fostered collaboration among researchers and provided valuable updates on recent developments in LUCC research, exchange of ideas, integration of new data products, and discussions on emerging science directions. This structured dialogue (particularly the discussions in each session) helped the attendees identify priorities and needs within the LUCC community. All panelists and meeting participants commended the SARI leadership for their proactive role in facilitating collaborations and discussions that promote capacity-building activities across the region. SARI activities have significantly contributed to enhancing the collective ability of countries in South and Southeast Asia to address pressing environmental challenges. The meeting participants emphasized the importance of maintaining and expanding these collaborative efforts, which are crucial for fostering partnerships among governments, research institutions, and local communities. They urged SARI to continue organizing workshops, training sessions, and knowledge-sharing platforms that can equip stakeholders with the necessary skills and resources to tackle environmental issues such as air pollution, deforestation, climate change, and sustainable land management.
    Krishna VadrevuNASA’s Marshall Space Flight Centerkrishna.p.vadrevu@nasa.gov
    Vu TuanVietnam National Science Center, Vietnamvatuan@vnsc.org.vn
    Than NguyenVietnam National University Engineering and Technology, Vietnamthanhntn@vnu.edu.vn
    Son NghiemJet Propulsion Laboratoryson.v.nghiem@jpl.nasa.gov
    Tsuneo MatsunagaNational Institute of Environmental Studies, Japanmatsunag@nies.go.jp
    Garik GutmanNASA Headquartersggutman@nasa.gov
    Christopher JusticeUniversity of Maryland College Parkcjustice@umd.edu

    MIL OSI USA News

  • MIL-OSI Economics: Frank Elderson: Interview with Nederlandse Vereniging Duurzame Energie (NVDE)

    Source: European Central Bank

    Interview with Frank Elderson, conducted by NVDE

    20 February 2025

    TIME has named you one of the 100 most influential climate leaders in business. Why are you so motivated to integrate climate and nature-related risks into exercising the mandate of central banks and supervisors?

    Climate, nature and the economy are deeply interconnected and interdependent. The twin climate and nature crises are sources of financial risk. For central banks and supervisors, addressing these issues is therefore neither an option nor a political choice – it is an obligation that falls squarely within our mandate. If central bankers and supervisors want to effectively pursue their tasks of maintaining price stability and keeping the banking sector safe, they need to be mindful of the environment in which they operate. This means considering the impact of the climate and nature crises on inflation and banks’ safety and soundness.

    Is the energy transition in Europe progressing too slowly? If so, why?

    Europe has made significant progress in its energy transition, but if it wants to reach the agreed target, it needs to remain determined and avoid undermining what has been achieved so far. The facts are that current policies put Europe on a 3.1°C warming trajectory over the course of the century, which is too far from the 1.5°C target.[1] The economic risks associated with delayed action are stark: a late, abrupt transition away from fossil fuels would weaken the economy and increase losses for the financial system, making the path to net zero far more costly.[2] In fact, the United Nations has warned that climate mitigation must increase sixfold globally to stay on track for the Paris Agreement.[3] These figures underscore the urgent need for Europe not to relent in its transition efforts if it wants to avoid severe economic and environmental consequences.

    In a previous study, you demonstrated that most European companies and banks face significant financial risks when natural ecosystems collapse due to climate change and biodiversity loss. What are examples of these financial risks? What is the most important recommendation in the report?

    The interdependencies between banks, businesses and nature lead to financial risks. Damage to ecosystems through nature degradation and biodiversity loss poses a significant threat to the economic viability of companies and, by extension, to the financial stability of banks that grant them loans. The study you mention showed that, in the euro area, 72% of non-financial corporations rely heavily on at least one ecosystem service, while 75% of corporate bank loans – approximately €3.24 trillion – are tied to these ecosystem-dependent borrowers.[4] Key ecosystem services such as surface and ground water, together with mass stabilisation[5] and erosion control, are particularly critical, exposing banks to credit risks through affected firms.

    One of the most important lessons from the report is the recognition that biodiversity loss is both an economic and financial risk. A second lesson is that climate and biodiversity are, to a large extent, two sides of the same coin, and they cannot be addressed in isolation. Lastly, the report shows that we are still missing the data needed to better take into account the risks stemming from nature loss. To address this, we need to improve the way we collect and organise information about nature.

    What is the impact of climate change on inflation?

    The economic impacts of climate change and extreme weather events are impossible to ignore. Following 2023’s record-breaking temperatures, 2024 became the warmest year on record globally, reaching 1.5°C above pre-industrial levels.[6] Europe, the fastest-warming continent, saw temperatures soar to 2.9°C above pre-industrial levels in 2024. The physical impacts of climate change – such as more frequent and severe weather events like floods, droughts, and city and forest fires – disrupt supply chains, reduce agricultural yields and drive up food prices. For example, an interdisciplinary study by ECB economists and climate scientists showed that the 2022 heatwave in Europe added 0.8 percentage points to euro area food price inflation.[7]

    The green transition will also bring about structural economic changes, which could influence inflation. Although the overall impact of the green transition remains very uncertain and may vary over time, we need to account for it to effectively deliver on our mandate. This is why we are increasingly incorporating green transition policies, such as climate-related fiscal policies or assumptions on carbon pricing under the EU Emissions Trading System 2, into our macroeconomic analyses.[8]

    To what extent do oil and gas reserves, as stranded assetslosing their value due to the necessity of staying within the 1.5°C climate goalpose an economic risk?

    Generally, stranded assets pose greater economic and financial risks to the extent that industries and banks are not prepared. As the economy moves towards meeting climate goals, industries need to adjust how they operate. And since most companies in the EU with high-emitting production facilities rely on bank financing, this also has a significant impact on banks’ balance sheets. Last year, we released a study on the banking sector’s alignment with EU climate objectives, where we found that 90% of analysed banks faced elevated transition risks due to substantial misalignment with the Paris Agreement.[9] The biggest risk stems from exposures to companies in the energy sector that are lagging behind in phasing out high-carbon production processes and are slow to scale up renewable energy production.[10]

    To what extent does the ECB incorporate climate-related risks into its monetary policy?

    The ECB has taken significant steps to integrate climate-related risks into its monetary policy framework. It has reduced the carbon footprint of the Eurosystem’s corporate bond holdings and expanded annual climate disclosures to cover over 99% of assets held for monetary policy purposes. We’re also making progress in embedding climate considerations in our modelling and forecasting. Through exercises such as climate stress tests, we’ve deepened our understanding of the impact of the green transition and the physical impacts of the climate crisis. To improve data availability, which is key if we want to keep incorporating climate and nature risks, the ECB has developed climate-related statistical indicators.

    How does the ECB ensure that the financial sector properly manages the risks associated with climate change?

    Five years on from the publication of the ECB Guide on C&E risks in 2020, banks have made significant progress in managing climate-related and environmental (C&E) risk. Initially, fewer than 25% of banks had worked on climate-related risk management, and in 2021 a self-assessment conducted by the banks revealed that 90% of their practices fell short of our expectations.

    Following thorough assessments in 2022, we came to the conclusion that the glass was filling up, but that it wasn’t yet half full. Based on what the banks themselves considered reasonable when we first started discussing C&E risk management with them, we set interim deadlines resulting in three milestones: by March 2023 banks were expected to draw up adequate materiality assessments; by December 2023 they needed to integrate C&E risks into their governance, strategy and risk management; and by the end of 2024 they were expected to comply with the full scope of ECB expectations on C&E risk.

    Encouragingly, most banks met the targets set by the 2023 deadlines, and frameworks for climate and nature-related risks are now broadly in place. However, a few banks are still lagging behind and could face potential penalties. For the third and final deadline, which just passed at the end of 2024, we are proceeding with our compliance assessments in the same way as for the two previous deadlines.

    What specific sustainability measure will you personally advocate for within the ECB in 2025?

    In 2025 we will closely monitor progress and, where necessary, use all the tools at our disposal to ensure the banking sector is resilient in the face of the unfolding climate and nature crises. As part of the ECB’s multi-year agenda for banking supervision, we will make sure that the banks we supervise directly – whose assets total over €26 trillion – fully account for climate and nature-related risks in their strategies and risk management. Ensuring banks comply with the new regulatory requirement to develop transition plans to prepare for the risks and potential changes in their business models associated with the green transition is particularly high on the agenda.

    What are your thoughts on Mario Draghi’s report, particularly his call for further financial and economic integration within the EU through, for example, establishing a capital markets union? This plan aims to create a single integrated capital market in the EU, allowing investments and savings to flow more freely across borders.

    From an ECB perspective, we have always been supportive of a deeper capital markets union (CMU). The renewed political momentum we have seen recently in furthering CMU – or a savings and investment union – has come at a crucial time. In fact, the bulk of the additional financing needed for the green transition has to come from the private sector.[11]

    The European Commission estimates that the EU needs an extra €477 billion (equivalent to 3.4% of GDP in 2023) of green investment per year by 2030. This number increases to €620 billion when considering the EU’s broader environmental ambitions. While banks are expected to make an important contribution, expanding and integrating capital markets is essential for directing the flow of funds towards green innovation. The public sector also has a key role to play in mobilising private green investment by crowding in private investment through, for example, lowering borrowers’ financing costs or de-risking green investment activities.

    Sustainable energy technologies and electricity infrastructure have higher investment costs than fossil fuel technologies. As a result, high interest rates slow the energy transition, despite its potential to help combat inflation. Recent high inflation was partly driven by high fossil energy prices. Could a lower interest rate for investments in sustainable energy accelerate the shift away from fossil fuels?

    The ECB’s primary objective is to maintain price stability, and this will always remain the cornerstone of our actions. But we also have a secondary objective, which requires us to support the general economic policies in the EU, including contributing to a high level of protection and improvement of the quality of the environment.[12] Within this mandate, accounting for the effects of climate and nature-related events is part and parcel of our tasks. Importantly, any direct incentives and tools must align with our monetary policy stance. In the specific case you mention, further challenges – such as data coverage and quality, defining appropriate green targeting criteria and establishing robust verification processes – still exist. Some of these issues require agreement on a European level, where we are dependent on legislation.

    Having said that, the ECB’s euro area bank lending survey tells us that European banks are already offering more favourable lending conditions to green firms or firms in transition.[13] In addition, governments can support green projects in a more targeted and effective way by offering more favourable lending through for instance public development banks. Despite this, the ECB still actively monitors regulatory developments.

    Are you optimistic about the energy transition in Europe?

    I am generally an optimistic person. In this case, the progress made speaks for itself: the share of renewables in the EU’s final energy use more than doubled between 2005 and 2023.[14] And last year, nearly half of the EU’s electricity was powered by renewables.[15] Much-needed investment in climate change mitigation has also grown, increasing by 42% between 2005 and 2022.[16]

    We know progress is possible, but we now need to go further and faster. Our research shows that a quicker transition will lower costs – being ready can offer a competitive advantage. Consumer preferences are already changing and these will support the transition. In that respect, we welcome the European Commission’s focus on both decarbonisation and competitiveness.

    Last but not least, through my involvement with the Network for Greening the Financial System (NGFS), which I co-founded and of which I was the first Chair, I’ve also witnessed first-hand the impact a committed group of central banks and supervisors working towards a common goal can have. The NGFS has grown from its original eight members to 143 members today. This “coalition of the committed” is prepared to help future-proof the economy and the banking sector. Regardless of the political winds that are blowing, the reality of the climate and nature crises doesn’t change. And as most Europeans know, it is a reality we must face head on.

    How sustainably do you live and travel?

    We have a fully electric car, and as a proud Dutchman, I love to ride my bike.

    MIL OSI Economics

  • MIL-OSI Europe: President von der Leyen at the CARICOM Leaders’ Summit to strengthen partnership between the European Union and the Caribbean

    Source: European Commission

    European Commission Press release Brussels, 20 Feb 2025 During the first-ever visit of a European Commission President to the Caribbean, European Commission President Ursula von der Leyen reaffirmed Europe’s commitment to deepening its relations and partnership with the region.

    At the invitation of Caribbean Community (CARICOM) Chair, Barbados Prime Minister Mia Mottley, President von der Leyen met the 15 leaders of the Caribbean Community during the 48th Regular Meeting of the CARICOM.  The visit aims at further strengthening the EU’s presence in the region and lay the groundwork for the EU-CELAC Summit, planned for later this year.  

    In a new era of harsh geostrategic competition, Europe stands for openness, partnership and outreach. The visit took place in the context of the Commission’s effort to build new partnerships and strengthen old ones, which includes recent agreements with Mercosur, Mexico and Malaysia.

    President von der Leyen said: “Europe and the Caribbean may be an ocean apart, but we are close allies. We share so many interests and values, including our mutual support for Ukraine. Europe stands with the Caribbean countries in the fight against climate change, protecting nature and biodiversity, strengthening trade, and boosting investments through Global Gateway. Europe wants to be a fair and trusted partner for all regions of the world that want to work with us.”

    President von der Leyen also discussed with Caribbean partners the situation in Haiti. She underlined the EU’s commitment to Haiti’s recovery and security and its support to CARICOM efforts in this regard. In this context, a package of €19.5 million EU support was announced during the visit. This new financial support will complement ongoing efforts to deliver essential services to Haitians as well as support the country’s macroeconomic stability.

    President von der Leyen highlighted the EU’s commitment to supporting Caribbean partners in fighting climate change and its devastating impact on the islands. As the leading provider of climate finance, the EU is determined to work together on innovative financing, while promoting private sector investments.

    At global level, the EU and the Caribbean are stepping up their energy partnership following the launch of the Global Energy Transition Forum by President von der Leyen in Davos last month. She welcomed the 8 countries (Barbados, Guyana, Grenada, Haiti, Jamaica, Saint Kitts and Nevis, Saint Vincent and the Grenadines, Dominica)* that joined the forum during the summit, committing to action to meet the global targets of tripling renewable energy capacity and doubling energy efficiency by 2030.

    During the visit, President von der Leyen underscored the reliability of the EU as a trade and investment partner to the region working together on mutually beneficial projects. President von der Leyen launched several projects under Europe’s Global Gateway strategy on renewable energy, digital transformation, pharmaceutical production and economic resilience. The projects will invest in a stronger, greener and better connected Caribbean.

    Key Global Gateway projects in the Caribbean

    Expanding Renewable Energy: Global Gateway energy projects are underway in 13 Caribbean countries, leveraging European expertise, technology, and financing tools. In this context, President von der Leyen and Prime Minister Mottley announced a €160 million green hydrogen storage project by the French company HDF Energy, the first of its kind in the Caribbean.

    Advancing the Digital Agenda: The EU and the Caribbean are strengthening their digital partnership with the signing of a Memorandum of Understanding (MoU) between the Caribbean and the European satellite company Hispasat during the CARICOM meeting. It will improve the Caribbean’s satellite internet connectivity and sovereignty within the framework of the EU–LAC Digital Alliance. As part of this initiative, the EU and Spain will provide a €10 million grant to support satellite broadband expansion and promote digital inclusion across the region.

    Developing Local Pharmaceutical Production: The EU’s €8.9 million investment to promote local production and regulatory alignment with European standards was also taken forward in the framework of the CARICOM meeting. A joint declaration to cooperate on twinning Caribbean and EU regulatory agencies, capacity-building initiatives, and research collaborations was signed during the meeting. Additionally, the first investment from a European pharmaceutical company, Biomed X in Barbados, will support research and manufacturing, further reinforcing the region’s health resilience.

    Supporting Post-Hurricane Reconstruction: As part of the assistance given to Grenada in rebuilding Carriacou and Petite Martinique after Hurricane Beryl, the EU is supporting the islands to become 100% powered by renewable energy. This initiative will serve as a global model for small islands striving for climate resilience.

    Combating the Sargassum Challenge: The EU, in collaboration with regional partners, is transforming the environmental and economic challenge of sargassum seaweed into an opportunity for sustainable development. Through an ongoing €386 million Global Gateway initiative, the EU is working with financial institutions such as the European Investment Bank and the private sector to develop sustainable value chains for sargassum, particularly in Grenada.

    For More Information

    Opening remarks by President von der Leyen at the opening ceremony of the 48th Regular Session of the Conference of CARICOM

    Statement by President von der Leyen at the joint press conference with Barbadian Prime Minister Mottley

    * Updated on 20/02/2025 at 14:55

     Europe and the Caribbean may be an ocean apart, but we are close allies. We share so many interests and values, including our mutual support for Ukraine. Europe stands with the Caribbean countries in the fight against climate change, protecting nature and biodiversity, strengthening trade, and boosting investments through Global Gateway. Europe wants to be a fair and trusted partner for all regions of the world that want to work with us.

    Ursula von der Leyen, President of the European Commission

    MIL OSI Europe News

  • MIL-OSI United Nations: From suits to social justice: World’s top human rights forum turns stage over

    Source: United Nations 2

    Trading suits, ties and debates for DJ turntables, bright traditional Indigenous garb and ancient instruments, three performers – an anthropologist, an R&B singer and a genre-defying artist – showcased their music and messages at the Stand Up for Social Justice event to celebrate the World Day of Social Justice, marked annually on 20 February.

    It took place in front of hundreds of people in the emblematic Human Rights and Alliance of Civilizations Room, where high-stakes diplomacy happens throughout the year.

    The world needs more diverse platforms like the UN “so that transculturality can exist”, said Brisa Flow, a Chilean-born Mapuche artist who got her first break in rap battles in Brazil, following her intense musical performance.

    “We need more empathy and to listen more to Indigenous Peoples in order to better understand how to take care of our territories that need care, not just in terms of water, food and land, but also our children and our elders,” said the São Paulo-based singer, rocking a green marble-printed manicure.

    “We need to be in spaces where everything we speak about is not just a utopia, where hope, which exists, can be heard and considered.”

    Calls for change around the world

    Ms. Flow joined French-speaking Geneva-born R&B revelation Ocevne (pronounced Océane) and anthropologist-cum-poet Idjahure Terena in delivering powerful music and personal messages inspired by social justice while helping to link local realities to issues of a global scale.

    Echoing the Day’s 2025 theme Strengthening a Just Transition for a Sustainable Future, the event was co-organised by UNRISD, an independent UN research institute focusing on development issues, and Antigel, a Geneva-based music festival designed to make culture more accessible.

    The messages from the young people on stage did just that, with electrifying performances and calls for change around the world.

    For Ocevne, 28, the message was about equality.

    “The simplest way I could define it is simply the right to equal opportunities,” she said. “No matter your background, where you come from, who you are, your gender, everything, we all have the right to that opportunity.”

    © City of Geneva/ANTIGEL/Giona

    Ocevne warming up the room at the Stand Up for Social Justice event.

    ‘No climate justice without social justice’

    Climate justice was another recurring theme throughout the event, an issue highlighted by Mr. Terena, a doctoral student in social anthropology at the University of São Paulo and poet who spends much of his time defending the rights of his community and others.

    “There is no climate justice without social justice,” he told the audience. “We know that standing forests are the simplest and most efficient solution for fighting global warming.”

    The young researcher slammed the impact of mining companies and agribusinesses on his ancestral land that belongs to the Terena people of Brazil in the Pantanal region of Mato Grosso do Sul.

    “This is not just a territorial issue, but a matter of physical and cultural survival for our peoples and for humanity as indigenous lands represent the most important areas of biodiversity,” he said, inviting the audience to fight for a “common, diverse living world”.

    © Courtesy of Idjahure Terena

    Idjahure Terena playing the japurutu flute with his father-in-law Francisco Baniwa in Brazil.

    ‘The future is going to be very hot’

    Indeed, “the future is going to be very hot,” said Ms. Flow, adding that “it is already very hot in Brazil, and this is urgent for us because without water, we cannot live, and without food, [we cannot] either.”

    Advocating for issues affecting indigenous communities, including the burning impacts of climate change on the natural resources of her home country, she said collectively not enough is getting done.

    “We need more communication and more exchanges. By exchanges, I mean listening, speaking, listening, speaking and thinking about new ways of living well so that we can keep heading into the future.”

    © Giselle Dietze

    Brazilian federal deputy Célia Xakriabá (right) performs with artist Brisa Flow at the Stand Up for Social Justice concert.

    Amplifying marginalised voices

    The event is the brainchild of the UN Research Institute for Social Development (UNRISD) Head of communications chief Karima Cherif, who wanted to bridge art and research through the initiative.

    She says her institute works with scholars from the global South to ensure that the voices and expertise of minorities are heard.

    “We’re giving voices to the marginalised and the youth,” explained Ms. Cherif, who sees art as a way to “translate what we do in a language that can touch hearts”.

    ‘Never give up’

    Thuy-San Dinh, who heads Antigel, echoed her vision and encouraged the young audience to pursue their goals, recalling when she co-created the annual event 15 years ago.

    “You have to believe in your ideas and never give up,” Ms. Dinh said.

    Melanie Rouquier, who created SHAP SHAP, a non-profit that fights global inequality and discrimination through cultural projects, told several activists in the room that each of their actions showed citizen engagement was not a lost cause.

    “To resist, we have to get together,” she said.

    © City of Geneva/ANTIGEL/Giona

    Brisa Flow playing a traditional instrument at the Stand Up for Social Justice concert in Geneva in February 2025.

    Connecting generations

    For Aryan Yasin, a designer from Geneva who founded a cultural non-profit supporting disadvantaged youth, the show was an opportunity for cross-pollination and broadening his network by connecting with UN staff.

    The exceptional venue “is not a place where you would necessarily see young people”, he said. “But, that actually allows us to create an intergenerational connection, with people who are more experienced, more established,” he added.

    After the show, management student Ludivine said she was mesmerised by the experience. Putting on a concert with one of her favourite artists there to denounce inequalities “makes sense… because at the UN, people get together to talk about inequalities around the world.”

    © Courtesy of Brisa Flow

    Ms. Flow (right) at a protest by the Guarani people of Brazil.

    What is social justice?

    After the event ended, doctoral students Beatrice and Thomas shared what the concept of social justice, which can seem quite abstract, meant to them.

    “It’s about recognising and taking differences into account while ensuring that everyone has the same access” to the same opportunities, said Beatrice, from Italy, who studies at École Polytechnique Fédérale de Lausanne.

    “That may mean that some people will need more support, while others may not need as much, but have different needs.”

    Thomas offered a more societal vision of the idea.

    “For me, it’s something that is both individual and collective – something that must be built as a society. It is entirely dependent on the structures we have put in place, but it also relies on everything that is local.”

    Read our social justice explainer here.

    ‘We need to be united’

    Ahead of the concert, Tatiana Valovaya, Director-General of the UN Office at Geneva set the tone in her opening remarks in the Human Rights and Civilisation Room.

    “This room sees a lot of very important and challenging negotiations,” she told the audience. “But, today we open this room to everyone.”

    Geneva Mayor Christina Kitsos, whose term is guided by the motto “what connects us”, reminded the youthful audience of the UN’s fundamental role despite the worrying rise of “desire to undermine all the work [that has been done] around humanitarian aid and human rights”.

    “We need to be united, strong and truly hopeful and courageous to ensure that we stay the course, that we remain a beacon in this world in turmoil,” she said.

    MIL OSI United Nations News

  • MIL-OSI Europe: Written question – Arctic-boreal zone emissions – E-000644/2025

    Source: European Parliament

    Question for written answer  E-000644/2025
    to the Commission
    Rule 144
    César Luena (S&D)

    A study by Nature Climate Change[1] has revealed significant changes in the CO2 balance of the arctic-boreal zone between 2001 and 2020. While the region in general remains a carbon sink, more than 30 % of the region is a net source of CO2 and the trends are alarming. Tundra regions may have already started to operate on average as CO2 sources, demonstrating a shift in carbon dynamics. What is more, when fire emissions are factored in, the zone’s growing sink is no longer statistically significant and the permafrost region becomes CO2 neutral.

    • 1.Taking account of the crucial role played by forest fires, what specific measures is the Commission planning to improve fire prevention and management in European boreal regions?
    • 2.Given the importance of permafrost in carbon storage, and with a view to understanding and mitigating the impacts of permafrost melting on CO2 emissions, what research and monitoring initiatives does the Commission plan to support?
    • 3.How does the Commission intend to address these changes in its international cooperation policies, particularly in cooperation with countries with territory in the arctic and boreal region?

    Submitted: 12.2.2025

    • [1] https://www.nature.com/articles/s41558-024-02234-5
    Last updated: 20 February 2025

    MIL OSI Europe News

  • MIL-OSI Europe: Frank Elderson: Interview with Nederlandse Vereniging Duurzame Energie (NVDE)

    Source: European Central Bank

    Interview with Frank Elderson, conducted by NVDE

    20 February 2025

    TIME has named you one of the 100 most influential climate leaders in business. Why are you so motivated to integrate climate and nature-related risks into exercising the mandate of central banks and supervisors?

    Climate, nature and the economy are deeply interconnected and interdependent. The twin climate and nature crises are sources of financial risk. For central banks and supervisors, addressing these issues is therefore neither an option nor a political choice – it is an obligation that falls squarely within our mandate. If central bankers and supervisors want to effectively pursue their tasks of maintaining price stability and keeping the banking sector safe, they need to be mindful of the environment in which they operate. This means considering the impact of the climate and nature crises on inflation and banks’ safety and soundness.

    Is the energy transition in Europe progressing too slowly? If so, why?

    Europe has made significant progress in its energy transition, but if it wants to reach the agreed target, it needs to remain determined and avoid undermining what has been achieved so far. The facts are that current policies put Europe on a 3.1°C warming trajectory over the course of the century, which is too far from the 1.5°C target.[1] The economic risks associated with delayed action are stark: a late, abrupt transition away from fossil fuels would weaken the economy and increase losses for the financial system, making the path to net zero far more costly.[2] In fact, the United Nations has warned that climate mitigation must increase sixfold globally to stay on track for the Paris Agreement.[3] These figures underscore the urgent need for Europe not to relent in its transition efforts if it wants to avoid severe economic and environmental consequences.

    In a previous study, you demonstrated that most European companies and banks face significant financial risks when natural ecosystems collapse due to climate change and biodiversity loss. What are examples of these financial risks? What is the most important recommendation in the report?

    The interdependencies between banks, businesses and nature lead to financial risks. Damage to ecosystems through nature degradation and biodiversity loss poses a significant threat to the economic viability of companies and, by extension, to the financial stability of banks that grant them loans. The study you mention showed that, in the euro area, 72% of non-financial corporations rely heavily on at least one ecosystem service, while 75% of corporate bank loans – approximately €3.24 trillion – are tied to these ecosystem-dependent borrowers.[4] Key ecosystem services such as surface and ground water, together with mass stabilisation[5] and erosion control, are particularly critical, exposing banks to credit risks through affected firms.

    One of the most important lessons from the report is the recognition that biodiversity loss is both an economic and financial risk. A second lesson is that climate and biodiversity are, to a large extent, two sides of the same coin, and they cannot be addressed in isolation. Lastly, the report shows that we are still missing the data needed to better take into account the risks stemming from nature loss. To address this, we need to improve the way we collect and organise information about nature.

    What is the impact of climate change on inflation?

    The economic impacts of climate change and extreme weather events are impossible to ignore. Following 2023’s record-breaking temperatures, 2024 became the warmest year on record globally, reaching 1.5°C above pre-industrial levels.[6] Europe, the fastest-warming continent, saw temperatures soar to 2.9°C above pre-industrial levels in 2024. The physical impacts of climate change – such as more frequent and severe weather events like floods, droughts, and city and forest fires – disrupt supply chains, reduce agricultural yields and drive up food prices. For example, an interdisciplinary study by ECB economists and climate scientists showed that the 2022 heatwave in Europe added 0.8 percentage points to euro area food price inflation.[7]

    The green transition will also bring about structural economic changes, which could influence inflation. Although the overall impact of the green transition remains very uncertain and may vary over time, we need to account for it to effectively deliver on our mandate. This is why we are increasingly incorporating green transition policies, such as climate-related fiscal policies or assumptions on carbon pricing under the EU Emissions Trading System 2, into our macroeconomic analyses.[8]

    To what extent do oil and gas reserves, as stranded assetslosing their value due to the necessity of staying within the 1.5°C climate goalpose an economic risk?

    Generally, stranded assets pose greater economic and financial risks to the extent that industries and banks are not prepared. As the economy moves towards meeting climate goals, industries need to adjust how they operate. And since most companies in the EU with high-emitting production facilities rely on bank financing, this also has a significant impact on banks’ balance sheets. Last year, we released a study on the banking sector’s alignment with EU climate objectives, where we found that 90% of analysed banks faced elevated transition risks due to substantial misalignment with the Paris Agreement.[9] The biggest risk stems from exposures to companies in the energy sector that are lagging behind in phasing out high-carbon production processes and are slow to scale up renewable energy production.[10]

    To what extent does the ECB incorporate climate-related risks into its monetary policy?

    The ECB has taken significant steps to integrate climate-related risks into its monetary policy framework. It has reduced the carbon footprint of the Eurosystem’s corporate bond holdings and expanded annual climate disclosures to cover over 99% of assets held for monetary policy purposes. We’re also making progress in embedding climate considerations in our modelling and forecasting. Through exercises such as climate stress tests, we’ve deepened our understanding of the impact of the green transition and the physical impacts of the climate crisis. To improve data availability, which is key if we want to keep incorporating climate and nature risks, the ECB has developed climate-related statistical indicators.

    How does the ECB ensure that the financial sector properly manages the risks associated with climate change?

    Five years on from the publication of the ECB Guide on C&E risks in 2020, banks have made significant progress in managing climate-related and environmental (C&E) risk. Initially, fewer than 25% of banks had worked on climate-related risk management, and in 2021 a self-assessment conducted by the banks revealed that 90% of their practices fell short of our expectations.

    Following thorough assessments in 2022, we came to the conclusion that the glass was filling up, but that it wasn’t yet half full. Based on what the banks themselves considered reasonable when we first started discussing C&E risk management with them, we set interim deadlines resulting in three milestones: by March 2023 banks were expected to draw up adequate materiality assessments; by December 2023 they needed to integrate C&E risks into their governance, strategy and risk management; and by the end of 2024 they were expected to comply with the full scope of ECB expectations on C&E risk.

    Encouragingly, most banks met the targets set by the 2023 deadlines, and frameworks for climate and nature-related risks are now broadly in place. However, a few banks are still lagging behind and could face potential penalties. For the third and final deadline, which just passed at the end of 2024, we are proceeding with our compliance assessments in the same way as for the two previous deadlines.

    What specific sustainability measure will you personally advocate for within the ECB in 2025?

    In 2025 we will closely monitor progress and, where necessary, use all the tools at our disposal to ensure the banking sector is resilient in the face of the unfolding climate and nature crises. As part of the ECB’s multi-year agenda for banking supervision, we will make sure that the banks we supervise directly – whose assets total over €26 trillion – fully account for climate and nature-related risks in their strategies and risk management. Ensuring banks comply with the new regulatory requirement to develop transition plans to prepare for the risks and potential changes in their business models associated with the green transition is particularly high on the agenda.

    What are your thoughts on Mario Draghi’s report, particularly his call for further financial and economic integration within the EU through, for example, establishing a capital markets union? This plan aims to create a single integrated capital market in the EU, allowing investments and savings to flow more freely across borders.

    From an ECB perspective, we have always been supportive of a deeper capital markets union (CMU). The renewed political momentum we have seen recently in furthering CMU – or a savings and investment union – has come at a crucial time. In fact, the bulk of the additional financing needed for the green transition has to come from the private sector.[11]

    The European Commission estimates that the EU needs an extra €477 billion (equivalent to 3.4% of GDP in 2023) of green investment per year by 2030. This number increases to €620 billion when considering the EU’s broader environmental ambitions. While banks are expected to make an important contribution, expanding and integrating capital markets is essential for directing the flow of funds towards green innovation. The public sector also has a key role to play in mobilising private green investment by crowding in private investment through, for example, lowering borrowers’ financing costs or de-risking green investment activities.

    Sustainable energy technologies and electricity infrastructure have higher investment costs than fossil fuel technologies. As a result, high interest rates slow the energy transition, despite its potential to help combat inflation. Recent high inflation was partly driven by high fossil energy prices. Could a lower interest rate for investments in sustainable energy accelerate the shift away from fossil fuels?

    The ECB’s primary objective is to maintain price stability, and this will always remain the cornerstone of our actions. But we also have a secondary objective, which requires us to support the general economic policies in the EU, including contributing to a high level of protection and improvement of the quality of the environment.[12] Within this mandate, accounting for the effects of climate and nature-related events is part and parcel of our tasks. Importantly, any direct incentives and tools must align with our monetary policy stance. In the specific case you mention, further challenges – such as data coverage and quality, defining appropriate green targeting criteria and establishing robust verification processes – still exist. Some of these issues require agreement on a European level, where we are dependent on legislation.

    Having said that, the ECB’s euro area bank lending survey tells us that European banks are already offering more favourable lending conditions to green firms or firms in transition.[13] In addition, governments can support green projects in a more targeted and effective way by offering more favourable lending through for instance public development banks. Despite this, the ECB still actively monitors regulatory developments.

    Are you optimistic about the energy transition in Europe?

    I am generally an optimistic person. In this case, the progress made speaks for itself: the share of renewables in the EU’s final energy use more than doubled between 2005 and 2023.[14] And last year, nearly half of the EU’s electricity was powered by renewables.[15] Much-needed investment in climate change mitigation has also grown, increasing by 42% between 2005 and 2022.[16]

    We know progress is possible, but we now need to go further and faster. Our research shows that a quicker transition will lower costs – being ready can offer a competitive advantage. Consumer preferences are already changing and these will support the transition. In that respect, we welcome the European Commission’s focus on both decarbonisation and competitiveness.

    Last but not least, through my involvement with the Network for Greening the Financial System (NGFS), which I co-founded and of which I was the first Chair, I’ve also witnessed first-hand the impact a committed group of central banks and supervisors working towards a common goal can have. The NGFS has grown from its original eight members to 143 members today. This “coalition of the committed” is prepared to help future-proof the economy and the banking sector. Regardless of the political winds that are blowing, the reality of the climate and nature crises doesn’t change. And as most Europeans know, it is a reality we must face head on.

    How sustainably do you live and travel?

    We have a fully electric car, and as a proud Dutchman, I love to ride my bike.

    MIL OSI Europe News

  • MIL-OSI Europe: EIB supports Bratislava in modernizing its water supply and wastewater management infrastructure

    Source: European Investment Bank

    • Investments ensures safe and reliable water supply and wastewater management, addressing climate change challenges, while also improving the protection of the Danube
    • EIB financing will improve efficiency of city’s water company Bratislavská vodárenská spoločnosť (BVS) by reducing its energy costs with further utilization of green fuel sources.
    • This is the first direct cooperation between EIB and a municipal company in Bratislava to boost investments in the water sector.

    European Investment Bank (EIB), one of the world’s largest multilateral investors in the water sector, is providing EUR 50 million in Bratislava municipal water utility company Bratislavská vodárenská spoločnosť (BVS) for necessary upgrades and extensions of its water supply and wastewater infrastructure. The financing will help aligning Bratislava water and wastewater management with EU regulations, ensuring the highest quality of drinking water in the city and also allow the BVS to increase utilization of green, biomass energy sources. 

    The modernization programme aims to increase the reliability of water supply for nearly half a million residents and businesses in Bratislava, Slovakia`s main business hub. It also fosters environmental responsibility, by making the city more resilient to adverse effects of climate change and allows BVS to further increase its efficiency and reduce its energy costs.

    “EIB cooperation with BVS means people and businesses in Bratislava can look forward to cleaner water, efficient wastewater management and eco-friendly practices that enhance the city’s quality of life,” said EIB Vice-President Kyriacos Kakouris. “Modern water management is crucial to ensuring the strength and sustainability of urban centres across the EU including Bratislava.”

    “The cooperation approval followed thorough preparation and extensive communication with the EIB. This financing is significantly more cost-effective for us compared to commercial banks. This partnership with BVS is expected to play a crucial role in achieving our ambitious goals of improving our customer services and supporting the environment in our operational area,” said CEO of BVS Ladislav Kizak.
     

    A modern water and wastewater infrastructure for Bratislava

    The modernization project financed by EIB will include the replacement of aging infrastructure with advanced, efficient technologies designed to minimize water loss and improve distribution efficiency as well as expansion of the BVS` network to accommodate the needs from the steadily expanding city.  Expansion of the water supply network will also increase protection of surface and underground waters in metropolitan Bratislava as well as improve protection of the Danube.

    Additionally, the adoption of biomass energy sources will significantly reduce the utility’s carbon footprint, aligning with the city’s commitment to climate action.

    Background information 

    European Investment Bank: The European Investment Bank (ElB) is the long-term lending institution of the European Union, owned by its Member States. Built around eight core priorities, we finance investments that contribute to EU policy objectives by bolstering climate action and the environment, digitalisation and technological innovation, security and defence, cohesion, agriculture and bioeconomy, social infrastructure, the capital markets union, and a stronger Europe in a more peaceful and prosperous world.

    The EIB is one of the largest lenders to the global water sector, with over €88 billion invested in more than 1 700 projects improving sanitation, providing access to safe drinking water and reducing the risk of flooding.  

    The EIB Group, which also includes the European Investment Fund (EIF), signed nearly €89 billion in new financing for over 900 high-impact projects in 2024, boosting Europe’s competitiveness and security. 

    All projects financed by the EIB Group are in line with the Paris Climate Agreement, as pledged in our Climate Bank Roadmap. Almost 60% of the EIB Group’s annual financing supports projects directly contributing to climate change mitigation, adaptation, and a healthier environment. 

    Fostering market integration and mobilising investment, the Group supported a record of over €100 billion in new investment for Europe’s energy security in 2024 and mobilised €110 billion in growth capital for startups, scale-ups and European pioneers

    Approximately half of the EIB’s financing within the European Union is directed towards cohesion regions, where per capita income is lower than the EU average.

    Bratislavská vodárenská spoločnosť (BVS): Bratislavská vodárenská spoločnosť, a.s. (BVS) supplies drinking water to approximately 740 000 regular customers in 118 municipalities across western Slovakia. It draws water primarily from exceptionally high-quality underground sources. Thanks to its advantageous location near the Danube River and the unique gravel-sand subsoil, these water sources are both high-quality and abundant. The 60 water sources that BVS currently operates could technically cover the consumption of more than half of Slovakia. The network of more than 3 200 kilometers of water pipes transports water in 130 water reservoirs and to its customers.

    The second key task of BVS is disposing of wastewater in municipalities connected to the public sewage network. For this purpose, more than 1 800 kilometers of sewer pipes are used, which transport wastewater to 23 wastewater treatment plants. One is the Central Wastewater Treatment Plant in Vrakuňa, the most significant Slovak wastewater treatment plant, with a capacity of 172 800 m3 per day, or 2 000 l per second.

    BVS controls the quality of drinking and treated wastewater in its accredited laboratories.

    BVS’s shares are owned by 89 shareholders, that are cities and municipalities from the region where BVS operates. The City of Bratislava is the majority shareholder, with a share of 59,29 percent. BVS itself holds more than 8 percent of its shares.

    MIL OSI Europe News

  • MIL-OSI USA: Barr, Risks and Challenges for Bank Regulation and Supervision

    Source: US State of New York Federal Reserve

    Banks play an indispensable role in an economy that works for everyone.1 They enable households to borrow to buy a home, save for the future, and deal with the ups and downs of managing finances. Banks provide the credit for businesses to smooth out income and expenses, supply capital to seize new opportunities and create jobs, and facilitate the flow of payments that are the lifeblood of our economy. And banks borrow from households and businesses as well, such as through federally insured deposits. Because of these vital roles, we need to make sure that banks are resilient and serve as a source of strength to the economy in both good times and when the financial system comes under stress. In our market economy, like any business, banks compete with each other and pursue profits by balancing risk-taking with safety and soundness. But because of the key role banks play in the economy, and the fact that banks do not fully internalize the costs of their own failure, regulation and supervision must ensure that banks do not take on excessive risks that can cause widespread harm to households and businesses.
    Bank failures are as old as banking, and we’ve seen repeated waves of bank failures over the centuries. America learned that hard lesson nearly 100 years ago, when bank failures played a central role in the Great Depression. In response, the United States—and many other countries around the globe—set up a system of deposit insurance and enabled emergency lending in times of stress. To balance the moral hazard of the federal safety net, Congress established a framework of regulation and supervision to make it more likely that banks internalize the costs to society of their risk-taking.
    But finance is always evolving, and the buildup of new risks led to the banking crisis of the 1980s, and then to the Global Financial Crisis, with devastating consequences. Weaknesses that were revealed in regulation and supervision led to unprecedented and unpopular bailouts, and shuttered American businesses, devastated local communities with foreclosures, and millions of individuals lost their jobs and their livelihoods. Government responded in the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) and in regulatory reforms by significantly strengthening bank oversight to curb excessive risk-taking. The message from the American people was clear: risk-taking must be balanced with the overarching need to maintain a resilient banking system that can continue to play its crucial role for households and businesses in good times and in bad.
    Another, perennial lesson from the history of bank regulation and supervision is that the job is never done, and that the constant evolution of finance means risks will also evolve. As Vice Chair for Supervision, I have recognized the need to approach this mission with humility, aware that I don’t have all the answers or perfect foresight of where things can go wrong. Both regulators and banks are limited in our ability to comprehensively identify and measure risks. Our financial system is complex, interconnected, and evolving. We cannot fully appreciate how a specific vulnerability can interact with other vulnerabilities to amplify and propagate risk in the face of shocks, let alone accurately anticipate shocks in time to avoid them.
    When I became Vice Chair for Supervision in July 2022, the Global Financial Crisis was almost 15 years past, and much had been done to strengthen the resilience of the system to reflect lessons learned. But in March 2023, we experienced the second largest bank failure in history, Silicon Valley Bank (SVB), and the subsequent failures of Signature Bank and First Republic Bank. SVB’s failure triggered stress throughout the system and required the issuance of a systemic risk exemption and the creation of an emergency bank lending program.2 We have made some progress toward addressing the gaps that led to the failures. But there will be headwinds that we must guard against in the coming years, as well as ongoing vulnerabilities and areas of risk that require continued vigilance.
    Earlier this year, I announced I would step down as Vice Chair for Supervision but remain a member of the Board of Governors. It has been an honor and a privilege to serve as vice chair for supervision, and to work with colleagues to help maintain the stability and strength of the U.S. financial system so that it can meet the needs of households and businesses. I’ve determined that I would be more effective in serving the American people from my role as governor. In this role, I’ll continue to participate in monetary policy deliberations and vote on matters before the Board, including those related to supervision and regulation.
    While it was a tough decision to make, I believe it was the right decision for the institution and, more importantly, for the public, whom we serve. The risk of a dispute over my position would be a distraction from our important mission. I feel strongly—as Chair Powell has said publicly many times—that the independence of the Federal Reserve is critical to our ability to meet our statutory mandates and serve the American public. Put simply, our mission is too important to let such a dispute distract from doing our job for the American people.
    Since my term for Vice Chair for Supervision will end later this month, I’d like to use one of my last opportunities as Vice Chair to discuss seven specific risks ahead: (1) maintaining and finishing post-financial crisis reforms; (2) maintaining the credibility of the stress test; (3) maintaining credible, consistent supervision; (4) encouraging responsible innovation; (5) addressing cyber and third-party risk; (6) risks in the nonbank sector; and (7) climate risk. Each will continue to be a risk in either the near- or long-term.
    Maintaining and Finishing Post-Financial Crisis ReformsThere is always push back on financial regulation. I felt that even in the wake of the Global Financial Crisis, as I helped to draft the legislative response to that crisis, the Dodd-Frank Act.3 And I felt that over the last few years as we worked to finish the job of post-crisis financial reform and take up evolving threats revealed from the latest bank stress. It is important to get the balance right, but it is also important to stand up for the American people.
    I urge regulators to finish the job of implementing the final plank of the Global Financial Crisis reforms—and not to dismantle the hard-fought resilience that banks have built up in the process. Of course, there are always ways to increase efficiency and reform prior methods without costs to resiliency, and I support those efforts. But as I’ve spoken about many times, capital is critical to absorb losses and enable banks to continue operations through times of stress, and capital requirements should be aligned with the risks that banks take.4 The Basel III endgame reforms include many improvements to how we measure credit, trading, operational, and derivatives risks in light of our experience in the Global Financial Crisis. All major jurisdictions except the United States have finalized rules that would implement these standards for their internationally active banks.
    The Federal Reserve played a central role in developing these standards in the many years before my arrival as Vice Chair. The Board sought comment on a proposal in July 2023 to implement the Basel III reforms, and we received a wide range of comments on the proposal.5 On the basis of those comments, I took steps last fall to outline broad and material changes that would better balance the benefits and costs of capital in light of comments received and would result in a capital framework that appropriately reflects the risks of banks.6 These reforms had broad consensus on the Board and the support of the heads of the Office of the Comptroller of the Currency and Federal Deposit Insurance Corporation.
    When the U.S. provides leadership in international forums like Basel and then follows through, we set a powerful example and establish a standard that other jurisdictions also uphold. Implementing international standards enables U.S. firms to compete on a level playing field across the globe and makes the system safer. When we don’t follow through on our commitments, for whatever reason, concerns about a level playing field rise in other jurisdictions, in an international “race to the bottom” on standards. This harms us all and makes U.S. banks less competitive. And unless the U.S. implements these standards, other jurisdictions will force U.S. banks operating abroad to meet their standards instead.
    Let me turn to unfinished business from the March 2023 banking stress. In that event, we learned that bank runs and bank failures can happen fast, much faster than before. Before SVB, the largest bank to fail did so over a period of several weeks. The deposit losses experienced by SVB were much greater in both relative and absolute terms, and they occurred in less than 24 hours.7
    Over the past two years, the Federal Reserve has worked with banks to improve their ability to borrow from the discount window, and the financial system’s collective readiness has improved significantly compared to pre-SVB, including with a substantial increase of $1 trillion in collateral pledged across the system.8 The Federal Reserve has also worked to improve the functioning of the discount window, through a concerted effort to gather public input and identify areas for modernization. These efforts have improved the ability of banks to weather stress, both individually and collectively, which enhances financial stability.
    However, there is still more work to do. For instance, banks, even the largest banks, are not currently required to establish a minimum level of readiness at the window, and, as a result, there are outlier firms that are not prepared for stress. This needs to change. Without a requirement there is also a significant risk of backtracking on the substantial progress in readiness we have made since March 2023.
    Another important lesson from SVB is a classic one: balance sheet vulnerabilities among a group of institutions can be a source of contagion for the financial system and thus a key stability risk. While we did much to improve the resilience of global systemically important banks (G-SIBs) in the past decade, March 2023 showed that significant systemic risks can develop and spread from stress anywhere in the system, including in large and regional banks that are not G-SIBs.9
    The resilience of these firms has improved as they have recognized their vulnerabilities, and we have worked through supervisory channels to encourage risk-management practices that put them on a firmer footing. But we also need to put in place more durable solutions to address risks. For one, the level of capital held by large banks needs to align with the underlying risks on their balance sheets. One important step would be to finalize the requirement that all large firms reflect unrealized losses on available for sale securities in their capital, which is a reform with broad agreement. This will help them manage interest rate risk before it gets to extreme levels, a significant problem revealed in the banking stress of two years ago.
    Another lesson from the spring of 2023 is that large and regional banks—as well as G-SIBs—should ensure that they can actually monetize the securities on which they rely for their liquidity. Why does this matter? Banks need to be able to turn a portion of their assets into cash with a speed sufficient to meet outflows when uninsured depositors or other short-term creditors demand it. Regulation needs to reflect realistic assumptions about monetization.
    We should also consider updating some assumptions about deposit outflows in our liquidity requirements so that they better align with observed stress behavior. During the stress in 2023, we saw uninsured deposits from high-net worth individuals and certain entities, such as venture capital firms, behave more like highly sophisticated financial counterparties than nonfinancial companies or ordinary retail depositors, which is how they are generally treated in regulations.10 This mis-measured risk of deposit outflows means banks may not have sufficient liquidity to manage a stress period.
    In a related vein, banks have stepped up their use of reciprocal deposit arrangements—arrangements where deposits are spread across many banks within a network—as a way to manage the risk of deposit amounts over $250,000.11 While this arrangement spreads risk across the banking system, it is a strategy that has not been tested in a large-scale stress event. It is only logical to wonder how the attenuation of relationships between customers and banks under reciprocal arrangements will affect the behavior of depositors worried about a bank run. We also need to be attentive to operational risks in these arrangements, as well as the risk-management capacity of these companies to manage these relationships under stress.
    A final lesson from the bank stress two years ago is that we need to do more to ensure that all banks that come under stress can be resolved in an orderly fashion. One way to do this would be to require all large banks—including those that are not G-SIBS—to issue certain amounts of long-term debt. This would have helped reassure depositors worried about the stability of bank funding and aided in the eventual resolution of at least some of the banks that came under stress in 2023. The banking agencies have proposed a rule on long-term debt requirements, we have received many helpful comments that led us to adjust it in draft form, and I support moving forward to finalize it with those adjustments.12
    As I mentioned, revised Basel III standards, revised long-term debt requirements, and to-be-proposed liquidity standards would help to address gaps in our current framework, and I continue to believe that they should move forward.
    Moreover, banks and supervisors should also stay vigilant to known risks in the current environment. For instance, risks remain in the commercial real estate market, particularly within the office segment, as borrowers may find it difficult to refinance maturing loans. And interest rate risk, especially for those with high levels of uninsured deposits, remains a key area of focus.
    Maintain the Credibility of the Stress TestWe face a challenging environment with the Federal Reserve’s annual stress tests. The stress tests helped the financial sector emerge from the Global Financial Crisis and rebuild its credibility. The annual stress tests are still important to the financial sector’s credibility today. The stress tests help banks, market participants, and supervisors understand the banks’ vulnerabilities to shocks and to guard against those shocks by holding sufficient capital.
    In December, the Board announced that, due to the evolving legal landscape, we would be undertaking significant changes to the stress tests to reduce capital volatility and improve transparency.13 While I recognize that we need to increase transparency to reflect changes in the legal environment in which we operate, there are good reasons why I and many of my colleagues and predecessors have been averse to such full disclosures since the inception of the stress test fifteen years ago. There are several risks that we will need to guard against.
    First, we need to guard against the risk that the process results in reduced capital requirements. As they did during the Basel III process, banks are likely to argue against various aspects of the Fed’s models that result in higher capital requirements, and not to highlight the areas in which the models underestimate risks. We should take those comments on the Fed’s models seriously and adjust the models as appropriate, but we should be careful not to overcorrect and lower bank capital requirements in ways that underestimate aggregate risk. The Administrative Procedure Act should be a vehicle for transparency and public input into agency action, not used to weaken regulatory requirements that preserve the safety and stability of our financial system.
    Second, we need to guard against the risk that banks lower their capital requirements because of increased transparency. Increased disclosure of details about the Fed’s stress models could enable banks to optimize stress test results by adjusting their balance sheet based on their knowledge of where the models underprice risk, in order to reduce their capital requirements without materially reducing risks. Gaming the test in this way would be a bad outcome for risk management and our economy.
    Third, banks are likely to change their behavior in other ways that increase risk. We should be aware of the risk that full transparency into the models and scenarios used by regulators could discourage banks from investing in their own risk management if the test becomes too predictable. Full transparency may also encourage concentration across the system in assets that receive comparably lighter treatment in the test. And banks are likely to reduce their management buffers over required levels, which will bring greater risks of breaching the minimums and regulatory buffers when a significant risk event eventually happens.
    The fourth risk, and perhaps the greatest one, is that over time, given the difficulty of navigating the notice and comment rulemaking process on an ongoing basis to update the models we use, the dynamism and accuracy of the stress test will fade.14 And as the events of two years ago show, it is hard to predict where risks will emerge in the financial system; an inherent challenge of preserving the relevancy of stress testing is coming up with a set of adverse scenarios that are novel enough, and dynamic enough, to reflect the risks that banks may face from unanticipated developments. I believe that the Fed should commit to investing in a credible, effective process to maintain the dynamism of the binding stress test by regularly updating its models and scenario variables to reflect changes in the environment and changes to bank behavior. This will require resources and a strong commitment up front and over time, but it will be necessary to maintain a credible stress test.
    One effort we’ve already undertaken should help: to maintain the dynamism of the stress test, we launched exploratory stress scenarios to consider a wider range of possible conditions.15 The Fed used this approach during the pandemic, and we’ve now made it a regular part of our annual stress test exercise.16 The exploratory scenarios are not used to set binding capital requirements and are only reported on an aggregate level, but they help the Fed better understand risks posed to individual banks and to the banking system as a whole that are not captured in binding scenarios. I hope and trust that the Fed will continue this important analytical work.
    As an additional backstop to help ensure banks have sufficient capital to withstand losses, the Fed should preserve its discretion to set individually binding capital requirements on firms based on supervisory judgment under the International Lending Supervision Act. Jurisdictions around the world undertake a similar process under a so-called Basel “Pillar 2” approach, and the United States would benefit from using such a framework as well. That is all the more important given the changes the Fed is undertaking for the binding stress tests.
    Maintaining Credible, Consistent SupervisionAnother area warranting continued vigilance is supervision. There will undoubtedly be calls to revamp supervision to reduce burden. And I am all for making sure supervision is the most effective and efficient it can be. Supervisors need to focus on the most urgent and important risks, and not burden firms with unnecessary or distracting matters. But we need to be careful to preserve and enhance the ability of supervisors to act with speed, force, and agility as appropriate to the risk.
    Supervisors have emphasized proactive supervisory engagement, which helps banks address issues before they grow so large as to threaten the bank or broader financial stability. Earlier intervention means that firms are likely to have more options to fix their problems, with little impact on bank profitability.17
    We should continue work to improve the effectiveness of our supervision and use data-driven analysis to improve our scoping and prioritization of supervisory issues. I support this work to the extent that it makes our supervision more effective and focused on the right issues. But the Board should resist initiatives that impede effective supervision by discouraging examiners to flag issues early, or initiatives that increase unnecessary process around issuing findings in a manner that impedes the speed and agility of supervision when it is needed. More generally, supervision is another area in which “efficiency and competitiveness” should not be used as an excuse for lax oversight that significantly impairs the safety and soundness of individual institutions and undermines broader financial stability.
    We should take caution from our experience with SVB. While some have claimed that the examiners at SVB did not focus on the right issues, it’s important to highlight that the Office of Inspector General (OIG) concluded that the Fed allocated an insufficient number of examiner resources to SVB while in the RBO portfolio, and that the examiners assigned to SVB as it was growing did not have sufficient expertise in supervising large, complex institutions.18 Once it was in the large bank portfolio, examiners highlighted the risk from interest rate risk and uninsured depositors, but did not act with sufficient force to get the bank to change course in a timely way. We’ve made important changes since then, but we need to be sure we get the staff resources in place, and provide support to examiners on the front line, so that they can act with the speed, force, and agility warranted by the facts.
    Encouraging Responsible InnovationAnother set of risks involve those related to the role of innovative technology in the financial sector. Innovation, when done responsibly, brings tremendous benefits to consumers, financial institutions, and the economy at large. For instance, blockchain technology underlying crypto-assets has the potential to make financial services better, cheaper, and faster. Responsible use of this technology could make banking more efficient and accessible to more consumers.
    With any new technology, there are new risks. To achieve the benefits in a durable manner over time, we must ensure that the associated risks are managed appropriately. With crypto-assets, investors do not currently have the structural protections they have relied on for many decades in other financial markets. It is important that those guardrails are put in place to avoid issues such as the misuse of client funds, misrepresentations, obfuscation about availability of deposit insurance, and fraud. We should also recognize that some of the attractive attributes of crypto-assets—the pseudonymous actors that are parties to transactions, the ease and speed of transfer, and the general irrevocability of transactions—also make crypto-assets attractive for use in money laundering and terrorist financing. It is encouraging to see innovators develop tools and processes to better manage these risks, while harnessing the benefits of the technology. But regulation and supervision also have an essential role to play.
    Responsible innovation is in everyone’s interest. In the past few years, we stood up the Novel Activities Supervision Program, which dedicates resources to understanding how technology is transforming banking and supports banks’ ability to innovate while ensuring that banks clearly understand and manage the risks associated with innovative activities.19 I hope and trust that approach will continue.
    Addressing Cyber and Third-Party RiskCyber risk from both foreign powers and non-state actors has become a major concern for banks, and regulators will need to ensure that these risks are being properly managed. The operational disruption propagated through a third-party security company last summer was a wake-up call for banks and regulators about vulnerabilities in a system where security is outsourced. Disruption of one of these critical systems may compromise a bank’s ability to execute important functions and adversely affect individual firm safety and soundness as well as the broader financial system. Given the significant concentration in the IT industry, we should expect operational failures at single IT entities to have potentially far-reaching effects, no matter their original cause. And advances in artificial intelligence are likely to give bad actors new tools for fraud and infiltration, while also providing banks with new tools to combat these attacks. Both banks and the Federal Reserve need to continue to invest in cyber resiliency.
    Risks in the Nonbank SectorLet me speak next to the perennial concerns of intermediation by financial firms outside the bank regulatory perimeter. An increasingly varied and evolving collection of nonbank clients, including hedge funds, private credit, and insurance companies, is playing a significant role in the global economy and presenting new risks.
    Beginning with hedge funds, bank exposures to hedge funds have risen over the past several years, and concurrently, hedge fund leverage remains near historic highs.20 Archegos’s failure revealed the risks presented by hedge funds and the degree of interconnectedness between banks and hedge funds. And the exploratory analysis as part of last year’s stress test showed that banks have material exposures to hedge funds under certain market conditions, and that the hedge fund counterparty exposures can vary significant based on the specific set of shocks.21
    One area that has grown substantially is the Treasury cash-futures basis trade.22 The basis trade helps provide liquidity and price discovery in normal times, as hedge funds trade with asset managers and other financial institutions to align returns to holding Treasury securities and related futures. But the trade involves high levels of leverage, which can contribute to a rapid unwinding in positions and exacerbate market stress, as we saw in the spring of 2020. In principle, margining practices and participants’ risk-management activities should limit these risks, but individual firms do not account for the spillovers their actions can have on market functioning. These externalities suggest a role for regulation, and the central clearing mandate for Treasury market trading is an important step in supporting the resilience of this market. At the same time, we need to continue to consider how we can support the collection of minimum margin across trading venues and in bilateral trades to avoid loopholes and risks, and continue to monitor banks’ credit risk management practices with these hedge fund counterparties.
    Another area that has experienced rapid growth in recent years is private credit, which is now comparable in size to the high-yield bond market and leveraged loan market.23 Traditional private credit arrangements rely on limited leverage and generally have long-term funding, making them less vulnerable to the deleveraging spiral associated with high leverage and short-term funding. Nonetheless, risks may be growing. The connections between private credit and banks have been expanding, and private credit remains opaque, with limited information relative to asset classes of similar size.24 Moreover, the rapid growth and opacity of the sector raise the risk that recent private credit arrangements may be assuming new risks. Retail investors can now gain exposure to the asset class through mutual or exchange traded funds, which could present the age-old consumer and financial stability risks we see when opaque, illiquid assets are converted to liquid ones.25
    We also need to monitor risks in the insurance industry. Households planning for retirement often rely on life insurance companies to provide them a steady stream of income. In principle, life insurance companies are the ultimate patient investor and thus the natural vehicle to finance long-maturity and risky projects. Indeed, while venture capital funding gets a lot of the attention, mobilized retirement savings through life insurance companies have supported long-term investments in capital-intensive projects. However, life insurance companies, just like other financial institutions, can overpromise and be tempted to take on greater risk than their liability holders or regulators appreciate. Given the complexity of some investment vehicles, the institutions themselves may not fully appreciate all of the risks. The life insurance sector has been changing. Even as the life insurance industry has been increasing its holdings of assets originated by private equity firms, private equity firms have been acquiring life insurers directly. Moreover, private-equity-affiliated insurers rely more heavily on nontraditional liabilities, which may prove flighty in a stress event. This is something to watch carefully. In the next business cycle downturn, it’s possible that unexpected losses at insurance companies could lead to a sharp pullback and deeper credit crunch.
    Climate RiskFinally, regulators will need to continue to confront the financial risks from climate change. The Federal Reserve has a responsibility to recognize emerging risks to the safety and soundness of banks, to the ability of households and businesses to access financial services, and to financial stability. Costly natural disasters could present just such risks.
    The recent wildfires in California should be a wake-up call that we need to focus on how insurance markets will need to adjust to more frequent and severe weather events. The loss of life and hardship borne by many households is tragic, and the economic losses associated with the wildfires, while uncertain, are likely to be among the largest losses from a natural disaster on record. The wildfires should remind us of the problems in property and casualty insurance markets—just as the severe flooding caused by Hurricane Helene reminded us of significant gaps in flood insurance coverage.
    Often the structure and regulation of insurance markets prevents risk from being appropriately priced, limiting the ability of market signals to influence development and adaptation in high-risk areas and contributing to the buildup of risks. And there is a broader question of the extent to which private capital will be sufficient to cover increasing natural disaster risk.
    The Federal Reserve has an important but narrow role to play with respect to climate change, and that is to focus on risks from climate change to bank safety and soundness and financial stability. The pilot climate scenario analysis conducted by the Federal Reserve was an important step forward in assessing the capacity of the largest banks, as well as in building our own capacity, to perform the kind of analysis that is increasingly crucial as risks arising from more severe weather events become a driver of financial risk for specific firms and the broader economy.26 Guidance for the largest banks also plays an important role in reminding banks of basic principles in prudent risk management as it applies to these types of climate-related risks.
    ConclusionIn conclusion, the United States has the benefit of a strong, vigorous economy, the deepest and most liquid markets in the world, and a critical place in the world economy through the role of the U.S. dollar. The Federal Reserve has an essential role in maintaining the strength and resilience of the U.S. economy, including through its vigilance about the risks I discussed today. A strong and resilient banking system benefits the American people. We need to be humble about our ability to predict shocks to the financial system, and how they will propagate through vulnerabilities in the system. That is why it is so important to have strong regulation and supervision as shock absorbers to protect households and businesses from risks emanating from the financial system.
    In closing, I want to speak directly to the staff of the Federal Reserve and express my deep gratitude. Your rigorous analysis and deep expertise are fundamental to our ability to promote a strong and stable financial system that serves the American people. Thank you for your outstanding service.

    1. The views expressed here are my own and are not necessarily those of my colleagues on the Federal Reserve Board or the Federal Open Market Committee. Return to text
    2. Board of Governors of the Federal Reserve System, Department of the Treasury, and Federal Deposit Insurance Corporation, “Joint Statement by Treasury, Federal Reserve, and FDIC,” press release, March 12, 2023; and Board of Governors of the Federal Reserve System, “Federal Reserve Board Announces It Will Make Available Additional Funding to Eligible Depository Institutions to Help Assure Banks Have the Ability to Meet the Needs of All Their Depositors,” press release, March 12, 2023. Return to text
    3. See, e.g., U.S. Department of the Treasury, “Remarks by Assistant Secretary Michael Barr” (speech at the Financial Times Global Finance Forum, New York, NY, December 2, 2010). Return to text
    4. See, e.g., speeches by Michael S. Barr: “Why Bank Capital Matters” (speech at the American Enterprise Institute, Washington, D.C., December 1, 2022); “Holistic Capital Review (PDF)” (speech at the Bipartisan Policy Center, Washington, D.C., July 10, 2023); “The Next Steps on Capital” (speech at the Brookings Institution, Washington, D.C., September 10, 2024); and “On Building a Resilient Regulatory Framework” (speech at Central Banking in the Post-Pandemic Financial System 28th Annual Financial Markets Conference, Fernandina Beach, FL, May 20, 2024). Return to text
    5. Board of Governors of the Federal Reserve System, “Agencies Request Comment on Proposed Rules to Strengthen Capital Requirements for Large Banks,” press release, July 27, 2023. Return to text
    6. by Michael S. Barr: “The Next Steps on Capital” (speech at the Brookings Institution, Washington, D.C., (September 10, 2024). Return to text
    7. See “Vice Chair for Supervision Michael S. Barr memo” in Board of Governors of the Federal Reserve System, Review of the Federal Reserve’s Supervision and Regulation of Silicon Valley Bank (PDF) (Washington, April 2023). Return to text
    8. See “Discount Window Readiness”. Return to text
    9. For an earlier perspective, see Hearing on Prudential Oversight before the Senate Committee on Banking, Housing and Urban Affairs (PDF), July 23, 2015 (statement by Michael S. Barr). Return to text
    10. 12 CFR 249. 32-33. Board of Governors of the Federal Reserve System, Review of the Federal Reserve’s Supervision and Regulation of Silicon Valley Bank (Washington, April 2023); and Federal Deposit Insurance Corporation, FDIC’s Supervision of First Republic Bank (PDF) (Washington: September 2023). Return to text
    11. Board of Governors of the Federal Reserve System, Financial Stability Report (PDF) (Washington: November 2024). Return to text
    12. Board of Governors of the Federal Reserve System, “Agencies Request Comment on Proposed Rule to Require Large Banks to Maintain Long-Term Debt to Improve Financial Stability and Resolution,” press release, August 29, 2023. Return to text
    13. Board of Governors of the Federal Reserve System, “Due to Evolving Legal Landscape and Changes in the Framework of Administrative Law, Federal Reserve Board Will Soon Seek Public Comment on Significant Changes to Improve Transparency of Bank Stress Tests and Reduce Volatility of Resulting Capital Requirements,” press release, December 23, 2024. Return to text
    14. That model sclerosis contributed to the failure of the supervisory stress test used for Fannie Mae and Freddie Mac before the Global Financial Crisis, with devastating results. Scott Frame, Krisopher Gerardi, and Paul Willen, “The Failure of Supervisory Stress Testing: Fannie Mae, Freddie Mac, and OFHEO,” Federal Reserve Bank of Boston Working Paper No. 15-4 (October 2015). Return to text
    15. Board of Governors of the Federal Reserve System, Exploratory Analysis of Risks to the Banking System (PDF) (Washington: June 2024). Return to text
    16. Board of Governors of the Federal Reserve System, Assessment of Bank Capital during the Recent Coronavirus Event (PDF) (Washington: June 2020). Return to text
    17. Beverly Hirtle and Anna Kovner, “Bank Supervision,” Annual Review of Financial Economics 14 (2022): 39–56. Return to text
    18. Office of Inspector General, Material Loss Review of Silicon Valley Bank (PDF) (Washington: September 25, 2023). Return to text
    19. See https://www.federalreserve.gov/supervisionreg/novel-activities-supervision-program.htm. Return to text
    20. Board of Governors of the Federal Reserve System, Financial Stability Report (PDF) (Washington: November 2024). Return to text
    21. Board of Governors of the Federal Reserve System, Exploratory Analysis of Risks to the Banking System (PDF) (Washington: June 2024). Return to text
    22. Board of Governors of the Federal Reserve System, Financial Stability Report (PDF) (Washington: November 2024). Return to text
    23. Board of Governors of the Federal Reserve System, Financial Stability Report (PDF) (Washington: November 2024). Return to text
    24. John Levin and Antoine Malfroy-Camine, “Bank Lending to Private Equity and Private Credit Funds: Insights from Regulatory Data,” Federal Reserve Bank of Boston Supervisory Research and Analysis Notes (February 2025). Return to text
    25. Chapter 2 The Rise and Risks of Private Credit in: Global Financial Stability Report, April 2024. Return to text
    26. Board of Governors of the Federal Reserve, Pilot Climate Scenario Analysis Exercise: Summary of Participants’ Risk-Management Practices and Estimates (PDF) (Washington: May 2024). Return to text

    MIL OSI USA News

  • MIL-OSI USA: Governor Stein Provides Update on Winter Weather, Urges Caution on Treacherous Roads

    Source: US State of North Carolina

    Headline: Governor Stein Provides Update on Winter Weather, Urges Caution on Treacherous Roads

    Governor Stein Provides Update on Winter Weather, Urges Caution on Treacherous Roads
    lsaito

    Raleigh, NC

    Today, Governor Josh Stein and the State Emergency Response Team are providing further updates on the state of winter weather, as well as resources for North Carolinians who are impacted by the storm. Governor Stein advises that all North Carolinians continue to pay attention to their local weather forecasts and stay off the roads as much as possible.  

    “As winter weather continues today, we are doing everything we can to keep North Carolinians safe and respond to the effects of the storm” said Governor Josh Stein. “Frigid temperatures and wet roads are making travel dangerous, resulting in one tragic fatality. Please stay off the roads if you can. If you need help, reach out to your county’s emergency operations center or the North Carolina Disaster Case Management hotline. Please stay safe and check on your neighbors to ensure that they’re safe too.”

    As of noon today, there are an estimated 6,105 power outages statewide, with the majority of those outages in eastern North Carolina communities impacted by ice. The State Emergency Response Team remains activated to support local first responders, energy providers, and the NC Department of Transportation, with the NC National Guard remaining in central and eastern North Carolina to assist on the roadways. This includes 188 guardsmen with 60 vehicles.  

    Officials with the NC Department of Transportation are urging people to avoid unnecessary travel today, as many of the state’s snow-and-ice covered roads are treacherous. The agency has seen numerous crashes yesterday and overnight, including one confirmed fatality, due to people losing control of their vehicles.

    Since the first snow began to fall Wednesday morning, NCDOT’s maintenance crews and contractors have been hard at work clearing roads of ice and snow. More than 2,300 NCDOT employees, in addition to the agency’s contractors, are operating more than 2,200 trucks and motor graders to treat roads. NCDOT officials have used more than 12,650 tons of salt to treat roads since snow began to fall.  

    NCDOT’s cut and shove teams are removing fallen trees and debris from roads and working with the agency’s utility partners in cases involving downed power lines.  NCDOT is prioritizing clearing the interstates and then US and NC routes, followed by secondary roads.

    “Our crews are working around the clock to clear roads across the state and will not stop until the job is done,” said NCDOT Secretary Joey Hopkins. “The snow and ice dumped on our state have left many roads too dangerous for travel. If you don’t need to be on the roads, please stay home and stay safe.”  

    Much of the state is not expected to see significant thawing until Friday afternoon, when temperatures will climb above freezing. Road conditions will continue to be dangerous for several mornings as overnight temperatures leave behind black ice on many roads.  When conditions improve, people should check the state’s real-time travel conditions on DriveNC.gov before heading out.

    For information on power outages and how your and your family can be prepared for continued winter weather and cold temperatures, visit www.readync.gov.  

    Hurricane Helene disaster survivors can reach FEMA for help today by calling 1-800-621-3362. The physical FEMA Disaster Recovery Centers across western North Carolina will be closed today due to weather conditions.  

    The North Carolina Disaster Case Management Program (NC-DCM) remains available for Helene survivors. To access resources and assistance, call 1-844-746-2326 or visit www.ncdps.gov/helene/dcm. To date, NC-DCM has handled applications from 2,143 survivors and fielded at least 5,676 calls for assistance with needs including housing, financial, navigating FEMA assistance, food, and furniture or appliances. 

    Feb 20, 2025

    MIL OSI USA News

  • MIL-OSI Global: Inside Porton Down: what I learned during three years at the UK’s most secretive chemical weapons laboratory

    Source: The Conversation – UK – By Thomas Keegan, Senior Lecturer in Epidemiology, Lancaster University

    When I first arrived at the top secret Porton Down laboratory, I was aware of very little about its activities. I knew it was the UK’s chemical defence research centre and that over the years it had conducted tests with chemical agents on humans.

    But what really happened there was shrouded in mystery. This made it a place which was by turns fascinating and scary. Its association with the cold war, reinforced by images of gas mask-wearing soldiers and reports of dangerous (and in one case fatal) experiments, also made it seem a little sinister.

    The shroud of secrecy resulted in it being the subject of some lively fiction, such as The Satan Bug by Alistair MacLean, which revolves around the theft of two deadly germ warfare agents from a secret research facility and in the “Hounds of Baskerville” episode of the BBC drama Sherlock in which the hero uncovers a sinister plot involving animals experiments.

    Even Porton’s own publicity material recognises that where secrecy exists imagination can take flight, and attests:

    No aliens, either alive or dead have ever been taken to Porton Down or any other Dstl [Defence Science and Technology Laboratory] site.

    But it’s also the place where in recent years scientists analysed samples confirming that a Novichok nerve agent had been used to poison former Russian spy Sergei Skripal and his daughter (coincidentally, just a few miles away). And where an active research programme on Ebola played an important role in the UK’s support to Sierra Leone during the 2014 outbreak.

    So what is the truth? Over three years my research took me into the heart of the mystery, as I studied its extensive historical archive. The reality was not as I expected. I came across no aliens, but I did discover records of experiments that ran from the ordinary, through to the bizarre. And sadly, in one isolated case, the lethal.

    Arriving at Porton Down, for example, was unexpectedly low key. The main gate is located off a public road on an otherwise quiet stretch between Porton Down village and the A30. It is in many ways visually similar to the entrance to Lancaster University in the north of England where I work as a lecturer in epidemiology.

    Bar some signs announcing it as the Defence Science and Technology Laboratory (dstl) of the Ministry of Defence, the road is devoid of obvious security. No barriers block entry. This sense of the extraordinary hiding behind the ordinary was reinforced by the undistinguished visitor car park from where it is a short walk to the nondescript single story reception building.

    There is also (perhaps unusually for a government chemical weapons research centre) a bus stop next to the main gate, from where you can get the number 66 to Salisbury.

    So on my first visit in 2002 I made that short walk from the visitor car park to the reception and announced myself. I was pleased to find I was expected and looked into the security camera as bidden. After a hard stare from the receptionist I was issued, on that my first day, with a temporary pass. On it was written: “MUST BE ACCOMPANIED AT ALL TIMES” in bright red.

    My contact, Dawn, arrived and led me through the main gate where security started to become more obvious. An armed policeman gave us a small nod as we passed through, his hands staying firmly on the machine gun strapped to his chest. Dawn paid little attention other than a brief hello and we were inside, heading to the headquarters.

    It was from here that the management of Porton Down organised the programmes of testing which had ultimately resulted in my presence there – to research the health effects of chemical experiments on humans.


    The Insights section is committed to high-quality longform journalism. Our editors work with academics from many different backgrounds who are tackling a wide range of societal and scientific challenges.


    Since its inception in 1916 it has researched chemical weapons, protective measures against chemical weapons, and has recruited over 20,000 volunteers to participate in tests in its research programmes.

    Hut 42 – opening the archive

    This archive was opened to my colleagues and I after previously being firmly hidden from public view. This shift in approach was the result of government approval for a study into the long-term health of the human volunteers. The action was triggered by complaints from a group of people who had been tested on and who claimed their health had been damaged as a result.

    The government was also keen to ward off accusations of cover ups. In 1953 Ronald Maddison, a young RAF volunteer, died in a nerve agent experiment at the site. The original inquest was held in secret and returned a verdict of misadventure. But in 2004 the government ordered a second, public, inquest.

    This, along with a police investigation into the behaviour of some of the Porton Down scientists persuaded the government to fund independent research into the health effect of the experiments.

    A research group from the department of public health at the University of Oxford won IS WON RIGHT WORD? sk I was part of that group. Porton participated fully and opened its doors and archive to the project. I went ahead of the research team to deal with the practicalities of gaining access. My first task was to set up an office. So Dawn led me onwards to the building that had been put aside for our use.

    We passed into the inner, more secure, area. This part of Porton Down was where the main scientific work was carried out. This inner secure area was surrounded by a high chain link fence and there was one principal entry point, next to a guard room.

    Inspecting our passes was another armed MoD police officer. Alerted by my red pass he was all for barring my way until Dawn stepped in. Now vouched for, we were waved through and passed onwards to the building that would become my home for the best part of three years – hut 42.

    ‘People had neat handwriting then’

    Hut 42 was a nondescript redbrick, single-story building, which sits next to the main library and information centre and from the outside could be mistaken for a school boiler room. In it were five desks and several metal filing cabinets closed with combination locks.

    Our purpose there was to study the historical archive, including the handwritten books of experiment data. We then transferred that material into a database for later analysis. This process took four people two years of hard work, but we were lucky.

    Porton Down’s record keeping was excellent. Early on I had worried that handwritten records would be hard to decipher and had asked a Porton Down librarian whether they would be legible. “Definitely”, was the reply. “People had neat handwriting then. It’s the records from the 1970s you’ll have to watch. They’re dreadfully scrappy,” he said.

    And so it was proved. The records of tests from an era before computers, carried out with substances such as mustard gas, were routinely neatly and clearly documented.

    Porton Down experiment book, showing drop tests to the arms during one of the first nerve agent tests.

    A picture of a page in one of the experiment books on which is recorded the first nerve agent test for Tabun on April 10, 1945.
    Thomas Keegan

    I met Porton Down’s resident medical doctor in the archive to start discussing the nature of the experiments. Simon (not his real name) was in his mid-thirties with boyish curly hair and an anorak. “You’ll find everything you’ll need in here, in these cupboards,” he said. “First, I’ll show you how to open the cupboard. It’s like this”, he said. “A five number combination. Five times anticlockwise to reach the first number, four times clockwise for the second, three times anticlockwise for the third and so on.”

    There was a pause while he demonstrated. “Sometimes they can be a bit sticky”, he said after the first attempt. He got the cupboard open on the second try.

    The archive was a mixture of handwritten experimental and administrative records. The administrative records were essentially lists of attendees with dates and personal characteristics such as age. The experimental records reported the results of the tests with people in a variety of ways. Some were in the form of descriptive text, others used pictograms to record the site visually, for example where a drop of mustard gas was placed on the skin. Many contained tables of data, all hand drawn and as legible as if they had been printed. Our cupboards contained around 140 such books spanning a period from the start of the second world war to the end of the 1980s.

    The story the records told was a fascinating one.

    In the 50 years following the outbreak of the second world war, Porton Down encouraged over 20,000 men, nearly all members of the UK armed forces, to take part in experiments at the site.

    These men (the regular armed forces had yet to admit women) took part in a programme of tests that ran from experiments using liquid mustard “gas” dropped onto bare skin to inhalation of nerve agents. There were also tests with antidotes and other gasses and liquids too.

    Chemical experiments

    The records show that between 1939 and 1989, over 400 different substances were tested at Porton. Mustard gas, sarin, and nitrogen mustard were frequently tested. These chemicals are known as “vesicants” for their ability to cause fluid filled blisters (or vesicles) on the skin or any other site of contact. First world war soldiers were familiar with the horrors of this gas, which was first used by Germany at the Battle of Ypres in 1915. John Singer Sergeant’s powerful painting Gassed expressed the effect of mustard gas on soldiers exposed in the trenches.

    Other major chemical tests were riot control agents, such as CS and CR, these being the only chemicals tested that have been used by UK forces in peacetime, their purpose being crowd control.

    Mostly, we were kept far away from anything other than paper records. As Britain had given up its chemical arsenal and any offensive capability in the 1950s, there was, as Simon had explained, no stores of chemical agents at Porton Down, except of course, small amounts of those that were needed to test human defences. By a circuitous route however, I came nearer to some than I was expecting.

    ‘Would you like a sniff?’

    Hut 42, was not, it turned out, wholly for our use. While some Porton staff shared access to the archive and popped in now and then to examine records and take photocopies, the building had one other permanent resident – Porton Down’s in-house historian Gradon Carter. Carter was in his late 70s and had worked at Porton Down as an archivist for more than 20 years. He prided himself on knowing more than anyone alive about the history and administration of the institution.

    He wore tweed and had the air of a world weary Latin master, but rather than the accoutrements of his trade being Latin textbooks, his were the paraphernalia of chemical warfare. Around his desk were examples of gas masks from various periods of history, and on the wall, posters inviting people to “always carry your gas mask”.

    One of his exhibits was a box, about the size of a packet of breakfast cereal, which contained glass phials, each carefully labelled with the contents. These included mustard gas, lewsite and phosgene.

    The box was from the 1940s. It was a training tool to help troops recognise different gasses on the battlefield. “Would you like a sniff of mustard?”, he offered. It so happened I did. Nearly 60 years after it was first bottled, I can report that Carter’s mustard gas had very little smell, but I was reluctant to get close to test any of its other properties. He re-corked it. “Some lewisite?” he suggested.

    Lewisite was produced in 1918 for use in the first world war but its production was too late for it to be used. Another vesicant, it causes blistering of the skin and mucous membranes (eyes, nose, throat) on contact.

    I declined Carter’s kind offer.

    Other chemicals appeared in the records less frequently. There were the lovely vomiting agents, which are designed to winkle their way under your gas mask to make you sick, which will make you take off your gas mask making you vulnerable to the next wave of attack by, for example, nerve agents.

    These agents were relatively standard members of a chemical arsenal. In an effort to expand its horizons, Porton Down opened its collective mind in the early 1960s to the usefulness of psychedelics in warfare and tested LSD for its potential as a disruptor of enemy military discipline.

    The tests showed that troops became unable to put up much of a fight, but ultimately the chemicals were rejected as means of mass disruption. You can see a video of a test at Porton Down with LSD below.

    In the video, a troop of Royal Marines can be seen taking part in an exercise during which they are given LSD. Not long afterwards the men become barely capable of military action and seem to find almost everything funny. One man seems not to know which end of a bazooka to point at the enemy.

    The most commonly tested substances at Porton, according to our data, were mustard gas, lewisite and pyridostigmine (more of which later) with thousands of tests undertaken. Less frequently tested were a basket of chemicals including sodium amytal (a barbiturate) and more strangely perhaps, 49 tests with pastinacea sativa – the irritant wild parsnip.

    Not all men who took part in tests did so with chemical agents. Many visited Porton Down and were “tested” with substances that were not intended to be harmful but which must have been providing useful information of some kind. Some people were tested with “lubricating oil” (498 people) and “ethanol” (204 people). Many tests were with protective equipment such as materials for protective suits and with respirators.

    Nerve agent tests

    Around 3,000 people were tested with nerve agents. The number of nerve agents tested was not extensive, with six principal agents recorded. These were tabun, (known as GA), soman (GD), sarin (GB), cyclo sarin (GF), and methylphosphonothioic acid (VX).

    The period of nerve agent research ran from the early postwar period to the late 1980s, and coincided with the cold war, when military tension between the Nato countries and the USSR was high.

    The archive was rich in information on these tests. The records included detail of the time and place of each test along with details of who took part, noting both staff and volunteer participants. Records on the early tests are especially revealing.

    Chambers like this were used to carry out tests on nerve agents.
    Thomas Keegan

    For example, in 1945 nerve agents were not yet known to Porton Down scientists. They had come close to discovering nerve agents when they had worked on PF-3, a chemical of the same organophosphate type as the nerve agents, but they had not thought it sufficiently toxic.

    However, these agents were well known to German scientists, and to the German military who weaponised them during the second world war. Despite fears to the contrary, gas was not used in the fighting, though Germany had clearly prepared for chemical warfare.

    Nazi agents and gin and tonic

    Advancing US forces moving through Germany came across stockpiles of artillery shells in a railway marshalling yard near Osnabrück that contained suspicious liquids. The markings on the shells – a white ring on one type and green and yellow rings on the other – were new to the Americans. The shells were sent to the US and Porton Down for investigation.

    After initial analysis, Porton scientists found that the shells with the white ring contained tear gas. The other contained an unknown substance (later it would be named tabun).

    Tabun is one of the extremely toxic organophosphate nerve agents. It has a fruity odour reminiscent of bitter almonds. Exposure can cause death in minutes. Between 1 and 10 mL of tabun on the skin can be fatal.

    On April 10 1945, after some laboratory tests, the scientists decided to test the new chemical on people. In fact, as Carter pointed out to me, disaster could have struck immediately as the first nerve agent to arrive at Porton for testing was transported to the lab in a test tube stoppered only with cotton wool.

    Thinking this was a new variety of mustard gas, they placed drops on the participants’ skin. The scientists also placed drops in the eyes of some rabbits. The records show that before any serious effect to the humans could be noted one of the rabbits died, giving the scientists running the tests a fright.

    The chemical was quickly wiped off the men’s arms and the test ended there. According to a brief memoir supplied by Carter, Dr Ainsworth (who was involved in the tests) said that Captain Fairly (the Porton scientist being tested on) had been shaken by the experience but recovered “after a stiff gin and tonic in his office”.

    This sporting attitude to self-testing was not uncommon among scientists, however. Dr Ainsworth later tested a method for reducing the effect of a splash of nerve agent on the skin which involved a tourniquet and opening a vein – something he thought worked well.

    But he was used to the pioneering methods of the day. “Taste this,” the pharmacologist John (later Sir John) Gaddum had ordered on one previous occasion. Dr Ainsworth sipped the liquid offered and reported that it tasted a little like gin. “That’s strange”, Professor Gaddum said. “I can’t taste anything. It’s diluted lewisite and the rats simply won’t drink it.”

    Back at the wartime testing lab they were keen to find out more about what was now understood to be a new type of chemical agent developed by German scientists and weaponsied by their armed forces. The following week, ten people were exposed in a chamber, at the higher concentration of 1 in 5 million. In the pioneering spirit not uncommon at Porton, four of the subjects: Commandant Notley, Major Sadd, Mr Wheeler and Major Curten were Porton staff. Major Curten reported having a tightness of chest, and a slight contraction of the pupils, unlike the commandant who had no reaction but thought the gas smelled of boiled sweets.

    An undated photograph of the southern end of the Porton Down campus showing the bus stop outside. The grey building is thought to be one of the exposure chambers.
    Thomas Keegan

    Later that morning the scientists had another go, this time at a higher concentration, 1 in 1 million. The symptoms were now more noticeable, with more than one person vomiting and others needing treatment the following day for the persistent symptoms of headaches and eye pain.

    Given what we have since learned about tabun, it seems at the very least cavalier of the scientists to conduct these tests on themselves and others. They were were lucky not to have been seriously injured or even killed, but those were the risks they seemed willing to take.

    Fatal consequences

    The last entries in the archive for nerve agent tests were for 1989 so newer compounds such as novichok, used in an attempted assassination in nearby Salisbury, were not included. One later nerve agent tested in the 1960s was VX, then a scarily potent new nerve agent.

    According to the Centers for Disease Control in the US, VX is one of the most toxic of the known chemical warfare agents. It is tasteless and odourless and exposure can cause death in minutes. As little as one drop of VX on the skin can be fatal.

    It was not developed into a weapon by the UK, as by then it had abandoned an offensive capability, but tests were carried out on a relatively small number of volunteers. I mentioned VX to Carter. He recalled that the first sample of VX was first discovered, accidentally, at an ICI chemical factory in the UK and sent to Porton in the regular post. Luckily, nobody was exposed.

    In one notorious episode however, the tests of nerve agents on humans did not go as expected.

    As I referred to earlier, in 1953, during an early nerve agent experiment, the young airman, Ronald Maddison died. Testing was paused at Porton after an inquiry by the eminent Cambridge academic Lord Adrian and limits on exposures were set after resumption in 1954. A second inquest into the death returned a verdict of unlawful killing in 2004.

    While no charges were made against the scientists involved, the Ministry of Defence agreed to pay Maddison’s family £100,000 in compensation.

    One of the founders of the Porton Down Veterans Group, Ken Earl was in the same experiment. He remembered vividly being in the same chamber as Maddison, and while not affected seriously at the time, felt his health issues later in life were directly related to the test. In an interview with the BBC, he attributed the many health problems he suffered through his life, including skin conditions, depression and a heart irregularity, to his experience at Porton Down.

    Our research could not establish a direct link to the kind of ill health Earl suffered. But our data on the short-term effects did show a good deal about the immediate aftermath of a nerve agent exposure, similar to the type Earl experienced.

    The physiological effect of exposure to nerve agents varies greatly between individuals as our previous research has shown. The strength of symptoms varies too. Five of the six participants in the same test as Maddison did not report adverse effects other than feeling a bit cold.

    However, tests before this had shown that certain effects were consistently seen with nerve agent exposures. In July 1951 six people participated in a test with soman. The lab book notes:

    5/5 experienced pain in eyes, blinker effect and blurred vision 30 minutes after exposure (these symptoms continued for 24 hours). 1 participant vomited 4 hours after exposure. 2 participants vomited 24 hours after exposure. Eye pain and vision improved after 48 hours but not normal – return to normal after 5 days. 4/5 given multiple doses of atropine.

    While these effects must have been unpleasant, it is also shown that participants in nerve agent tests had between one and two “exposures”. Those in tests with other chemicals such as mustard gas may have had many.

    To further regulate exposures, strict limits on the amount of nerve agent allowed in tests were imposed after Maddison died. The levels of exposure typically experienced by servicemen induced: pinpoint pupils (miosis), headaches, a tightness in the chest and vomiting. These symptoms recur many times in the records, as does documentation of the drugs used to treat them, typically atropine and pralidoxime.

    A new era

    Despite the range of agents which have been developed, chemical weapons have rarely been used by states in conflict, perhaps held back by adherence to the Chemical Weapons Convention or by their difficulty of use.

    Despite this they were used by Iraq (not then bound by the CWC) in the Iran-Iraq war (1980-88), who used mustard gas and tabun against Iranian troops. They have also been used by states against civilians – for example by Iraq against its Kurdish population and more than once by Syria against its civilian population between 2014 and 2020.

    In 2017, North Korean agents used VX to assassinate Kim Jong-nam, North Korean leader Kim Jong-un’s half-brother in Kuala Lumpur, Malaysia. And more recently the Russian opposition leader Alexei Navalny was poisoned with a nerve agent. He later recovered only to die in a Russian prison in early 2024.

    These are not just remote threats. As I previously noted, a particularly high-profile example of a state using a chemical weapon to kill someone took place in the UK in 2018 when it is alleged that the Russian state tried to kill an ex-KGB spy using small quantities of the then new and especially toxic nerve agent Novichok.

    Sergei Skripal, the intended victim, and his daughter Yulia survived the attack.

    A public inquiry heard how the Skripals were found slumped in a park in Salisbury. While the presence of nerve agents was not at first suspected, the emergency services noted how the Skripals suffered from a range of symptoms including pinprick pupils, muscle spasms and vomiting. For those experienced with nerve agents these symptoms are typical.

    But these symptoms were not known to Nick Bailey, a detective sergeant who had been assigned to check over a house in Salisbury, home to the two people that had recently been found collapsed. This should have been routine but the first indication to DS Bailey that something was amiss was when he looked in the mirror.

    His pupils, normally wide open at this time of night, had shrunk into pinpricks. He was also beginning to feel very strange. But it was when Bailey’s vision fractured and he vomited that he knew something was seriously wrong.

    It would later become clear that the agents sent to kill Skripal had sprayed the liquid nerve agent onto the door handle of the Skripal house. Sergei and his daughter both used the handle and were poisoned. So was Bailey, who had closed the door and locked it after his checks on the house later that evening.

    Four months later, the boyfriend of Dawn Sturgess found a discarded perfume bottle in nearby Amesbury, picked it up and then later gave it to her as a present. Neither could have imagined it had been used to bring Novichok to Salisbury and left behind by the attackers. Sturgess died after spraying the contents onto her skin. Her boyfriend survived.

    It was in partnership with experts at Porton Down that the local health services were able to treat the victims. According to the inquiry, a key challenge was for the hospital to work out what had poisoned the Skripals so they could treat them effectively. Porton Down worked nonstop to determine what type of nerve agent had been used. Once the cause was known the hospital was able to save the Skripals’ lives.

    That Porton Down is situated just a few miles from Salisbury where the Novichok attack took place was probably useful to those treating victims. The Russian state however, used this proximity to try to muddy the waters of accountability for the poisoning, but there seems little doubt that blame for the nerve agent poisoning lies with Russia.

    Despite the efforts of those agents, five out six people poisoned with Novichok survived, not unscathed perhaps, but alive. That they did so is in some way the result of the expertise and knowledge gained over years of nerve agent research at Porton Down.

    It seems clear that the more information about the effects of nerve agent exposure that are known outside specialist research circles the better. Though nerve agent attack is extremely rare the events in Salisbury and Amesbury have shown they are not impossible.


    For you: more from our Insights series:

    To hear about new Insights articles, join the hundreds of thousands of people who value The Conversation’s evidence-based news. Subscribe to our newsletter.

    The research study that took Thomas Keegan to Porton Down was led by the University of Oxford and funded by the Medical Research Council.

    ref. Inside Porton Down: what I learned during three years at the UK’s most secretive chemical weapons laboratory – https://theconversation.com/inside-porton-down-what-i-learned-during-three-years-at-the-uks-most-secretive-chemical-weapons-laboratory-248376

    MIL OSI – Global Reports

  • MIL-OSI Global: German election: why most political parties aren’t talking about the climate crisis

    Source: The Conversation – UK – By Vera Trappmann, Professor in Comparative Employment Relations, University of Leeds

    MDV Edwards/Shutterstock

    After months of wrangling over public debt and spending decisions, the German government collapsed in November 2024. Among the many disagreements between the parties which made up the governing coalition was how to pay for measures to combat climate change.

    Seeking to take advantage of disillusioned voters (who in recent years showed record support for the Greens), populist parties have since cast doubt on the idea of tackling environmental issues at all.

    Alternative für Deutschland (AfD), for example, the rightwing party which denies the existence of man-made climate change, has raised concerns about energy security and the economic cost of green alternatives.

    If the AfD’s broader aim was to take green issues off the political agenda, the plan appears to be working. In the run-up to the general election on February 23 2025, migration and the economy are the most important issues for voters (each on 34%), with climate change lagging far behind (13%).

    Nor has the environment been a priority in the parties’ election campaigns. In the first TV debate between the chancellor, the social democrat Olaf Scholz, and his most likely successor, the conservative Friedrich Merz, the topic was ignored almost entirely. A lack of political will and fear of losing voters appear to have relegated environmental policies to the sidelines.

    Others want it back at the top of the agenda. Germany’s foreign intelligence service, for example, describes the climate crisis as one of the major risks facing the country, alongside terrorism and war.

    Business associations have urged the next government to address climate change mitigation for the sake of German jobs. The Federation of German Industries has demanded an increase in public spending on climate change of as much as €70 billion (£58 billion). Younger voters have called for a nationwide protest to bring the subject back into politicians’ minds.

    So have German voters really become sceptical about dealing with climate change?
    In a recent study, we found that people who planned to vote for the AfD and the leftwing populist BSW party are indeed sceptical of the need for far-reaching climate policies.

    Among voters of these two parties, only 23% (AfD) and 41% (BSW) think that an energy transition is necessary to achieve national climate goals. For Green party voters that figure is 93%, and for SDP supporters it’s 83%.

    Voters across the political spectrum have different priorities when it comes to energy supply. For populist party supporters, energy costs trump everything, with only 12% of AfD and 20% of BSW voters considering low emissions important.

    These voters are also less likely to assume the energy transition would have positive effects on jobs, and are more likely to fear rising energy costs and security of supply. In short, they are afraid of the social and economic consequences of the energy transition. It is this fear that the far right appears to have been able to mobilise.

    Climate costs

    Our results are backed up by other research which shows that poorer voters are concerned about the potential costs associated with net zero ambitions.

    There is also uncertainty about the possible effects on employment. Many people in Germany believe there will be job losses in their local community as a result of the transition to green energy, and 25% worry they will lose their job.

    Climate change protest in Berlin in 2024.
    D Busquets/Shutterstock

    While these results may seem gloomy, we also found majority support – even among AfD voters – for climate change policies where communities benefit financially from local renewable energy projects, and where citizens feel they have more of a voice in how the energy transition comes into effect.

    People want to be heard and participate in a potential transformation. Previous research in psychology has shown that participating in processes and a perception of fairness can increase acceptance.

    Research also shows that people fear the effects of climate policies on their personal finances, and that these perceived costs inhibit environmentally friendly behaviour.

    But the climate crisis won’t go away, no matter who governs Germany in the coming years. More “once-in-a-century” floods and droughts will hit the nation and bring the climate crisis back to the top of the political agenda.

    When this happens, politicians need to ensure they have a positive and credible vision of the future ready to present to voters – where the costs are shared fairly. This will make it harder for populist parties to play on economic worries, and easier to persuade German voters to prioritise the climate crisis.

    Vera Trappmann receives funding from Hans Böckler Foundation

    Felix Schulz receives funding from the Hans-Böckler-Foundation.

    ref. German election: why most political parties aren’t talking about the climate crisis – https://theconversation.com/german-election-why-most-political-parties-arent-talking-about-the-climate-crisis-249731

    MIL OSI – Global Reports

  • MIL-OSI Global: Five ways to have more constructive climate conversations

    Source: The Conversation – UK – By Anastasia Denisova, Senior Lecturer in Journalism, University of Westminster

    ShotPrime Studio/Shutterstock

    Talking about climate change is never easy. The issue is complex and upsetting. Headlines bring bad news way more often than good ones.

    Techniques based on the extensive analysis of theories and research from social psychology, sociology, environmental and media studies can pave the way for a consistent approach to climate action commitment and citizen empowerment.

    Here are five ways to communicate climate stories in a way that keeps people engaged and motivated to take positive action.

    1. Give people agency

    According to the seminal research published in 1974 by the Canadian-American social psychologist Albert Bandura, humans are capable creatures who can overcome fears and lead happier, motivated lives when led correctly. He conducted a famous experiment with people who were afraid of snakes.

    In one scenario, an assistant was holding a snake in their hands or keeping it in a cage, while the scared person was watching. In another scenario, the person was given a snake to hold, in a controlled environment, with the assistants eager to take the snake back at any signs of the person’s discomfort. Bandura discovered that looking at someone holding a glossy, hissy reptile did not improve one’s sense of empowerment much.

    However, actually handling the scary creature allowed people to feel more in control – and more likely to overcome their fear. This approach is known for boosting people’s sense of agency. By tackling the problem with one modest action at a time, a person is likely to become more reassured in their capacity to challenge larger issues.

    In terms of climate communication, we need to be able to control at least small bits of the situation in order to be psychologically equipped to tackle bigger challenges. Climate communicators can give practical suggestions on lifestyle amendments, feasible activism techniques, political involvement – to nourish the sense of empowerment in the audience.

    2. Localise the issue

    While researching for my new book, Effective Climate Communication, I discovered that many countries with fewer resources struggle to present local stories related to climate change. They tend to rely on the western agenda of UN climate summits or global reports.

    The shortage of correspondents on the ground (see studies on Sub-Saharan Africa, Nigeria and South Africa, countries in South America and Asia), makes many media in the developing countries ignore the very local consequences of the global heating. When people are less prepared for extreme weather, they’ll be less empowered to demand change from their governments or invest in weather-resilient crops and other prevention techniques.

    By capturing perspectives from the local businesses and scientists, people can talk more easily about the direct effects of climate change on the local environment.

    For instance, Greenpeace Indonesia focused on three themes on their Instagram page: the imagery of floods and humans affected, the call to switch to renewable energy, and the argument against the “omnibus” bill, which allows coal companies renew their licenses easily every ten years.

    Connecting the local impact of climate change with the possible solution – reducing coal mining – brought a considerable number of clicks and comments to the stories. Although the link between Instagram and public opinion is hard to prove, the omnibus bill is still widely contested by Indonesian society.

    3. Make stories relatable

    Unless you’re called Elon Musk, Bill Gates (the co-founder of Microsoft) or Ursula von der Leyen (president of the European Commission), you don’t have a direct control over the management of climate change at a global level. Yet, it would be amazing to hear more stories of people who may be giving up long-haul flights, rejecting meat and divesting their pension from the fossil fuel funds. There are so many stories that can be told to inspire feelings of connection and hope.

    Stories must be made relatable to engage a wider audience in positive climate conversations.
    fizkes/Shutterstock

    According to classic “social proof” theory, if we can be sure that any new behaviour is the social norm, then we’ll be more eager to change. The moment people consider that refraining from eating meat, flying and buying unnecessary stuff are common patterns in their social circles, they will find it easier to follow suit, as shown by this study on the flying intentions of Germans, or research on the effect of social communities on pro-climate decisions in Europe.

    4. Avoid ‘doomism’

    Watching thrillers about the end of the world on the TV screen can be escapist and weirdly soothing. But witnessing the apocalypse unfold in front of us, through multiple news notifications and social media posts, is less gratifying. The narratives that compare climate change to the end of the humanity are supposed to incite action – but more often than not they lead to freeze or withdrawal reactions.

    In some newsrooms, the practice of “the three Ds” flourishes in the face of the planetary problem – denial, delay-ism and dismissal. Doomist storytelling opens the doors for fake prophets and self-proclaimed superheroes who promise to fix the problem but end up in populism and scapegoating.

    Avoiding doomism allows for “stubborn optimism”, a concept endorsed by Christiana Figueres, the ex-head of the UN climate change convention from 2010 to 2016. It is the dual approach of acknowledging the severity of the issue and the cost of the delays to action, but looking at the present state of affairs as an opportunity to avoid bigger damage and focus on the near-term solutions.

    5. Create a new normal

    Having a special climate change section within a media publication is a nice sign that the organisation cares about the problem. But how likely are people to click on it just to discover another ambush of negative stories? Including climate references in the majority of stories, from fashion to travel, helps normalise climate change as a backdrop to all aspects of our lives.

    There’s no need for preaching. Nobody wants to be patronised for their decision to take a flight to see the family that lives far away. But subtle travel listicles about local destinations, creative meat-free recipes or an imaginative reinvention of fashion advice as restyling, not buying, can offer up alternatives in creative ways.

    It should not be a taboo topic at dinner parties or social events. Avoid “othering” the climate change issue and help people stay aware and committed to tackling the elements of it.

    Being aware of climate change as a new norm is healthier than trying to push it away and deny it’s happening. Engagement with the biggest story of our time is the best catalyst for change that we have.


    Don’t have time to read about climate change as much as you’d like?

    Get a weekly roundup in your inbox instead. Every Wednesday, The Conversation’s environment editor writes Imagine, a short email that goes a little deeper into just one climate issue. Join the 40,000+ readers who’ve subscribed so far.


    Anastasia Denisova does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

    ref. Five ways to have more constructive climate conversations – https://theconversation.com/five-ways-to-have-more-constructive-climate-conversations-249417

    MIL OSI – Global Reports

  • MIL-OSI USA: Budd, Tillis, Warner, Kaine Urge Swift Distribution of Funding for Public Lands for Helene Recovery

    US Senate News:

    Source: United States Senator Ted Budd (R-North Carolina)

    Washington, D.C. — Today, Senators Ted Budd (R-NC), Mark Warner (D-VA), Thom Tillis (R-NC), and Tim Kaine (D-VA) sent a letter to Secretary of Agriculture Brooke Rollins and Secretary of the Interior Doug Burgum, urging these departments to quickly allocate funding appropriated by Congress for public lands that were ravaged by Hurricane Helene. 

    Read the text of the letter:

    We write today regarding our states’ recovery from Hurricane Helene and the supplemental funding made available to the U.S. Department of Agriculture (USDA) and Department of the Interior (DOI) by the American Relief Act of 2025 (H.R.10545). We urge you to expeditiously allocate this funding to our public lands in North Carolina and Virginia that were ravaged by this deadly storm.

    Hurricane Helene devastated communities across North Carolina, Virginia, and large swaths of the Southeast. Historic flooding and high winds resulted in over a hundred deaths, damaged and destroyed thousands of homes and businesses, and decimated critical regional infrastructure in our states. Additionally, the storm caused unprecedented damage to public lands in western North Carolina and Southwest Virginia that are essential drivers of economic activity for many communities.

    Public lands managed by USDA and DOI are crucial economic engines for communities throughout western North Carolina and Southwest Virginia. For example, the National Park Service’s (NPS) most visited unit, the Blue Ridge Parkway, which spans 469 miles across the Blue Ridge Mountains in North Carolina and Virginia, supports the economies of dozens of communities in our states. In 2023, 16.7 million visitors spent nearly $1.4 billion in communities surrounding the Parkway, which supported over 19,000 jobs. Helene decimated the Blue Ridge Parkway resulting in indefinite closures along large portions of the roadway and damage to many trails, historical sites, and recreational areas. The recovery effort for the Parkway will be one of the most significant and expensive infrastructure projects in the park’s history, and its success will be essential for the dozens of gateway communities that rely on the Parkway.

    In addition to National Park Service managed property, many of our communities in Southwest Virginia and western North Carolina contain U.S. Forest Service lands that were decimated by Hurricane Helene. This includes the George Washington and Jefferson National Forests in Virginia, the Cherokee National Forest in Tennessee and North Carolina, and the Nantahala and Pisgah National Forests in western North Carolina. These lands attract millions of visitors each year who contribute millions more in visitor spending that sustains countless small businesses and gateway communities.

    Perhaps no Forest Service asset in the country suffered more damage from Hurricane Helene than the Virginia Creeper Trail, a 34-mile recreational trail that is co-managed by the Forest Service and the towns of Damascus and Abingdon in Southwest Virginia. The storm obliterated 18 miles of the Creeper Trail from Damascus to Whitetop, Virginia, destroying 18 trestles and washing away extended segments of the trail itself. The Creeper Trail is the most significant driver of economic activity in Damascus and one of the most significant tourism destinations in the entire region. The trail attracts more than 200,000 visitors annually, supporting local bike shops, restaurants, and lodging. In all, the Creeper Trail contributes nearly $13 million annually in tourism spending to the region’s economy. A prolonged closure of the trail could have devastating consequences for Damascus and the entire region. It is critical that USDA and the Forest Service move quickly to allocate appropriated funding to rebuild the Creeper Trail to ensure Damascus and other localities that depend on the trail can fully recover from Helene.

    We were pleased the American Relief Act of 2025 (H.R.10545) included robust funding to address natural disaster-related damage to public lands across the U.S., including $6.4 billion for the U.S. Forest Service and $2.3 billion for the National Park Service. This funding is intended to support the rebuilding of iconic public attractions in our states, including the Blue Ridge Parkway, Appalachian Trail, and Virginia Creeper Trail. It will also support a broad range of other reconstruction and rehabilitation efforts on our public lands to ensure they can continue to safely provide recreational opportunities to our constituents and millions of additional visitors who help sustain these Appalachian communities. As our states continue to rebuild from Hurricane Helene, it is critical that this supplemental funding is deployed to our public lands swiftly to ensure a timely rebuild of these assets that our communities depend on.

    Thank you for your attention to this matter. We look forward to working with you to support the recovery efforts in our states. Please do not hesitate to reach out if we can provide additional information or assistance.

    MIL OSI USA News

  • MIL-OSI USA: N.C. Arts Council Awards $915,000 to Western N.C. Arts Organizations for Helene Recovery

    Source: US State of North Carolina

    Headline: N.C. Arts Council Awards $915,000 to Western N.C. Arts Organizations for Helene Recovery

    N.C. Arts Council Awards $915,000 to Western N.C. Arts Organizations for Helene Recovery
    jejohnson6

    The North Carolina Arts Council has awarded $915,000 to nonprofit arts organizations in Western North Carolina affected by Hurricane Helene. The grants utilize funds from the North Carolina Arts Foundation’s North Carolina Arts Relief Fund, the National Endowment for the Arts, and South Art’s Southern Arts Relief and Recovery Fund.

    The relief funds will be provided to 69 arts organizations throughout the impacted 26-county region. A list of awardees is available on the NCAC’s website (https://www.ncarts.org/hurricane-helene-relief-grant-award-recipients-2025/open).

    “This much-needed grant funding for Western North Carolina arts organizations signals another important step in the North Carolina Department of Natural and Cultural Resources’ commitment to recovery in areas affected by Hurricane Helene,” said Arts Council Director Jeff Bell. “The cultural and arts offerings in Western North Carolina are vital to the heritage and economic strength of our entire state.”

    The grants support artistic and administrative functions of Western N.C. arts organizations. Recipients may use them to fund salaries, artists’ fees, production, travel, promotion, programming expenses, supplies and equipment, office expenses, and facility operations.

    About the North Carolina Department of Natural and Cultural Resources
    The N.C. Department of Natural and Cultural Resources (DNCR) manages, promotes, and enhances the things that people love about North Carolina – its diverse arts and culture, rich history, and spectacular natural areas. Through its programs, the department enhances education, stimulates economic development, improves public health, expands accessibility, and strengthens community resiliency.
    The department manages over 100 locations across the state, including 27 historic sites, seven history museums, two art museums, five science museums, four aquariums, 35 state parks, four recreation areas, dozens of state trails and natural areas, the North Carolina Zoo, the State Library, the State Archives, the N.C. Arts Council, the African American Heritage Commission, the American Indian Heritage Commission, the State Historic Preservation Office, the Office of State Archaeology, the Highway Historical Markers program, the N.C. Land and Water Fund, and the Natural Heritage Program. For more information, please visit www.dncr.nc.gov.
    Feb 20, 2025

    MIL OSI USA News

  • MIL-OSI USA: America Is Back — and President Trump Is Just Getting Started

    US Senate News:

    Source: The White House
    President Donald J. Trump took office just one month ago, but has already accomplished more than most presidents do in their entire term as he makes good on his promise to usher in the New Golden Age of America.
    Here is a non-comprehensive list of President Trump’s wins after just one month:
    SECURING OUR HOMELAND:
    President Trump declared a national emergency at the border and deployed the military, including the 10th Mountain Division, to secure our nation.
    Illegal border crossings have hit lows not seen in decades as U.S. Border Patrol is re-empowered to once again enforce the law.
    ABC News: “From Jan. 21 through Jan. 31, the number of U.S. Border Patrol apprehensions along the southwest border dropped 85% from the same period in 2024, according to data obtained by ABC News. In the 11 days after Jan. 20, migrants apprehended at ports of entry declined by 93%.”

    Illegal aliens have started turning around in droves amid the crackdown.
    The Department of Homeland Security announced that arrests of criminal illegal immigrants have doubled under President Trump.
    President Trump signed the Laken Riley Act into law, which requires illegal immigrants arrested or charged with theft or violence to be detained — honoring the legacy of Laken Riley, a Georgia college student brutally murdered by an illegal alien released into the country.
    President Trump ended “catch-and-release,” reversing the dangerous Biden-era policy that released dangerous illegal aliens back into our communities.
    President Trump shut down the “CBP One” app, which “paroled” more than one million illegal immigrants into the country.
    A migrant shelter in San Diego announced it will shut down after it has received no new arrivals since President Trump took office.

    President Trump terminated all taxpayer-funded public benefits for illegal aliens.
    President Trump ramped up deportation flights of criminal illegal aliens.
    After President Trump announced “urgent and decisive retaliatory measures” against Colombia over its refusal to accept deportation flights from the U.S., the country’s president quickly backtracked — even offering the use of his personal plane for the deportations.
    El Salvadorian President Nayib Bukele offered to accept deportees of any nationality, including violent American criminals currently imprisoned in the U.S.

    President Trump began transferring criminal illegal aliens to Guantanamo Bay ahead of their repatriation back to their own countries.
    President Trump re-established the successful “Remain in Mexico” policy.
    President Trump restarted construction of the border wall.
    The Trump Administration officially declared Tren de Aragua, MS-13, the Sinaloa Cartel, the Jalisco New Generation Cartel, the United Cartels, the Gulf Cartel, the Northeast Cartel, and the Michoacán Family as Foreign Terrorist Organizations.
    New York City Mayor Eric Adams (D) agreed to allow federal immigration officials to operate on Rikers Island and deport illegal alien criminals following his meeting with Border Czar Tom Homan.
    Mexico announced a deployment of 10,000 troops to the border to combat illegal immigration and fentanyl trafficking, while Canada announced a flurry of measures to combat fentanyl manufacturing and trafficking following President Trump’s imposition of tariffs on the two countries.
    President Trump implemented an additional 10% tariff on imports from China in order to stem the flow of illegal aliens and fentanyl.
    President Trump ordered an end to birthright citizenship.
    President Trump suspended the U.S. Refugee Admissions Program.
    The Department of Justice filed suit against the State of New York and some of its elected officials over their willful failure to follow federal immigration law and announced that it will take action against so-called “sanctuary cities” for their obstruction of U.S. law.
    The Department of Homeland Security “clawed back” tens of millions of dollars in funds paid by rogue FEMA officials to house illegal aliens in luxury New York City hotels.
    President Trump reinstated the death penalty for federal capital crimes.
    PROTECTING AMERICAN WORKERS AND FOSTERING ECONOMIC GROWTH:
    President Trump restored a 25% tariff on steel imports and elevated the tariff to 25% on aluminum imports to protect these critical American industries from unfair foreign competition — a move praised by the Steel Manufacturers Association, the Aluminum Association, and businesses across the country.
    Robert Simon, CEO of JSW Steel USA, praised President Trump’s steel and aluminum tariffs, celebrating them “as a project that will flood the U.S. with jobs as trading partners move their industries to U.S. soil to avoid tariffs.”

    Makoto Uchida, the CEO of global automaker Nissan, said President Trump’s tariffs could push the car manufacturer to move its production from Mexico to the U.S.
    President Trump unveiled a plan for fair and reciprocal trade, making clear to the world that the United States will no longer tolerate being ripped off.
    President Trump secured hundreds of billions of dollars in new investments.
    President Trump announced the largest artificial intelligence infrastructure project in history, securing $500 billion in planned private sector investment — with major CEOs agreeing it would not have been possible without President Trump’s leadership.
    Saudi Arabia declared its intention to invest $600 billion in the United States over the next four years.
    President Trump secured a $20 billion investment by DAMAC Properties to build new U.S.-based data centers.
    Taiwan pledged to boost its investment in the United States.
    Electronics giants Samsung and LG “are considering moving their plants in Mexico to the U.S.” now that President Trump is back in office.

    In February, forecasters from the Federal Reserve Bank of Philadelphia revised their economic growth projections for the first quarter of 2025 up from 1.9% to 2.5%, and their unemployment rate projections for the quarter down from 4.2% to 4.1%.
    After a meeting with President Trump, Stellantis announced it will reopen its assembly plant in Belvidere, Illinois — putting 1,500 employees back to work — and build its next-generation Dodge Durango in Detroit, Michigan. The company also announced new investments in their Toledo, Ohio, and Kokomo, Indiana, facilities.
    President Trump laid out a visionary plan to establish a Sovereign Wealth Fund to maximize the stewardship of the $5+ trillion in assets held by the United States.
    Following President Trump’s victory, the S&P 500 set a new record as the stock market surged to record highs — while major Wall Street firms like JP Morgan Chase posted their highest ever annual profits.
    LOWERING THE COST OF LIVING:
    President Trump directed the heads of all executive departments and agencies to “deliver emergency price relief … to the American people and increase the prosperity of the American worker.”
    President Trump established the National Energy Dominance Council to maximize use of the U.S.’ extensive energy resources, thereby enabling lower energy prices.
    Crude oil prices have fallen over 5% since President Trump took office.
    The Department of Energy postponed burdensome Biden-era efficiency standard rules for the following appliances, saving American consumers large sums:
    Central air conditioners: Biden rules were slated to make air conditioners $1,100 more expensive, according to Alliance for Consumers.
    Gas water heaters: Biden rules were slated to make water heaters $2,800 more expensive.
    Clothes washers and dryers: Biden rules were slated to make washers $200 more expensive.
    Light bulbs: Biden rules were slated to make light bulbs $140 more expensive.
    Walk-in coolers and freezers, commercial refrigeration equipment, and air compressors.

    The total cost of federal regulations in 2023 was a record-breaking $2.1 trillion, or $15,788 per U.S. household, according to the Competitive Enterprise Institute. By requiring agencies to identify at least ten existing rules, regulations, or guidance documents to be repealed for every one rule they promulgate, President Trump has put the U.S. on track to severely reduce regulatory costs for everyday Americans.
    The National Associations of Manufacturers found the cost of federal regulations was even greater — at $3.079 trillion in 2022.

    Secretary Sean Duffy’s very first action at the Department of Transportation was to initiate rulemaking resetting Corporate Average Fuel Economy (CAFE) standards — effectively eliminating the Biden-era electric vehicle mandate.
    NBER economist Mark R. Jacobsen “estimates that a one-mpg increase in CAFE standards costs consumers of all income levels approximately 0.5% of their income in the first year of the increase. By the 10th year following the increase, however, this cost becomes regressive, as the increase drives up the price of used cars. A one-mpg increase in CAFE standards costs consumers earning less than $25,000 per year 1.12% of their income, but only costs consumers earning more than $75,000 per year 0.41% of their income.”

    RE-ESTABLISHING AMERICAN STRENGTH:
    President Trump secured the release of six American hostages in Venezuela, two Americans in Afghanistan, an American-Israeli citizen in Hamas captivity, a Pennsylvania teacher in Russian captivity, and an American citizen in Belarus — bringing the total number of American hostages released under President Trump to 11.
    President Trump spoke with Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskyy in pursuit of finally securing peace as negotiations get underway.
    President Trump restored maximum pressure on Iran, “sanctioning an international network for facilitating the shipment of millions of barrels of Iranian crude oil worth hundreds of millions of dollars to the People’s Republic of China.”
    President Trump redesignated the Iran-backed Houthis as a Foreign Terrorist Organization.
    President Trump hosted Israeli Prime Minister Benjamin Netanyahu for a visit where he proposed a bold vision for securing lasting peace in Gaza.
    Former U.S. Ambassador to Israel David Friedman described the proposal as “brilliant, historic and the only idea I have heard in 50 years that has a chance of bringing security, peace and prosperity to this troubled region.”

    President Trump hosted Japanese Prime Minister Shigeru Ishiba, who announced his intention to “elevate Japan’s investment in the United States to an unprecedented amount of $1 trillion,” import “historic” quantities of LNG from Alaska, and open new auto plants in the U.S.
    President Trump hosted Jordan’s King Abdullah II, who announced that the Kingdom will accept 2,000 sick children from Gaza “as quickly as possible.”
    President Trump hosted Indian Prime Minister Narendra Modi for a visit where they announced new deals between the two countries on immigration, trade, energy, and artificial intelligence.
    President Trump banned funding to UNRWA — a United Nations agency that employed hundreds of Hamas and jihad operatives.
    President Trump imposed sanctions on the International Criminal Court, which has illegitimately asserted jurisdiction over internal U.S. matters and baselessly targeted Israeli Prime Minister Benjamin Netanyahu.
    President Trump reinstated the Mexico City Policy to ensure no taxpayer dollars support foreign organizations that perform, or actively promote, abortion in other nations.
    The Department of State ordered embassies worldwide to only fly the American flag — not activist flags.
    President Trump declared all foreign policy must be conducted under the President’s direction, ensuring career diplomats reflect the foreign policy of the United States at all times.
    The Department of State declared that U.S. foreign policy will be America First going forward.
    Following a visit from Secretary of State Marco Rubio, Panamanian President José Raúl Mulino agreed to withdraw from China’s Belt and Road Initiative, a debt-trap diplomacy scheme the Chinese Communist Party uses to gain influence over developing nations.
    The U.S. rejoined the Geneva Consensus Declaration, which promotes and strengthens opportunities for women and girls around the world, and protects the family as the fundamental unit of society.
    President Trump cracked down on anti-Semitism by canceling visas for foreign students who are Hamas sympathizers.
    President Trump ordered the immediate dismissal of the Board of Visitors for the Army, Air Force, Navy, and Coast Guard following years of woke ideologies infiltrating U.S. service academies.
    The U.S. Army barred transgender people from enlisting and stopped using taxpayer funds for sex change surgeries.
    President Trump reinstated, with backpay, U.S. service members who were discharged under the military’s nonsensical COVID-19 vaccine mandate.
    Secretary of Defense Pete Hegseth restored Fort Liberty, North Carolina, to “Fort Bragg,” in honor of a World War II hero.
    President Trump withdrew the U.S. from the World Health Organization.
    President Trump paused enforcement of the overregulation of American businesses abroad, which negatively impacted national security.
    President Trump proclaimed “Gulf of America Day” after the Department of the Interior officially established it on its mapping databases.
    President Trump initiated a process to build a next-generation missile defense shield over the United States.
    UNLEASHING AMERICAN ENERGY:
    President Trump declared a National Energy Emergency to unlock America’s full energy potential and bring down costs for American families.
    President Trump rescinded every one of the Biden Administration’s job-killing, pro-China, anti-American energy regulations.
    President Trump empowered Americans with choice in vehicles, showerheads, toilets, washing machines, light bulbs, and dishwashers, and killed Biden-era regulations that restricted water flow and mandated inadequate light bulb standards.
    President Trump terminated the job-killing Green New Scam.
    President Trump withdrew from the disastrous Paris Climate Agreement, which unfairly ripped off our country.
    President Trump paused federal permitting for massive wind farms, which degrade our natural landscapes and fail to serve American consumers.
    President Trump reversed bureaucratic regulations that impeded Alaska’s ability to develop its vast natural resources.
    President Trump re-opened 625 million acres for offshore drilling, which Biden banned in his waning days, in order to “drill, baby, drill.”
    President Trump scrapped an Obama-era rule on greenhouse gases.
    President Trump ended the Liquefied Natural Gas pause and approved the first LNG project since the Biden Administration banned them last year.
    BRINGING BACK COMMON SENSE:
    Health systems across the nation stopped or downsized their sex change programs for minors following President Trump’s “Protecting Children from Chemical and Surgical Mutilation” executive order.
    In Illinois, Chicago’s Lurie Children’s Hospital paused sex-change surgeries for patients under 19 as it “work[s] to understand the rapidly evolving environment.”
    In Colorado, Denver Health announced it would stop performing sex change surgeries on minor children, while UCHealth said it was ending so-called “gender-affirming care” for all minors.
    In Washington, D.C., Children’s National Hospital “paused” prescribing puberty blockers and hormone therapies for minors, while Northwest Washington Hospital did the same.
    In Virginia, VCU Health and Children’s Hospital of Richmond “suspended” providing transgender-related medication and surgeries for minors, while UVA Health also “suspended” transgender-related services for minors.

    President Trump ended the unfair, demeaning practice of forcing women to compete against men in sports — which resulted in the NCAA changing its rules.
    The Department of Education launched investigations into the California Interscholastic Federation and the Minnesota State High School League over their failures to comply.

    President Trump made it the official policy of the U.S. government that there are only two sexes.
    President Trump banned COVID-19 vaccine mandates at schools that receive federal funding.
    President Trump rolled back the Biden-era push to mandate paper straws.
    President Trump instructed the Secretary of the Treasury to stop production of the penny, which cost 3.69 cents each to make.
    President Trump directed full enforcement of the Hyde Amendment, which bars taxpayer dollars from being used to fund or promote elective abortion.
    The Department of Transportation terminated the approval for New York City’s burdensome “congestion pricing” scheme.
    RESTORING ACCOUNTABILITY AND TRANSPARENCY IN GOVERNMENT
    President Trump established the Department of Government Efficiency (DOGE) to maximize government productivity and ensure the best use of taxpayer funds — which has already achieved billions of dollars in savings for taxpayers.
    President Trump commenced his plan to downsize the federal bureaucracy and eliminate waste, bloat, and insularity.
    President Trump ordered federal workers to return to the office five days a week.
    President Trump ordered federal agencies hire no more than one employee for every four employees who leave.
    President Trump ended the wasteful Federal Executive Institute, which had become a training ground for bureaucrats.
    President Trump ordered the termination of all federal Fake News media contracts.

    President Trump ordered the Consumer Financial Protection Bureau — the brainchild of Elizabeth Warren, which funneled cash to left-wing advocacy groups — to halt operations.
    President Trump ordered an end to anti-Christian bias in the Federal Government.
    President Trump ordered an examination of all regulations to assess any infringements on Americans’ Second Amendment rights.
    The Environmental Protection Agency canceled tens of millions of dollars in contracts to left-wing advocacy groups, announced an investigation into a scheme by Biden EPA staffers to shield billions of dollars from oversight and accountability, and put 168 “environmental justice” employees on leave.
    President Trump stopped the waste, fraud, and abuse within USAID — ensuring taxpayers are no longer on the hook for funding the pet projects of entrenched bureaucrats, such as sex changes in Guatemala.
    President Trump ordered an end to the weaponization of the Federal Government against American citizens.
    The Department of Justice immediately began rooting out politically motivated lawfare that occurred in the Biden Administration.

    President Trump reversed the massive over-expansion of the IRS that took place during the Biden Administration.
    President Trump eliminated discriminatory DEI offices, employees, and practices across the bureaucracy alongside a return to merit-based hiring — including at the Federal Aviation Administration, where the Biden Administration specifically recruited individuals with intellectual disabilities and psychiatric issues.
    As a result, taxpayer-funded PBS closed its DEI office, Disney dropped two of its DEI programs, Goldman Sachs ended its DEI policy, and Institutional Shareholder Services announced it would no longer consider diversity of company boards when making its voting recommendations.
    The Federal Communications Commission opened an investigation into discriminatory DEI policies at Comcast, an entity it regulates.

    President Trump ordered an end to all censorship of Americans by the federal government.
    President Trump ordered a review of funding for all non-governmental organizations, so taxpayers are no longer funding those that undermine America’s interests.
    The Department of State issued a “pause” on existing foreign aid grants to ensure accountability and efficiency.

    President Trump lifted last-minute collective bargaining agreements issued by the Biden Administration, which sought to impede reform.
    President Trump overrode bureaucratic red tape that limited water availability in California following the failure of the state’s water system during the devastating wildfires.
    President Trump terminated the Biden-era electric vehicle mandate.
    President Trump suspended the Biden-era EV charging program, which had resulted in just eight charging stations despite $7.5 billion earmarked for the program.

    President Trump shut down the wasteful Biden-era “Climate Corps” program.
    The Federal Communications Commission took action against a Soros-backed radio station that leaked sensitive information about ICE operations.
    President Trump ordered the declassification of documents related to the assassinations of President John F. Kennedy, Jr., Robert F. Kennedy, and Rev. Dr. Martin Luther King, Jr.
    President Trump opened the White House Press Briefing Room to non-legacy media outlets as the White House sets a new standard for transparency in the digital age.
    President Trump reinstated press privileges for roughly 440 journalists who the Biden Administration sought to silence.
    President Trump fired members of The Kennedy Center’s Board of Trustees amid their obsession with perpetuating radical, left-wing ideology at taxpayer expense.
    President Trump revoked the security clearances of the 51 “spies who lied.”
    EMPOWERING THE AMERICAN PEOPLE
    President Trump established the Make America Healthy Again Commission, which redirects the national focus to promoting health rather than simply managing disease.
    President Trump took executive action to expand access to in vitro fertilization (IVF).
    President Trump established the White House Faith Office to protect Americans’ religious liberty.
    President Trump ordered an end to the radical indoctrination of children in K-12 schools that receive federal funding.
    President Trump took executive action to support parents in choosing the best education for their children.
    President Trump established the Presidential Working Group on Digital Asset Markets to strengthen U.S. leadership in digital finance.
    President Trump granted full and unconditional pardons to 23 pro-life Americans who were unjustly persecuted by the Biden Administration.
    President Trump pardoned two Washington, D.C., police officers who were imprisoned simply for doing their jobs of apprehending criminals.
    President Trump has had his cabinet confirmed by the Senate at a far faster pace than his predecessors, with a majority of his cabinet earning confirmation in his first month.

    MIL OSI USA News

  • MIL-OSI United Kingdom: Nick Park CBE, unveils statue of Feathers McGraw at Animate, Preston

    Source: City of Preston

    Nick Park CBE, four-time Academy Award®-winner and Preston-born creator of Wallace & Gromit, has officially opened the city’s £45m+ Animate entertainment and leisure destination.

    The Honorary Freeman of Preston and multi award-winning filmmaker, unveiled a four-foot-high bronze statue of Feathers McGraw, the villainous penguin character in the Wallace & Gromit animated films, to mark the opening, close by to the existing famous Wallace & Gromit bench at Preston Markets.

    Joining Nick at the unveiling were the Mayor of Preston Councillor Philip Crowe, Chris Butler and Chris Jones, owners and directors of Castle Fine Arts Foundry, which created the statue, and Merlin Crossingham, Bafta@ award-winning creative co-director of Wallace and Gromit at Aardman Animations.

    Nick and Merlin are executive directors and creative directors, respectively, at Bristol-based independent studio Aardman, makers of the Wallace & Gromit films and other beloved brands, including Shaun the Sheep, Creature Comforts, Chicken Run, and Morph.

    Nick Park CBE said:

    “As a proud Prestonian, I couldn’t be more ‘egg-cited’ to see our infamous Feathers McGraw joining Wallace and Gromit in my hometown.

    “I’m not sure how happy Wallace and Gromit will be, though, to have their arch nemesis clutching the limelight.”

    Councillor Matthew Brown, Leader at Preston City Council said:

    “To have Nick Park officially opening our flagship regeneration scheme, Animate, is a genuine honour and landmark moment for the Council and the city. In addition, the new Feathers McGraw statue is a fantastic complement to the Wallace and Gromit bench, which has drawn so many visitors to Preston – its popularity has blown us away.

    “Today heralds a new era for Preston, providing an unrivalled multi-tenanted entertainment and leisure complex for residents and visitors from the wider regionin the ownership of our city.”

    Chris Jones, Director at Castle Fine Arts Foundry added:

    “It was such an honour for us all at the Foundry to be given the opportunity to depict the deliciously malign Feathers McGraw in bronze, having enjoyed creating Wallace & Gromit a couple of years ago.

    “We had felt Feathers ‘wee beady eyes’ upon us in the workshop for a good few months since we completed him, so it was both a relief and a joy to put him where he truly belongs, alongside his arch nemeses in Preston.”

    Animate features The Arc Cinema with eight screens, 16-lane Hollywood Bowl bowling alley with gaming zone, public realm, a socialising unit and 164-space basement car park, alongside leading family restaurant brands Ask Italian, Cosmo, Taco Bell, Argento Lounge and a variety of street food outlets and a cocktail bar in Mad Giant Food Hall, run by Northern Lights Group.

    The scheme was delivered by Maple Grove Developments (MGD), part of Preston-based contractor Eric Wright Group, on behalf of Preston City Council. Commercial property agents Sanderson Weatherall are the estate managers.

    Built on the former indoor market and car park site, Animate is fully owned by Preston City Council and is one of six major projects in Preston’s Harris Quarter Towns Fund Investment Programme, a £200m programme including £20.9m of funding by UK Government to support several regeneration projects.

    The leisure scheme supports the Council’s commitment to Community Wealth Building – a fair, inclusive and ethical approach to fostering sustainable economic development and prosperity for all in Preston – via measures including using locally based businesses and the creation of approximately 300 full and part-time jobs when fully open and 105 apprenticeship weeks worked throughout the construction period to date.

    Opening dates at Animate

    • Argento Lounge – Open
    • Taco Bell – Open
    • The Arc Cinema – Open
    • Hollywood Bowl – opening March
    • Ask Italian – opening early April 
    • Mad Giant Food Hall – coming soon  
    • Cosmo – coming soon

    Visit Animate Preston for more information

    Harris Quarter Towns Fund Investment Programme

    Projects included in Preston’s £200 million Harris Quarter Towns Fund Investment Programme are:

    • Animate – £45m multi-use entertainment and leisure complex anchored by a state-of-the-art cinema and bowling venue next to Preston Markets
    • Educate Preston: The creation of a new Careers and Employment, Information, Advice and Guidance Hub in the Harris Quarter.
    • Renewal of Harris Quarter Assets: Investment to support the redevelopment of publicly-owned buildings in the Harris Quarter to support new cultural and community uses, including Amounderness House.
    • Illuminate and Integrate: A project to deliver improved pedestrian and cycleway infrastructure, street lighting and other public realm improvements within the Harris Quarter.
    • Preston Youth Zone:The development of Preston Youth Zone as a state-of-the-art facility for young people in Preston aged eight to 19.
    • #HarrisYourPlace:The refurbishment of the Grade I listed Harris Museum, Art Gallery & Library, enhancing and protecting the building for future generations.
    • Preston Pop Ups: £1m pop-up programme of events bringing together new temporary event space, artworks and improvements to public realm infrastructure, aimed at boosting visitor activity in the Harris Quarter.

    For more information, visit Invest Preston.

    MIL OSI United Kingdom

  • MIL-OSI: Orion180 Makes Key Executive Moves to Drive Product Growth and Further Expansion

    Source: GlobeNewswire (MIL-OSI)

    MELBOURNE, Fla., Feb. 20, 2025 (GLOBE NEWSWIRE) — Orion180, a leading provider of innovative insurance solutions, today announced it has hired former The Hartford executive Chris DiMartino as Chief Underwriting Officer. In this role, DiMartino will be responsible for overseeing all aspects of underwriting, product development and management across its surplus and personal lines of business.

    DiMartino brings 27 years of experience in underwriting, actuarial science, and product management in commercial and personal lines P&C insurance. Prior to joining Orion180, he served as senior vice president of insurance services at AAA Northeast and held prominent leadership roles in his 20+ years at The Hartford, most recently serving as Head of Product for its $3 billion personal lines business. DiMartino is a Fellow of the Casualty Actuarial Society (FCAS), a Chartered Property Casualty Underwriter (CPCU), and a licensed attorney.

    “Bringing Chris on board marks a pivotal step in our company’s evolution,” said Ken Gregg, CEO and Founder of Orion180. “His deep expertise in underwriting and product management will be critical in enhancing our portfolio as we continue to aggressively grow product lines and expand to other States.”

    Additionally, Orion180 Chief Operations Officer (COO) Ryan Jesenik has been promoted to President, Insurance. In his expanded role, Jesenik will retain his responsibilities as COO while also leading growth strategy, ensuring daily operations align seamlessly with the company’s long-term goals.

    During Jesenik’s tenure as COO, Orion180 has been named to the Inc. 5000 fastest-growing private companies list for two consecutive years, and he helped grow the company to $263M in in-force premium. He also supported the company’s homeowners, FLEX, and private residential flood insurance product launches, and the release of the innovative MY180 app allowing agents to seamlessly create new quotes and manage their book of business.

    “Ryan has been instrumental in helping Orion180 become one of the fastest growing home insurance companies in the U.S.,” said Gregg. “I look forward to our continued work together, advancing our vision of offering consumers and agents greater choice and unmatched flexibility to meet their everchanging needs.”

    About Orion180
    Orion180 is a customer-focused, technology-driven insurance brand that combines proprietary technology, real-time data, and straightforward underwriting practices to provide a seamless and premier insurance experience. Orion180 operates through Orion180 Insurance Co., a surplus lines insurance company serving Alabama, Georgia, Mississippi, North Carolina, South Carolina, Texas, Colorado (Flood only), Tennessee (Flood only), Illinois (Flood only) and Arizona, and Orion180 Select Insurance Co., an admitted insurance company offering coverage in Alabama, Arizona, Georgia, Indiana, Mississippi, North Carolina, and Ohio. With its proprietary MY180 platform and third-party integrations, Orion180 offers unmatched efficiency and innovation, fulfilling its vision of becoming the global leader in insurance solutions while maintaining its mission to deliver superior customer experiences and a comprehensive suite of products. Connect with Orion180 on X, LinkedIn, Facebook, Instagram, and YouTube. For more information, visit www.Orion180.com.

    Media Contact
    Ross Blume
    Fusion Public Relations
    Orion180@fusionpr.com

    The MIL Network

  • MIL-OSI Global: A fiscal crisis is looming for many US cities

    Source: The Conversation – USA – By John Rennie Short, Professor Emeritus of Public Policy, University of Maryland, Baltimore County

    Houston residents at a flooded park after the passage of Hurricane Beryl, July 8, 2024. Mark Felix/AFP via Getty Images

    Five years after the start of the COVID-19 pandemic, many U.S. cities are still adjusting to a new normal, with more people working remotely and less economic activity in city centers. Other factors, such as underfunded pension plans for municipal employees, are pushing many city budgets into the red.

    Urban fiscal struggles are not new, but historically they have mainly affected U.S. cities that are small, poor or saddled with incompetent managers. Today, however, even large cities, including Chicago, Houston and San Francisco, are under serious financial stress.

    This is a looming nationwide threat, driven by factors that include climate change, declining downtown activity, loss of federal funds and large pension and retirement commitments.

    Spending cuts abound in many U.S. cities as inflation lingers and pandemic-era stimulus dries up.

    Why cities struggle

    Many U.S. cities have faced fiscal crises over the past century, for diverse reasons. Most commonly, stress occurs after an economic downturn or sharp fall in tax revenues.

    Florida municipalities began to default in 1926 after the collapse of a land boom. Municipal defaults were common across the nation in the 1930s during the Great Depression: As unemployment rose, relief burdens swelled and tax collections dwindled.

    In 1934 Congress amended the U.S. bankruptcy code to allow municipalities to file formally for bankruptcy. Subsequently, 27 states enacted laws that authorized cities to become debtors and seek bankruptcy protection.

    Declaring bankruptcy was not a cure-all. It allowed cities to refinance debt or stretch out payment schedules, but it also could lead to higher taxes and fees for residents, and lower pay and benefits for city employees. And it could stigmatize a city for many years afterward.

    In the 1960s and 1970s, many urban residents and businesses left cities for adjoining suburbs. Many cities, including New York, Cleveland and Philadelphia, found it difficult to repay debts as their tax bases shrank.

    The New York Daily News, Oct. 30, 1975, after U.S. President Gerald Ford ruled out providing federal aid to save the city from bankruptcy. Several months later, Ford signed legislation authorizing federal loans.
    Edward Stojakovic/Flickr, CC BY

    In the wake of the 2008-2009 housing market collapse, cities including Detroit, San Bernardino, California, and Stockton, California, filed for bankruptcy. Other cities faced similar difficulties but were located in states that did not allow municipalities to declare bankruptcy.

    Even large, affluent jurisdictions could go off the financial rails. For example, Orange County, California, went bankrupt in 2002 after its treasurer, Robert Citron, pursued a risky investment strategy of complex leveraging deals, losing some $1.65 billion in taxpayer funds.

    Today, cities face a convergence of rising costs and decreasing revenues in many places. As I see it, the urban fiscal crisis is now a pervasive national challenge.

    Climate-driven disasters

    Climate change and its attendant increase in major disasters are putting financial pressure on municipalities across the country.

    Events like wildfires and flooding have twofold effects on city finances. First, money has to be spent on rebuilding damaged infrastructure, such as roads, water lines and public buildings. Second, after the disaster, cities may either act on their own or be required under state or federal law to make expensive investments in preparation for the next storm or wildfire.

    Los Angeles Mayor Karen Bass (center) discusses wildfire recovery in Pacific Palisades, Calif., Jan. 27, 2025. Cleaning up after the wildfires, which destroyed more than 16,000 structures, will include disposing of several million tons of toxic ash and debris.
    Drew A. Kelley/MediaNews Group/Long Beach Press-Telegram via Getty Images

    In Houston, for example, court rulings after multiple years of severe flooding are forcing the city to spend $100 million on street repairs and drainage by mid-2025. This requirement will expand the deficit in Houston’s annual budget to $330 million.

    In Massachusetts, towns on Cape Cod are spending millions of dollars to switch from septic systems to public sewer lines and upgrade wastewater treatment plants. Population growth has sharply increased water pollution on the Cape, and climate change is promoting blooms of toxic algae that feed on nutrients in wastewater.

    Increasing uncertainty about the total costs of mitigating and adapting to climate change will inevitably lead rating agencies to downgrade municipal credit ratings. This raises cities’ costs to borrow money for climate-related projects like protecting shorelines and improving wastewater treatment.

    Underfunded pensions

    Cities also spend a lot of money on employees, and many large cities are struggling to fund pensions and health benefits for their workforces. As municipal retirees live longer and require more health care, the costs are mounting.

    For example, Chicago currently faces a budget deficit of nearly $1 billion, which stems partly from underfunded retirement benefits for nearly 30,000 public employees. The city has $35 billion in unfunded pension liabilities and almost $2 billion in unfunded retiree health benefits. Chicago’s teachers are owed $14 billion in unfunded benefits.

    Policy studies have shown for years that politicians tend to underfund retirement and pension benefits for public employees. This approach offloads the real cost of providing police, fire protection and education onto future taxpayers.

    Struggling downtowns and less federal support

    Cities aren’t just facing rising costs – they’re also losing revenues. In many U.S. cities, retail and commercial office economies are declining. Developers have overbuilt commercial properties, creating an excess supply. More unleased properties will mean lower tax revenues.

    At the same time, pandemic-related federal aid that cushioned municipal finances from 2020 through 2024 is dwindling.

    State and local governments received $150 billion through the 2020 Coronavirus Aid, Relief, and Economic Security (CARES) Act and an additional $130 billion through the 2021 American Rescue Plan Act. Now, however, this federal largesse – which some cities used to fill mounting fiscal cracks – is at an end.

    In my view, President Donald Trump’s administration is highly unlikely to bail out urban areas – especially more liberal cities like Detroit, Philadelphia and San Francisco. Trump has portrayed large cities governed by Democrats in the darkest terms – for example, calling Baltimore a “rodent-infested mess” and Washington, D.C., a “dirty, crime-ridden death trap.” I expect that Trump’s animus against big cities, which was a staple of his 2024 campaign, could become a hallmark of his second term.

    Detroit officials respond to disparaging remarks about the city by Donald Trump during a campaign speech in Detroit, Oct. 10, 2024.

    Resistance to new taxes

    Cities can generate revenue from taxes on sales, businesses, property and utilities. However, increasing municipal taxes – particularly property taxes – can be very difficult.

    In 1978, California adopted Proposition 13 – a ballot measure that limited property tax increases to the rate of inflation or 2% per year, whichever is lower. This high-profile campaign created a widespread narrative that property taxes were out of control and made it very hard for local officials to support property tax increases.

    Thanks to caps like Prop 13, a persistent public view that taxes are too high and political resistance, property taxes have tended to lag behind inflation in many parts of the country.

    The crunch

    Taking these factors together, I see a fiscal crunch coming for U.S. cities. Small cities with low budgets are particularly vulnerable. But so are larger, more affluent cities, such as San Francisco with its collapsing downtown office market, or Houston, New York and Miami, which face growing costs from climate change.

    Workers in North Miami Beach, Fla., distribute sandbags to residents to help prevent flooding as Hurricane Milton approaches the state on Oct. 8, 2024.
    AP Photo/Wilfredo Lee

    One city manager who runs an affluent municipality in the Pacific Northwest told me that in these difficult circumstances, politicians need to be more frank and open with their constituents and explain convincingly and compellingly how and why taxpayer money is being spent.

    Efforts to balance city budgets are opportunities to build consensus with the public about what municipalities can do, and at what cost. The coming months will show whether politicians and city residents are ready for these hard conversations.

    John Rennie Short does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

    ref. A fiscal crisis is looming for many US cities – https://theconversation.com/a-fiscal-crisis-is-looming-for-many-us-cities-249436

    MIL OSI – Global Reports

  • MIL-Evening Report: A fiscal crisis is looming for many US cities

    Source: The Conversation (Au and NZ) – By John Rennie Short, Professor Emeritus of Public Policy, University of Maryland, Baltimore County

    Houston residents at a flooded park after the passage of Hurricane Beryl, July 8, 2024. Mark Felix/AFP via Getty Images

    Five years after the start of the COVID-19 pandemic, many U.S. cities are still adjusting to a new normal, with more people working remotely and less economic activity in city centers. Other factors, such as underfunded pension plans for municipal employees, are pushing many city budgets into the red.

    Urban fiscal struggles are not new, but historically they have mainly affected U.S. cities that are small, poor or saddled with incompetent managers. Today, however, even large cities, including Chicago, Houston and San Francisco, are under serious financial stress.

    This is a looming nationwide threat, driven by factors that include climate change, declining downtown activity, loss of federal funds and large pension and retirement commitments.

    Spending cuts abound in many U.S. cities as inflation lingers and pandemic-era stimulus dries up.

    Why cities struggle

    Many U.S. cities have faced fiscal crises over the past century, for diverse reasons. Most commonly, stress occurs after an economic downturn or sharp fall in tax revenues.

    Florida municipalities began to default in 1926 after the collapse of a land boom. Municipal defaults were common across the nation in the 1930s during the Great Depression: As unemployment rose, relief burdens swelled and tax collections dwindled.

    In 1934 Congress amended the U.S. bankruptcy code to allow municipalities to file formally for bankruptcy. Subsequently, 27 states enacted laws that authorized cities to become debtors and seek bankruptcy protection.

    Declaring bankruptcy was not a cure-all. It allowed cities to refinance debt or stretch out payment schedules, but it also could lead to higher taxes and fees for residents, and lower pay and benefits for city employees. And it could stigmatize a city for many years afterward.

    In the 1960s and 1970s, many urban residents and businesses left cities for adjoining suburbs. Many cities, including New York, Cleveland and Philadelphia, found it difficult to repay debts as their tax bases shrank.

    The New York Daily News, Oct. 30, 1975, after U.S. President Gerald Ford ruled out providing federal aid to save the city from bankruptcy. Several months later, Ford signed legislation authorizing federal loans.
    Edward Stojakovic/Flickr, CC BY

    In the wake of the 2008-2009 housing market collapse, cities including Detroit, San Bernardino, California, and Stockton, California, filed for bankruptcy. Other cities faced similar difficulties but were located in states that did not allow municipalities to declare bankruptcy.

    Even large, affluent jurisdictions could go off the financial rails. For example, Orange County, California, went bankrupt in 2002 after its treasurer, Robert Citron, pursued a risky investment strategy of complex leveraging deals, losing some $1.65 billion in taxpayer funds.

    Today, cities face a convergence of rising costs and decreasing revenues in many places. As I see it, the urban fiscal crisis is now a pervasive national challenge.

    Climate-driven disasters

    Climate change and its attendant increase in major disasters are putting financial pressure on municipalities across the country.

    Events like wildfires and flooding have twofold effects on city finances. First, money has to be spent on rebuilding damaged infrastructure, such as roads, water lines and public buildings. Second, after the disaster, cities may either act on their own or be required under state or federal law to make expensive investments in preparation for the next storm or wildfire.

    Los Angeles Mayor Karen Bass (center) discusses wildfire recovery in Pacific Palisades, Calif., Jan. 27, 2025. Cleaning up after the wildfires, which destroyed more than 16,000 structures, will include disposing of several million tons of toxic ash and debris.
    Drew A. Kelley/MediaNews Group/Long Beach Press-Telegram via Getty Images

    In Houston, for example, court rulings after multiple years of severe flooding are forcing the city to spend $100 million on street repairs and drainage by mid-2025. This requirement will expand the deficit in Houston’s annual budget to $330 million.

    In Massachusetts, towns on Cape Cod are spending millions of dollars to switch from septic systems to public sewer lines and upgrade wastewater treatment plants. Population growth has sharply increased water pollution on the Cape, and climate change is promoting blooms of toxic algae that feed on nutrients in wastewater.

    Increasing uncertainty about the total costs of mitigating and adapting to climate change will inevitably lead rating agencies to downgrade municipal credit ratings. This raises cities’ costs to borrow money for climate-related projects like protecting shorelines and improving wastewater treatment.

    Underfunded pensions

    Cities also spend a lot of money on employees, and many large cities are struggling to fund pensions and health benefits for their workforces. As municipal retirees live longer and require more health care, the costs are mounting.

    For example, Chicago currently faces a budget deficit of nearly $1 billion, which stems partly from underfunded retirement benefits for nearly 30,000 public employees. The city has $35 billion in unfunded pension liabilities and almost $2 billion in unfunded retiree health benefits. Chicago’s teachers are owed $14 billion in unfunded benefits.

    Policy studies have shown for years that politicians tend to underfund retirement and pension benefits for public employees. This approach offloads the real cost of providing police, fire protection and education onto future taxpayers.

    Struggling downtowns and less federal support

    Cities aren’t just facing rising costs – they’re also losing revenues. In many U.S. cities, retail and commercial office economies are declining. Developers have overbuilt commercial properties, creating an excess supply. More unleased properties will mean lower tax revenues.

    At the same time, pandemic-related federal aid that cushioned municipal finances from 2020 through 2024 is dwindling.

    State and local governments received $150 billion through the 2020 Coronavirus Aid, Relief, and Economic Security (CARES) Act and an additional $130 billion through the 2021 American Rescue Plan Act. Now, however, this federal largesse – which some cities used to fill mounting fiscal cracks – is at an end.

    In my view, President Donald Trump’s administration is highly unlikely to bail out urban areas – especially more liberal cities like Detroit, Philadelphia and San Francisco. Trump has portrayed large cities governed by Democrats in the darkest terms – for example, calling Baltimore a “rodent-infested mess” and Washington, D.C., a “dirty, crime-ridden death trap.” I expect that Trump’s animus against big cities, which was a staple of his 2024 campaign, could become a hallmark of his second term.

    Detroit officials respond to disparaging remarks about the city by Donald Trump during a campaign speech in Detroit, Oct. 10, 2024.

    Resistance to new taxes

    Cities can generate revenue from taxes on sales, businesses, property and utilities. However, increasing municipal taxes – particularly property taxes – can be very difficult.

    In 1978, California adopted Proposition 13 – a ballot measure that limited property tax increases to the rate of inflation or 2% per year, whichever is lower. This high-profile campaign created a widespread narrative that property taxes were out of control and made it very hard for local officials to support property tax increases.

    Thanks to caps like Prop 13, a persistent public view that taxes are too high and political resistance, property taxes have tended to lag behind inflation in many parts of the country.

    The crunch

    Taking these factors together, I see a fiscal crunch coming for U.S. cities. Small cities with low budgets are particularly vulnerable. But so are larger, more affluent cities, such as San Francisco with its collapsing downtown office market, or Houston, New York and Miami, which face growing costs from climate change.

    Workers in North Miami Beach, Fla., distribute sandbags to residents to help prevent flooding as Hurricane Milton approaches the state on Oct. 8, 2024.
    AP Photo/Wilfredo Lee

    One city manager who runs an affluent municipality in the Pacific Northwest told me that in these difficult circumstances, politicians need to be more frank and open with their constituents and explain convincingly and compellingly how and why taxpayer money is being spent.

    Efforts to balance city budgets are opportunities to build consensus with the public about what municipalities can do, and at what cost. The coming months will show whether politicians and city residents are ready for these hard conversations.

    John Rennie Short does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

    ref. A fiscal crisis is looming for many US cities – https://theconversation.com/a-fiscal-crisis-is-looming-for-many-us-cities-249436

    MIL OSI AnalysisEveningReport.nz

  • MIL-OSI USA: Residential energy expenditures have increased with colder weather and higher prices

    Source: US Energy Information Administration

    In-brief analysis

    February 20, 2025


    Residential energy expenditures for homes heating with natural gas and propane for the current winter (November through March) have grown, and now we expect them to total 10% more than last winter. In our initial Winter Fuels Outlook forecasts published in October 2024, we had expected that homes mainly heating with natural gas would spend between 2% less or 7% more this winter than last, depending on weather conditions. As the winter has progressed and energy prices and consumption have increased beyond our initial expectations, we have revised these forecasts upward.

    Each October, we publish a Winter Fuels Outlook with forecasts for energy consumption, prices, and expenditures for U.S. households. We categorize homes based on their main heating fuel: natural gas, electricity, propane, or heating oil. Almost all U.S. homes (96% in 2023) use one of those four fuels as their main heating source.

    In each month from November through March, we update these forecasts based on actual weather and prices and the most recent Short-Term Energy Outlook forecasts for future weather and prices.

    Weather outcomes are a key source of uncertainty in our forecasts, so we provide three sets with different weather assumptions. Retail energy prices—especially for propane and heating oil—are sensitive to actual weather and the resulting effects on energy demand, supply, and wholesale prices.

    Residential propane and heating oil expenditures tend to have wider ranges of uncertainty in our forecasts. By comparison, natural gas and electricity prices tend to lag changes in wholesale prices because of the nature of utility regulation.

    Last month’s cold weather increased energy prices and consumption, both of which increased residential energy expenditures. We use population-weighted heating degree days (HDDs) as an indicator of heating demand, with more HDDs indicating colder weather. A typical January in the United States has 831 HDDs, based on the average of the previous 10 Januarys. However, January 2025 was much colder, with 927 HDDs.

    January’s cold weather increased natural gas consumption and resulted in near-record withdrawals of natural gas from storage. Similarly, U.S. propane inventories—which had been relatively full at the beginning of winter—were drawn down as consumption increased and are now near their previous five-year average. U.S. propane exports are also at record highs, which can also elevate domestic propane prices.

    Wholesale natural gas and propane prices increased in late 2024 and continued to increase in January. In our October 2024 forecast, we had expected wholesale natural gas and propane prices to increase during the winter, but the timing and magnitude of actual price increases were faster and greater than initially forecast.


    We will continue to update our Winter Fuels Outlook forecasts for residential energy consumption concurrently with each monthly update of our Short-Term Energy Outlook.

    Principal contributor: Office of Energy Analysis Staff

    MIL OSI USA News

  • MIL-OSI Europe: Slovakia receives €240 million EIB loan to co-finance green and digital projects supported by the EU

    Source: European Investment Bank

    • EIB provides €240 million loan to Slovakia to advance green and digital projects
    • Slovak government will use EIB long-term financing as national contribution mandatory for EU-financed development projects
    • Credit is first part of €800 million EIB facility approved to strengthen environmental sustainability and economic competitiveness of Slovakia

    The European Investment Bank (EIB) is providing a €240 million loan to Slovakia for co-funding of EU-supported green and digital projects across the country. The credit is the first part of an €800 million EIB loan approved to Slovakia for national contributions mandatory for European Union-supported project which bring billions of euros to member states annually.

    “We are increasing the country’s ability to tap EU grants, enabling Slovak citizens and businesses to benefit from accelerated economic growth and social development,” said EIB Vice-President Kyriacos Kakouris. “Our financing will strengthen cohesion and improve public services, the business environment and living standards in Slovakia.”

    Slovakia will use EIB funding for projects designed to improve research and innovation, digitization of economy, growth and competitiveness of SMEs, work skills for smart specialization, transition and digital connectivity, energy efficiency and renewable energy, climate change adaptation, sustainable water, circular economy and nature protection and biodiversity.

    In addition to helping green Slovakia’s economy, such projects will enhance the country’s living standards and strengthen its competitiveness on global markets.

     “This EIB loan will enable us to support projects that drive digital innovation, expand renewable energy, and enhance climate resilience. Our partnership with the EIB ensures that Slovakia remains at the forefront of the EU’s sustainability goals while fostering job creation and economic resilience in our regions. We are dedicated to using these funds wisely to build a smarter, cleaner, and more competitive economy,” said the Slovak Minister of Finance Ladislav Kamenický.

     EIB annual results in Slovakia for 2024

    In 2024, the EIB Group increased its financing in Slovakia by 21% to €355 million. Key initiatives last year included €50 million to support eco-friendly water and wastewater management in Bratislava and €65 million to help Slovak small and medium enterprises (SMEs) and Mid-Caps drive job creation, enhance competitiveness and advance climate action goals.

    “Our 2024 results are good news for Slovakia and the EU,” said EIB Vice- President Kakouris. “We financed projects of vital importance for a sustainable, green and prosperous future for Slovakia. Our commitment to Slovakia remains strong and, as the country pursues its development goals, it can continue to rely on the EIB for support.”

    EIB advisory activities in the country last year included addressing affordable-housing challenges in Bratislava. Expanding affordable housing across the EU is one of eight operational priorities for the EIB.

     Background information

     European Investment Bank: The European Investment Bank (ElB) is the long-term lending institution of the European Union, owned by its Member States. Built around eight core priorities, we finance investments that contribute to EU policy objectives by bolstering climate action and the environment, digitalisation and technological innovation, security and defence, cohesion, agriculture and bioeconomy, social infrastructure, the capital markets union, and a stronger Europe in a more peaceful and prosperous world.

     The EIB Group, which also includes the European Investment Fund (EIF), signed nearly €89 billion in new financing for over 900 high-impact projects in 2024, boosting Europe’s competitiveness and security. 

    All projects financed by the EIB Group are in line with the Paris Climate Agreement, as pledged in our Climate Bank Roadmap. Almost 60% of the EIB Group’s annual financing supports projects directly contributing to climate change mitigation, adaptation, and a healthier environment. 

    Fostering market integration and mobilising investment, the Group supported a record of over €100 billion in new investment for Europe’s energy security in 2024 and mobilised €110 billion in growth capital for startups, scale-ups and European pioneers

    Approximately half of the EIB’s financing within the European Union is directed towards cohesion regions, where per capita income is lower than the EU average.

    MIL OSI Europe News

  • MIL-OSI Europe: SEK 22 billion in EIB financing provided for Swedish firms and municipalities in 2024

    Source: European Investment Bank

    • The city of Stockholm, SKF, Ericsson, Tele2 and Chromafora were some of the actors in Sweden granted EU financing in 2024 through the EIB Group.
    • This financing amounted to around SEK 22 billion (€1.9 billion) and more than 65% of this went to initiatives supporting the green transition.
    • Just over 32 000 jobs are estimated to have been saved thanks to this financing.

    Over the course of 2024, the European Investment Bank (EIB) and the European Investment Fund (EIF) continued to support Sweden’s economic development and climate initiatives through substantial investments.

    The EIB Group’s financing during the year amounted to around SEK 22 billion, of which more than 60% went to climate measures and environmental sustainability. This money supported wind power, energy-efficient housing and industrial electrification, among other projects.

    These investments are estimated to have kept 32 000 jobs in Sweden.

    “Sweden has come a long way in the green transition, but the work is far from complete. As the EU climate bank, we are proud to be accelerating efforts within renewable energy, electrification and other climate-promoting initiatives, and we will continue to support investments that make a real difference for the climate and society as a whole. We are also proud to contribute to jobs and strong infrastructure, which creates long-term value for Swedish society,” said EIB Vice-President Thomas Östros.

    Over the course of 2024, the EIB Group signed more than 20 agreements to provide financing in Sweden. Here are a few examples:

    SKF: €430 million for research and innovation in fields such as renewable energy and electromobility.

    Chromafora: €22.5 million to combat PFAS (“forever chemicals”).

    Tele2: €140 million to expand the 5G network in order to reach 99% of the Swedish population.

    City of Stockholm: €368 million to redevelop the Slussen area and reduce the risk of flooding.

    City of Malmö: €225 million to build more than 1 500 energy-efficient apartments.

    These investments reflect the EIB Group’s extensive involvement in Sweden’s green transition, digitalisation and social development.

    The European Investment Fund (EIF) – which is part of the EIB – allocated €320 million to capital investments and guarantees in Sweden in 2024. This in turn is expected to mobilise around SEK 3.8 billion in investment for the Swedish economy, with more than 5 300 companies expected to benefit from this financing in different ways.

    Several of the initiatives are supported by the European Commission’s InvestEU programme.

    In addition to investing in funds such as Course Corrected and the Swedish Impact Lending Fund, the EIF also issued guarantees for businesses such as the corporate lender Froda.

    Please note: The figures provided in this press release are approximate and subject to exchange rates.

     Background information

    EIB

    The European Investment Bank (EIB) is the long-term lending institution of the European Union, owned by its Member States. The EIB finances investments that contribute to EU policy objectives. EIB projects bolster competitiveness, drive innovation, promote sustainable development, enhance social and territorial cohesion, and support a just and swift transition to climate neutrality.

    All projects financed by the EIB Group are in line with the Paris Climate Agreement. The EIB Group does not fund investments in fossil fuels. We are on track to deliver on our commitment to support €1 billion in climate and environmental sustainability investment in the decade to 2030 as pledged in our Climate Bank Roadmap. Almost 60% of the EIB Group’s annual financing supports projects directly contributing to climate change mitigation, adaptation, and a healthier environment.

    Approximately half of the EIB’s financing within the European Union is directed towards cohesion regions, where per capita income is lower than the EU average. This underscores the Bank’s commitment to fostering inclusive growth and the convergence of living standards.

    MIL OSI Europe News

  • MIL-OSI: TransAlta Reports Strong 2024 Results, Announces Dividend Increase and 2025 Annual Guidance

    Source: GlobeNewswire (MIL-OSI)

    CALGARY, Alberta, Feb. 20, 2025 (GLOBE NEWSWIRE) — TransAlta Corporation (TransAlta or the Company) (TSX: TA) (NYSE: TAC) today reported its financial results for the fourth quarter and year ended Dec. 31, 2024.

    “Our business delivered solid results within the upper range of our guidance, driven by high availability across our generation portfolio, along with the enduring performance of our optimization and hedging strategies. During the year, we added 2.2 GW of generation to our fleet, with three contracted wind facilities achieving commercial operation in addition to the acquisition of Heartland Generation. We also returned $214 million, or $0.71 per share, of value to shareholders through dividends and share repurchases at an average price of $10.59 per share,” said John Kousinioris, President and Chief Executive Officer of TransAlta.

    “Given our confidence in the future, we are pleased to announce that our Board of Directors has approved an eight per cent increase to our common share dividend, now equivalent to $0.26 per share on an annualized basis. This represents our sixth consecutive annual dividend increase, affirming our Company’s commitment to returning value to shareholders,” added Mr. Kousinioris.

    “Our portfolio of generating facilities continues to perform well. In 2025, we expect to generate between $450 and $550 million of free cash flow. We maintain a balanced, prudent and disciplined approach to capital allocation and balance sheet strength. We remain focused on advancing development opportunities at our legacy thermal energy campuses, along with pursuing longer term growth options with a commitment to maximizing shareholder value. Looking to 2025 and beyond, I am optimistic about our Company’s momentum and opportunities.”

    Fourth Quarter 2024 Financial Highlights

    • Adjusted EBITDA(1) of $285 million, compared to $289 million for the same period in 2023
    • Free Cash Flow (FCF)(1) of $48 million, or $0.16 per share, compared to $121 million, or $0.39 per share, for the same period in 2023
    • Cash flow from operating activities of $215 million, compared to $310 million from the same period in 2023
    • Net loss attributable to common shareholders of $65 million, or $0.22 per share, compared to $84 million, or $0.27 per share, for the same period in 2023

    Full Year 2024 Financial Highlights

    • Achieved the upper range of both 2024 adjusted EBITDA and FCF guidance
    • Returned $143 million of capital to common shareholders through the buyback of 13.5 million common shares at an average price of $10.59 per share
    • Adjusted EBITDA of $1,253 million, compared to $1,632 million from the same period in 2023
    • FCF of $569 million, or $1.88 per share, compared to $890 million, or $3.22 per share, from the same period in 2023
    • Net earnings attributable to common shareholders of $177 million, or $0.59 per share, compared to $644 million, or $2.33 per share, from the same period in 2023
    • Exited 2024 with a strong financial position, with adjusted net debt to adjusted EBITDA of 3.6 times and available liquidity of $1.6 billion

    Other Business Highlights and Updates

    • Announced an annual dividend increase of eight per cent, now equivalent to $0.26 per share on an annualized basis, which represents the sixth year of consecutive dividend growth
    • Provided 2025 guidance including adjusted EBITDA of $1.15 to $1.25 billion and FCF of $450 to $550 million, or $1.51 to $1.85 per share
    • Completed the acquisition of Heartland Generation at a purchase price of $542 million in December 2024, which added 1.7 GW to gross installed capacity
    • Achieved strong operational availability of 91.2 per cent in 2024, compared to 88.8 per cent in 2023
    • 2024 Total Recordable Injury Frequency of 0.56 compared to 0.30 in 2023
    • Reduced scope 1 and 2 GHG emissions intensity in 2024 to 0.35 tCO2e/MWh from 2023 levels of 0.41 tCO2e/MWh
    • Achieved commercial operation at the White Rock West and East wind facilities in January and April 2024, respectively
    • Achieved commercial operation at the Horizon Hill facility in May 2024
    • Completed the Mount Keith 132kV expansion project during the first quarter of 2024

    Key Business Developments

    Declared Increase in Common Share Dividend
    The Company’s Board of Directors has approved a $0.02 annualized increase to the common share dividend, or 8 per cent increase, and declared a dividend of $0.065 per common share to be payable on July 1, 2025 to shareholders of record at the close of business on June 1, 2025. The quarterly dividend of $0.065 per common share represents an annualized dividend of $0.26 per common share.

    TransAlta Acquired Heartland Generation from Energy Capital Partners

    On Dec. 4, 2024, the Company closed the acquisition of Heartland Generation Ltd. and certain affiliates (collectively, Heartland) for a purchase price of $542 million from an affiliate of Energy Capital Partners (ECP), the parent of Heartland (the Transaction). To meet the requirements of the federal Competition Bureau, the Company entered into a consent agreement with the Commissioner of Competition pursuant to which TransAlta agreed to divest Heartland’s Poplar Hill and Rainbow Lake assets (the Planned Divestitures) following closing of the Transaction. In consideration of the Planned Divestitures, TransAlta and ECP agreed to a reduction of $80 million from the original purchase price for the Transaction. ECP will be entitled to receive the proceeds from the sale of Poplar Hill and Rainbow Lake, net of certain adjustments following completion of the Planned Divestitures. TransAlta also received a further $95 million at closing of the Transaction to reflect the economic benefit of the Heartland business arising from Oct. 31, 2023 to the closing date of the Transaction, pursuant to the terms of the share purchase agreement. The net cash payment for the Transaction, before working capital adjustments, totalled $215 million, and was funded through a combination of cash on hand and draws on TransAlta’s credit facilities.

    Excluding the Planned Divestitures, the Transaction adds 1.7 GW (net interest) of complementary capacity from nine facilities, including contracted cogeneration and peaking generation, legacy gas-fired thermal generation, and transmission capacity, all of which will be critical to support reliability in the Alberta electricity market.

    Mothballing of Sundance Unit 6

    On Nov. 4, 2024, the Company provided notice to the Alberta Electric System Operator (AESO) that Sundance Unit 6 will be mothballed on April 1, 2025, for a period of up to two years depending on market conditions. TransAlta maintains the flexibility to return the mothballed unit to service when market fundamentals improve or opportunities to contract are secured. The unit remains available and fully operational for the first quarter of 2025.

    Production Tax Credit (PTC) Sale Agreements

    On Feb. 22, 2024, the Company entered into 10-year transfer agreements with an AA- rated customer for the sale of approximately 80 per cent of the expected PTCs to be generated from the White Rock and the Horizon Hill wind facilities.

    On June 21, 2024, the Company entered into an additional 10-year transfer agreement with an A+ rated customer for the sale of the remaining 20 per cent of the expected PTCs.

    The expected average annual EBITDA(1) from the two agreements is approximately $78 million (US$57 million).

    Normal Course Issuer Bid (NCIB)

    TransAlta remains committed to enhancing shareholder returns through appropriate capital allocation such as share buybacks and its quarterly dividend. In the first quarter of 2024, the Company announced an enhanced common share repurchase program for 2024, allocating up to $150 million, and targeting up to 42 per cent of 2024 FCF guidance, to be returned to shareholders in the form of share repurchases and dividends.

    On May 27, 2024, the Company announced that it had received approval from the Toronto Stock Exchange to purchase up to 14 million common shares pursuant to an NCIB during the 12-month period that commenced May 31, 2024, and terminates May 31, 2025. Any common shares purchased under the NCIB will be cancelled.

    For the year ended Dec. 31, 2024, the Company purchased and cancelled a total of 13,467,400 common shares at an average price of $10.59 per common share, for a total cost of $143 million, including taxes.

    Horizon Hill Wind Facility Achieves Commercial Operation

    On May 21, 2024, the 202 MW Horizon Hill wind facility achieved commercial operation. The facility is located in Logan County, Oklahoma and is fully contracted to Meta Platforms Inc. for the offtake of 100 per cent of the generation.

    White Rock Wind Facilities Achieve Commercial Operation

    On Jan. 1, 2024, the 100 MW White Rock West wind facility achieved commercial operation. On April 22, 2024, the 202 MW White Rock East wind facility also completed commissioning. The facilities are located in Caddo County, Oklahoma and are contracted under two long-term power purchase agreements (PPAs) with Amazon Energy LLC for the offtake of 100 per cent of the generation.

    Mount Keith 132kV Expansion Complete

    The Mount Keith 132kV expansion project, located in Western Australia, was completed during the first quarter of 2024. The expansion was developed under the existing PPA with BHP Nickel West (BHP), which extends until Dec. 31, 2038. The expansion will facilitate the connection of additional generating capacity to the transmission network which supports BHP’s operations.

    Year Ended and Fourth Quarter 2024 Highlights

    $ millions, unless otherwise stated Year Ended Three Months Ended
    Dec. 31, 2024 Dec. 31, 2023 Dec. 31, 2024   Dec. 31, 2023  
    Operational information        
    Availability (%) 91.2 88.8 87.8   86.9  
    Production (GWh) 22,811 22,029 6,199   5,783  
    Select financial information        
    Revenues 2,845 3,355 678   624  
    Adjusted EBITDA(1) 1,253 1,632 285   289  
    Earnings (loss) before income taxes 319 880 (51 ) (35 )
    Net earnings (loss) attributable to common shareholders 177 644 (65 ) (84 )
    Cash flows        
    Cash flow from operating activities 796 1,464 215   310  
    Funds from operations(1) 810 1,351 137   229  
    Free cash flow(1) 569 890 48   121  
    Per share        
    Net earnings (loss) per share attributable to common shareholders, basic and diluted 0.59 2.33 (0.22 ) (0.27 )
    Funds from operations per share(1),(2) 2.68 4.89 0.46   0.74  
    FCF per share(1),(2) 1.88 3.22 0.16   0.39  
    Dividends declared per common share 0.24 0.22 0.12   0.12  
    Weighted average number of common shares outstanding 302 276 298   308  


    Segmented Financial Performance

    $ millions

    Year Ended Three Months Ended
    Dec. 31, 2024   Dec. 31, 2023   Dec. 31, 2024   Dec. 31, 2023  
    Hydro 316   459   57   56  
    Wind and Solar 316   257   95   82  
    Gas 535   801   116   141  
    Energy Transition 91   122   28   26  
    Energy Marketing 131   109   27   14  
    Corporate (136 ) (116 ) (38 ) (30 )
    Adjusted EBITDA 1,253   1,632   285   289  
    Earnings (loss) before
    income taxes
    319   880   (51 ) (35 )


    Full Year 2024 Financial Results Summary

    For the year ended Dec. 31, 2024, the Company demonstrated strong financial and operational performance. The results were within the upper range of management’s expectations due to active management of the Company’s merchant portfolio and hedging strategies. During 2024, the Company settled a higher volume of hedges at prices that were significantly above the spot market in Alberta and achieved commercial operation at the White Rock and Horizon Hill wind facilities. On Dec. 4, 2024, the Company completed the acquisition of Heartland Generation, which added 1.7 GW to gross installed capacity. Refer to the Significant and Subsequent Events section of our MD&A dated Dec. 31, 2024, for details on the Heartland acquisition and the Planned Divestitures.

    Availability for the year ended Dec. 31, 2024, was 91.2 per cent, compared to 88.8 per cent in 2023, an increase of 2.4 percentage points, primarily due to:

    • The addition of the White Rock and Horizon Hill wind facilities; and
    • The return to service of the Kent Hills wind facilities.

    Total production for the year ended Dec. 31, 2024, was 22,811 GWh, compared to 22,029 GWh for the same period in 2023, an increase of 782 GWh, or four per cent, primarily due to:

    • Production from new facilities, including the White Rock West and East wind facilities commissioned in January and April 2024, respectively, the Horizon Hill wind facility commissioned in May 2024, and the Northern Goldfields solar facilities commissioned in November 2023;
    • Production from the facilities acquired with Heartland;
    • Favourable market conditions in the Ontario wholesale power market that enabled higher dispatch at the Sarnia facility in the Gas segment that resulted in higher merchant production to the Ontario grid;
    • The return to service of the Kent Hills wind facilities in the first quarter of 2024; and
    • Full-year production from the Garden Plain wind facility; partially offset by
    • Increased economic dispatch at the Centralia facility due to lower market prices compared to the prior year in the Energy Transition segment; and
    • Higher dispatch optimization in Alberta.

    Adjusted EBITDA for the year ended Dec. 31, 2024, was $1,253 million, compared to $1,632 million in 2023, a decrease of $379 million, or 23.2 per cent. The major factors impacting adjusted EBITDA include:

    • Gas adjusted EBITDA decreased by $266 million, or 33 per cent, compared to 2023, primarily due to lower power prices in the Alberta market and resulting increase in economic dispatch, an increase in the price of carbon, higher carbon costs and fuel usage related to production and lower capacity payments, partially offset by a higher volume of favourable hedging positions settled, the utilization of emission credits to settle a portion of our 2023 GHG obligation and lower natural gas prices;
    • Hydro adjusted EBITDA decreased by $143 million, or 31 per cent, compared to 2023, primarily due to lower spot power prices and ancillary services prices in the Alberta market, partially offset by realized premiums above the spot power prices, higher environmental and tax attributes revenues due to higher sales of emission credits to third parties and intercompany sales to the Gas segment and higher ancillary service volumes due to increased demand by the AESO;
    • Energy Transition adjusted EBITDA decreased by $31 million, or 25 per cent, compared to 2023, primarily due to increased economic dispatch driven by lower market prices which negatively impacted merchant production, partially offset by lower fuel and purchased power costs; and
    • Corporate adjusted EBITDA decreased by $20 million, or 17 per cent, compared to 2023, primarily due to higher spending to support strategic and growth initiatives; partially offset by
    • Wind and Solar adjusted EBITDA increasing by $59 million, or 23 per cent, compared to 2023, primarily due to new sales of production tax credits, the return to service of the Kent Hills wind facilities, the commercial operation of the White Rock and Horizon Hill wind facilities, partially offset by lower realized power pricing in the Alberta market and higher OM&A due to the addition of new wind facilities; and
    • Energy Marketing adjusted EBITDA increasing by $22 million, or 20 per cent, compared to 2023, primarily due to favourable market volatility and timing of realized settled trades during the current year in comparison to the prior year and lower OM&A.

    Cash flow from operating activities totalled $796 million for the year ended Dec. 31, 2024, compared to $1,464 million in the same period in 2023, a decrease of $668 million, or 46 per cent, primarily due to:

    • Lower gross margin due to lower revenues, excluding the effect of unrealized losses from risk management activities, partially offset by lower fuel and purchased power;
    • Higher OM&A due to increased spending on planning and design of an ERP system upgrade, higher spending on strategic and growth initiatives, penalties assessed by the Alberta Market Surveillance Administrator for self-reported contraventions and Heartland acquisition-related transaction and restructuring costs;
    • Higher current income tax expense due to the full utilization of Canadian non-capital loss carryforwards in 2023, which was partially offset by lower earnings before income tax in 2024;
    • Unfavourable change in non-cash operating working capital balances due to lower accounts payables and accrued liabilities, partially offset by lower collateral provided as a result of market price volatility;
    • Higher interest expense on debt primarily due to lower capitalized interest resulting from lower construction activity in 2024 compared to 2023; and
    • Lower interest income due to lower cash balances and lower interest rates.

    FCF totalled $569 million for the year ended Dec. 31, 2024, compared to $890 million for the same period in 2023, a decrease of $321 million, or 36 per cent, primarily driven by:

    • The adjusted EBITDA items noted above;
    • Higher current income tax expense due to the full utilization of Canadian non-capital loss carryforwards in 2023, partially offset by lower earnings before income taxes in 2024; and
    • Higher net interest expense due to lower capitalized interest resulting from lower construction activity in 2024 compared to 2023, and lower interest income due to lower cash balances and interest rates in 2024 compared to prior year; partially offset by
    • Lower distributions paid to subsidiaries’ non-controlling interests relating to lower TA Cogen net earnings resulting from lower merchant pricing in the Alberta market and the cessation of distributions to TransAlta Renewables non-controlling interest;
    • Lower sustaining capital expenditures due to the receipt of a lease incentive related to the Company’s head office and lower planned major maintenance at our Alberta and Western Australian gas facilities, partially offset by higher major maintenance at our Alberta Hydro assets; and
    • Higher provisions accrued in the current year compared to the prior year resulting in higher FCF.

    Earnings before income taxes totalled $319 million for the year ended Dec. 31, 2024, compared to $880 million in the same period in 2023, a decrease of $561 million, or 64 per cent.

    Net earnings attributable to common shareholders totalled $177 million for the year ended Dec. 31, 2024, compared to $644 million in the same period in 2023, a decrease of $467 million, or 73 per cent, primarily due to:

    • The adjusted EBITDA items discussed above;
    • Higher asset impairment charges due to an increase in decommissioning and restoration provisions on retired assets, driven by a decrease in discount rates and revisions in estimated decommissioning costs and higher impairment charges related to development projects that are no longer proceeding;
    • Lower unrealized mark-to-market gains and lower realized gains on closed exchange positions in the Energy Marketing segment mainly driven by market volatility across North American power and natural gas markets;
    • Higher unrealized mark-to-market losses recorded in the Wind and Solar segment primarily related to the long-term wind energy sales at the Oklahoma facilities;
    • Higher interest expense due to lower capitalized interest during 2024 resulting from lower construction activity in 2024 compared to 2023;
    • Lower capacity payments in 2024 for Southern Cross Energy in Western Australia due to the scheduled conclusion on Dec. 31, 2023 of the demand capacity charge under the customer contract, partially offset by the commencement in March 2024 of capacity payments for the Mount Keith 132kV expansion;
    • Heartland acquisition-related transaction and restructuring costs;
    • Lower interest income due to lower cash balances and lower interest rates during 2024;
    • Higher spending in connection with planning and design work on a planned upgrade to the ERP system;
    • Lower income tax expense due to lower earnings; and
    • Penalties assessed by the Alberta Market Surveillance Administrator for self-reported contraventions pertaining to Hydro ancillary services provided during 2021 and 2022; partially offset by
    • Lower depreciation and amortization compared to 2023 related to revisions of useful lives of certain facilities in prior and current periods, partially offset by the commercial operation of new facilities during the year and the return to service of the Kent Hills wind facilities;
    • Higher unrealized mark-to-market gains recorded in the Energy Transition segment primarily related to favourable changes in forward prices;
    • A recovery related to the reversal of previously derecognized Canadian deferred tax assets; and
    • Higher net other operating income mainly due to Sundance A decommissioning cost reimbursement.

    Fourth Quarter Financial Results Summary

    Fourth quarter 2024 results were in-line with management’s expectations due to active management of the Company’s merchant portfolio and hedging strategies, despite lower power prices in the Alberta and mid-Columbia markets. The Company settled a higher volume of hedges that were significantly above average spot prices during the period. The acquisition of Heartland on Dec. 4, 2024 positively contributed to production in the Gas segment and further diversifies TransAlta’s competitive portfolio in the highly dynamic and shifting electricity landscape in Alberta by adding 1.7 GW to gross installed capacity.

    Availability for the three months ended Dec. 31, 2024, was 87.8 per cent, compared to 86.9 per cent for the same period in 2023, an increase of 0.9 percentage points, primarily due to:

    • The addition of the White Rock and Horizon Hill wind facilities which operated with high availability;
    • The return to service of the Kent Hills wind facilities;
    • Higher availability in the Hydro segment due to lower planned outages;
    • Higher availability in the Energy Transition segment due to lower unplanned outages; and
    • Positive contribution from the addition of the gas facilities acquired with Heartland; partially offset by
    • Lower availability for the Gas segment due to planned outages at Sarnia, Sheerness and Keephills.

    Production for the three months ended Dec. 31, 2024, was 6,199 GWh, compared to 5,783 GWh for the same period in 2023. The increase of 416 GWh, or seven per cent, was primarily due to:

    • Higher production in the Wind and Solar segment due to the addition of the Horizon Hill and White Rock West and East wind facilities during 2024;
    • Higher production in the Hydro segment compared to the same period in 2023 due to water conservation in the fourth quarter of 2023 that resulted in lower production volumes compared to the current period; partially offset by
    • Lower production in the Energy Transition segment due to higher dispatch optimization, which negatively affected merchant production; and
    • Lower production in the Gas segment driven by lower availability at the Sarnia facility due to planned outages, higher economic dispatch in Alberta and lower production from Western Australia due to lower demand, partially offset by positive contribution from the Heartland gas facilities.

    Adjusted EBITDA for the three months ended Dec. 31, 2024, was $285 million, compared to $289 million in the same period of 2023, a decrease of $4 million, or one per cent. The major factors impacting adjusted EBITDA are summarized below:

    • Gas adjusted EBITDA decreased by $25 million, or 18 per cent, due to lower realized power prices in Alberta, an increase in the carbon price in Canada and higher OM&A driven by higher maintenance costs at the South Hedland facility, partially offset by a higher volume of favourable hedging positions settled, positive contribution from the Heartland gas facilities and lower capacity payments;
    • Corporate adjusted EBITDA decreased by $8 million, or 27 per cent, due to higher spending to support strategic and growth initiatives; partially offset by
    • Wind and Solar adjusted EBITDA increasing by $13 million, or 16 per cent, due to environmental and tax attributes revenues from the sale of PTCs from the White Rock and Horizon Hill wind facilities to taxable US counterparties, higher revenues driven by increased production from the addition of the White Rock and Horizon Hill wind facilities and the return to service of the Kent Hills wind facilities, partially offset by unfavourable merchant power prices in Alberta;
    • Energy Marketing adjusted EBITDA increasing by $13 million, or 93 per cent, due to favourable market volatility and the timing of realized settled trades during 2024 in comparison to the same period in 2023;
    • Energy Transition adjusted EBITDA increasing by $2 million, or eight per cent, compared to 2023, primarily due to lower fuel and purchased power costs, partially offset by increased economic dispatch due to lower market prices; and
    • Hydro adjusted EBITDA increasing by $1 million, or two per cent, due to higher merchant revenues driven by higher volumes, partially offset by lower spot power prices and lower environmental and tax attributes revenues.

    FCF totalled $48 million for the three months ended Dec. 31, 2024, compared to $121 million in the same period in 2023, a decrease of $73 million, or 60 per cent, primarily due to:

    • The adjusted EBITDA items noted above;
    • Higher realized foreign exchange losses compared to realized foreign exchange gains in the comparative period;
    • Higher current income tax expense due to the full utilization of Canadian non-capital loss carryforwards in 2023, partially offset by a higher loss before income taxes in the current period compared to the same period in 2023;
    • Higher net interest expense due to lower capitalized interest as a result of capital projects being completed in the first half of 2024 and lower interest income due to lower cash balances in 2024; and
    • Higher dividends paid on preferred shares; partially offset by
    • Lower distributions paid to subsidiaries’ non-controlling interests due to lower TA Cogen net earnings;
    • Lower sustaining capital due to lower planned maintenance at the Alberta gas facilities, partially offset by higher planned maintenance at the Sarnia cogeneration facility and Alberta hydro facilities; and
    • Higher provisions accrued in the current year compared to the prior year resulting in higher FCF.

    Net loss attributable to common shareholders for the three months ended Dec. 31, 2024, was $65 million, compared to a net loss of $84 million in the same period of 2023, an improvement of $19 million, or 23 per cent, primarily due to:

    • The adjusted EBITDA items discussed above;
    • Higher interest expense due to lower capitalized interest in the fourth quarter of 2024 resulting from lower capital activity compared to the same period in 2023;
    • Heartland acquisition-related transaction and restructuring costs in the fourth quarter of 2024;
    • Higher ERP upgrade costs related to planning and design work;
    • Penalties assessed by the Alberta Market Surveillance Administrator for self-reported contraventions pertaining to Hydro ancillary services provided during 2021 and 2022;
    • Higher depreciation and amortization due to the commercial operation of the White Rock and Horizon Hill wind facilities during 2024; and
    • Higher taxes other than income taxes, mainly consisting of property taxes due to the addition of new wind facilities during 2024; partially offset by
    • Higher realized and unrealized foreign exchange gains;
    • Lower realized gains on closed exchange positions in 2024 compared to the same period in 2023;
    • An income tax recovery relative to the prior period expense as a result of a higher loss before income taxes due to the above noted items; in addition to lower non-deductible expenses;
    • Lower net earnings attributable to non-controlling interest compared to the same period in 2023 due to lower merchant pricing in the Alberta market;
    • Higher net other operating income mainly due to Sundance A decommissioning cost reimbursement; and
    • Lower asset impairment charges related to the decommissioning and restoration provisions on retired assets driven by lower discount rates in the current period compared to the same period in 2023, partially offset by impairment charges related to development projects that are no longer proceeding.

    Alberta Electricity Portfolio

    For the three months and year ended Dec. 31, 2024, the Alberta electricity portfolio generated 3,150 GWh and 11,809 GWh, respectively, compared to 2,989 GWh and 11,759 GWh, respectively, in the same periods in 2023. The annual production increase of 50 GWh, or 0.4 per cent, was primarily due to:

    • Higher production in the Gas segment due to the addition of gas facilities from the acquisition of Heartland; and
    • A full-year of production from the addition of the Garden Plain wind facility, which was commissioned in August 2023; partially offset by
    • Higher dispatch optimization in the Gas segment; and
    • Lower production from the Alberta hydro facilities due to lower water resources compared to the prior year.

    The fourth quarter production increase of 161 GWh, or five per cent, benefited from:

    • Higher production from the Gas segment due to the Heartland acquisition; and
    • Higher production from the Alberta hydro facilities due to significant water conservation during the fourth quarter of 2023; partially offset by
    • Higher economic dispatch for the Alberta gas facilities; and
    • Lower production in the Wind and Solar segment due to lower wind resource.

    Gross margin for the Alberta portfolio for the three months and year ended Dec. 31, 2024, was $191 million and $856 million, respectively, a decrease of $24 million and $392 million, respectively, compared to the same periods in 2023. The annual decrease was primarily due to:

    • The impact of lower Alberta spot power prices and lower hydro ancillary services prices;
    • Increased dispatch optimization in the Gas segment driven by lower power prices; and
    • An increase in the carbon price per tonne from $65 in 2023 to $80 in 2024; partially offset by
    • Higher gains realized on financial hedges settled in the period;
    • Higher environmental and tax attributes revenues due to the increased sales of emission credits to third parties and intercompany sales from the Hydro segment to the Gas segment;
    • The utilization of emission credits in the Gas segment in 2024 to settle a portion of our 2023 GHG obligation;
    • Higher hydro ancillary services volumes due to increased demand by the AESO; and
    • Lower natural gas prices.

    Gross margin for the three months ended Dec. 31, 2024 was impacted by:

    • Lower Alberta spot power prices;
    • Higher carbon compliance costs due to increase in the carbon price from $65 per tonne in 2023 to $80 per tonne in 2024; and
    • Higher purchased power due to the contractual requirement to fulfill physical power trades; partially offset by
    • Higher gains realized on financial hedges settled in the period.

    Alberta power prices for 2024 were lower compared to 2023. The average spot power price per MWh for the three months and year ended Dec. 31, 2024, was $52 and $63, respectively, compared to $82 and $134, respectively, in the same periods in 2023. This was primarily due to:

    • Higher generation from the addition of increased supply of new renewables and combined-cycle gas facilities into the market compared to the prior period; and
    • Lower natural gas prices.

    Hedged volumes for the three months and year ended Dec. 31, 2024, were 2,637 GWh and 9,080 GWh at an average price of $80 per MWh and $84 per MWh, respectively, compared to 1,824 GWh and 7,550 GWh at an average price of $90 per MWh and $110 per MWh, respectively, in 2023.

    Liquidity and Financial Position

    We maintain adequate available liquidity under our committed credit facilities. As at Dec. 31, 2024, we had access to $1.6 billion in liquidity, including $336 million in cash, which exceeds the funds required for committed growth, sustaining capital and productivity projects.

    2025 Outlook and Financial Guidance

    For 2025, management expects adjusted EBITDA to be in the range of $1.15 to $1.25 billion and FCF to be in the range of $450 to $550 million, based on the following, relative to 2024:

    • Higher contribution from the wind and solar portfolio due to a full-year impact of new asset additions of the White Rock and Horizon Hill wind facilities;
    • Contribution from assets acquired with Heartland;
    • Lower contributions from the legacy merchant hydro, wind and gas assets in Alberta which are expected to step down due to lower expected average power prices in Alberta given baseload gas and renewables supply additions in late 2024 and 2025;
    • Lower current income tax expense in 2025 compared to 2024 actual; and
    • Increased net interest expense in 2025 as a result of the Heartland acquisition and lower interest income earned on lower cash deposits and lower capitalized interest on growth projects.

    The following table outlines our expectations regarding key financial targets and related assumptions for 2025 and should be read in conjunction with the narrative discussion that follows and the Governance and Risk Management section of the MD&A for additional information:

    Measure 2025 Target 2024 Target 2024 Actual
    Adjusted EBITDA $1,150 to $1,250 million $1,150 to $1,300 million $1,253 million
    FCF $450 to $550 million $450 to $600 million $569 million
    FCF per share $1.51 to $1.85 $1.47 to $1.96 $1.88
    Annual dividend per share $0.26 annualized $0.24 annualized $0.24 annualized

    The Company’s outlook for 2025 may be impacted by a number of factors as detailed further below.

    Market 2025 Assumptions 2024 Assumptions 2024 Actual
    Alberta spot ($/MWh) $40 to $60 $75 to $95 $63
    Mid-Columbia spot (US$/MWh) US$50 to US$70 US$85 to US$95 US$76
    AECO gas price ($/GJ) $1.60 to $2.10 $2.50 to $3.00 $1.29

    Alberta spot price sensitivity: a +/- $1 per MWh change in spot price is expected to have a +/-$3 million impact on adjusted EBITDA for 2025.

    Other assumptions relevant to the 2025 outlook

      2025 Assumptions 2024 Assumptions 2024 Actual
    Energy Marketing gross margin $110 to $130 million $110 to $130 million $167 million
    Sustaining capital $145 to $165 million $130 to $150 million $142 million
    Current income tax expense $95 to $130 million $95 to $130 million $143 million
    Net interest expense $255 to $275 million $240 to $260 million $231 million
    Hedging assumptions Q1 2025 Q2 2025 Q3 2025 Q4 2025  2026
    Hedged production (GWh)  2,117  1,758  1,942  1,845  4,713
    Hedge price ($/MWh) $72 $70 $70 $70 $75
    Hedged gas volumes (GJ) 14 million 6 million 6 million 6 million 18 million
    Hedge gas prices ($/GJ) $2.98 $3.63 $3.77 $3.65 $3.67


    Conference call

    TransAlta will host a conference call and webcast at 9:00 a.m. MST (11:00 a.m. EST) today, Feb. 20, 2025, to discuss our fourth quarter and year end 2024 results. The call will begin with comments from John Kousinioris, President and Chief Executive Officer, and Joel Hunter, EVP Finance and Chief Financial Officer, followed by a question-and-answer period.

    Fourth Quarter and Full Year 2024 Conference Call

    Webcast link: https://edge.media-server.com/mmc/p/zd49obg6 

    To access the conference call via telephone, please register ahead of time using the call link here: https://register.vevent.com/register/BI5c12d9a2da0e4e06892f413e217f0350. Once registered, participants will have the option of 1) dialing into the call from their phone (via a personalized PIN); or 2) clicking the “Call Me” option to receive an automated call directly to their phone.

    Related materials will be available on the Investor Centre section of TransAlta’s website at https://transalta.com/investors/presentations-and-events/. If you are unable to participate in the call, the replay will be accessible at https://edge.media-server.com/mmc/p/zd49obg6. A transcript of the broadcast will be posted on TransAlta’s website once it becomes available.

    Notes

    (1)These items (adjusted EBITDA, FCF and annual average EBITDA) are not defined and have no standardized meaning under IFRS. Presenting these items from period to period provides management and investors with the ability to evaluate earnings (loss) trends more readily in comparison with prior periods’ results. Please refer to the Non-IFRS Measures section of this earnings release for further discussion of these items, including, where applicable, reconciliations to measures calculated in accordance with IFRS.
    (2)Funds from operations (FFO) per share and free cash flow (FCF) per share are calculated using the weighted average number of common shares outstanding during the period. Refer to the Additional IFRS Measures and Non-IFRS Measures section of the MD&A for the purpose of these non-‍IFRS ratios.

    Non-IFRS financial measures and other specified financial measures

    We use a number of financial measures to evaluate our performance and the performance of our business segments, including measures and ratios that are presented on a non-IFRS basis, as described below. Unless otherwise indicated, all amounts are in Canadian dollars and have been derived from our consolidated financial statements prepared in accordance with IFRS. We believe that these non-IFRS amounts, measures and ratios, read together with our IFRS amounts, provide readers with a better understanding of how management assesses results.

    Non-IFRS amounts, measures and ratios do not have standardized meanings under IFRS. They are unlikely to be comparable to similar measures presented by other companies and should not be viewed in isolation from, as an alternative to, or more meaningful than, our IFRS results.

    Adjusted EBITDA

    Each business segment assumes responsibility for its operating results measured by adjusted EBITDA. Adjusted EBITDA is an important metric for management that represents our core operational results. Interest, taxes, depreciation and amortization are not included, as differences in accounting treatments may distort our core business results. In addition, certain reclassifications and adjustments are made to better assess results, excluding those items that may not be reflective of ongoing business performance. This presentation may facilitate the readers’ analysis of trends.

    Average Annual EBITDA

    Average annual EBITDA is a forward-looking non-IFRS financial measure that is used to show the average annual EBITDA that the project is expected to generate.

    Funds From Operations (FFO)

    FFO is an important metric as it provides a proxy for cash generated from operating activities before changes in working capital and provides the ability to evaluate cash flow trends in comparison with results from prior periods. FFO is a non-IFRS measure. The most directly comparable IFRS measure is Cash Flow from Operations.

    Free Cash Flow (FCF)

    FCF is an important metric as it represents the amount of cash that is available to invest in growth initiatives, make scheduled principal repayments on debt, repay maturing debt, pay common share dividends or repurchase common shares. Changes in working capital are excluded so FFO and FCF are not distorted by changes that we consider temporary in nature, reflecting, among other things, the impact of seasonal factors and timing of receipts and payments. FCF is a non-IFRS measure. The most directly comparable IFRS measure is Cash Flow from Operations.

    Non-IFRS Ratios

    FFO per share, FCF per share and adjusted net debt to adjusted EBITDA are non-IFRS ratios that are presented in the MD&A. Refer to the Reconciliation of Cash Flow from Operations to FFO and FCF and Key Non-IFRS Financial Ratios sections of the MD&A for additional information.

    FFO per share and FCF per share

    FFO per share and FCF per share are calculated using the weighted average number of common shares outstanding during the period. FFO per share and FCF per share are non-IFRS ratios.

    Reconciliation of these non-IFRS financial measures to the most comparable IFRS measure are provided below.

    Reconciliation of Non-IFRS Measures on a Consolidated Basis

    The following table reflects adjusted EBITDA by segment and provides reconciliation to earnings before income taxes for the three months ended Dec. 31, 2024:

    Three months ended Dec. 31, 2024
    $ millions
    Hydro   Wind & Solar(1)   Gas   Energy Transition   Energy
    Marketing
    Corporate   Total   Equity accounted investments(1)   Reclass adjustments   IFRS financials  
    Revenues 93   104   319   155   14   685   (7 )   678  
    Reclassifications and adjustments:                  
    Unrealized mark-to-market (gain) loss 4   23   26   (8 ) 19   64     (64 )  
    Realized gains (losses) on closed exchange positions     (1 ) 2   1   2     (2 )  
    Decrease in finance lease receivable   1   5       6     (6 )  
    Finance lease income   2   3       5     (5 )  
    Revenues from Planned Divestitures     (1 )     (1 )   1    
    Brazeau penalties (20 )         (20 )   20    
    Unrealized foreign exchange gain on commodity     (1 )     (1 )   1    
    Adjusted revenues 77   130   350   149   34   740   (7 ) (55 ) 678  
    Fuel and purchased power 3   8   136   102     249       249  
    Reclassifications and adjustments:                  
    Fuel and purchased power related to Planned Divestitures     (1 )     (1 )   1    
    Australian interest income     (1 )     (1 )   1    
    Adjusted fuel and purchased power 3   8   134   102     247     2   249  
    Carbon compliance     39       39       39  
    Gross margin 74   122   177   47   34   454   (7 ) (57 ) 390  
    OM&A 47   27   67   19   7 68   235   (1 )   234  
    Reclassifications and adjustments:                    
    Brazeau penalties (31 )         (31 )   31    
    ERP integration costs         (14 ) (14 )   14    
    Acquisition-related transaction and restructuring costs         (16 ) (16 )   16    
    Adjusted OM&A 16   27   67   19   7 38   174   (1 ) 61   234  
    Taxes, other than income taxes 1   3   4       8   1     9  
    Net other operating income   (3 ) (10 ) (9 )   (22 )     (22 )
    Reclassifications and adjustments:                    
    Sundance A decommissioning cost reimbursement       9     9     (9 )  
    Adjusted net other operating income   (3 ) (10 )     (13 )   (9 ) (22 )
    Adjusted EBITDA(2) 57   95   116   28   27 (38 ) 285        
    Equity income                   2  
    Finance lease income                   5  
    Depreciation and amortization                   (143 )
    Asset impairment charges                   (20 )
    Interest income                   11  
    Interest expense                   (92 )
    Foreign exchange gain                   17  
    Loss before income taxes                   (51 )

    (1)  The Skookumchuck wind facility has been included on a proportionate basis in the Wind and Solar segment.
    (2)  Adjusted EBITDA is not defined and has no standardized meaning under IFRS. Refer to the Non-IFRS financial measures and other specified financial measures section in this earnings release and may not be comparable to similar measures presented by other issuers.

    The following table reflects adjusted EBITDA by segment and provides reconciliation to loss before income taxes for the three months ended Dec. 31, 2023:

    Three months ended Dec. 31, 2023
    $ millions
    Hydro   Wind &
    Solar
    (1)
      Gas   Energy
    Transition
    Energy
    Marketing
      Corporate   Total   Equity
    accounted
    investments
    (1)
      Reclass
    adjustments
      IFRS
    financials
     
    Revenues 77   94   246   175 39     631   (7 )   624  
    Reclassifications and adjustments:                  
    Unrealized mark-to-market (gain) loss (2 ) 20   53   7 (19 )   59     (59 )  
    Realized gain on closed exchange positions     23   4     27     (27 )  
    Decrease in finance lease receivable     15       15     (15 )  
    Finance lease income     2       2     (2 )  
    Unrealized foreign exchange gain on commodity     1       1     (1 )  
    Adjusted revenues 75   114   340   182 24     735   (7 ) (104 ) 624  
    Fuel and purchased power 5   8   127   138     278       278  
    Reclassifications and adjustments:                  
    Australian interest income     (1 )     (1 )   1    
    Adjusted fuel and purchased power 5   8   126   138     277     1   278  
    Carbon compliance     27       27       27  
    Gross margin 70   106   187   44 24     431   (7 ) (105 ) 319  
    OM&A 13   25   56   18 10   29   151   (1 )   150  
    Taxes, other than income taxes 1   1       1   3       3  
    Net other operating income   (3 ) (10 )     (13 )     (13 )
    Adjusted net other operating income   (2 ) (10 )     (12 )   (1 ) (13 )
    Adjusted EBITDA(2) 56   82   141   26 14   (30 ) 289        
    Equity income                   3  
    Finance lease income                   2  
    Depreciation and amortization                   (132 )
    Asset impairment charges                   (26 )
    Interest income                   12  
    Interest expense                   (66 )
    Foreign exchange loss                   (7 )
    Loss before income taxes                   (35 )

    (1)  The Skookumchuck wind facility has been included on a proportionate basis in the Wind and Solar segment.
    (2)  Adjusted EBITDA is not defined and has no standardized meaning under IFRS. Refer to the Non-IFRS financial measures and other specified financial measures section in this earnings release and may not be comparable to similar measures presented by other issuers.

    The following table reflects adjusted EBITDA by segment and provides reconciliation to earnings before income taxes for the year ended Dec. 31, 2024:

    Year ended Dec. 31, 2024
    $ millions
    Hydro Wind &
    Solar
    (1)
      Gas   Energy
    Transition
      Energy
    Marketing
      Corporate   Total   Equity
    accounted
    investments
    (1)
      Reclass
    adjustments
      IFRS
    financials
     
    Revenues 409   357   1,350   616   168   (34 ) 2,866   (21 )   2,845  
    Reclassifications and adjustments:                  
    Unrealized mark-to-market (gain) loss 1   84   (60 ) (36 ) 14     3     (3 )  
    Realized gain (loss) on closed exchange positions     7   2   (15 )   (6 )   6    
    Decrease in finance lease receivable   2   19         21     (21 )  
    Finance lease income   6   8         14     (14 )  
    Revenues from Planned Divestitures     (1 )       (1 )   1    
    Brazeau penalty (20 )           (20 )   20    
    Unrealized foreign exchange loss on commodity     (2 )       (2 )   2    
    Adjusted revenues 390   449   1,321   582   167   (34 ) 2,875   (21 ) (9 ) 2,845  
    Fuel and purchased power 16   30   475   418       939       939  
    Reclassifications and adjustments:                  
    Fuel and purchased power related to Planned Divestitures     (1 )       (1 )   1    
    Australian interest income     (4 )       (4 )   4    
    Adjusted fuel and purchased power 16   30   470   418       934     5   939  
    Carbon compliance     145   1     (34 ) 112       112  
    Gross margin 374   419   706   163   167     1,829   (21 ) (14 ) 1,794  
    OM&A 86   97   198   69   36   173   659   (4 )   655  
    Reclassifications and adjustments:                    
    Brazeau penalty (31 )           (31 )   31    
    ERP implementation costs           (14 ) (14 )   14    
    Acquisition-related transaction and restructuring costs           (24 ) (24 )   24    
    Adjusted OM&A 55   97   198   69   36   135   590   (4 ) 69   655  
    Taxes, other than income taxes 3   16   13   3     1   36       36  
    Net other operating income   (10 ) (40 ) (9 )     (59 )     (59 )
    Reclassifications and adjustments:                    
    Sundance A decommissioning cost reimbursement       9       9     (9 )  
    Adjusted net other operating income   (10 ) (40 )       (50 )   (9 ) (59 )
    Adjusted EBITDA(2) 316   316   535   91   131   (136 ) 1,253        
    Equity income                   5  
    Finance lease income                   14  
    Depreciation and amortization                   (531 )
    Asset impairment charges                   (46 )
    Interest income                   30  
    Interest expense                   (324 )
    Foreign exchange gain                   5  
    Gain on sale of assets and other                   4  
    Earnings before income taxes                   319  

    (1)  The Skookumchuck wind facility has been included on a proportionate basis in the Wind and Solar segment.
    (2)  Adjusted EBITDA is not defined and has no standardized meaning under IFRS. Refer to the Non-IFRS financial measures and other specified financial measures section in this earnings release and may not be comparable to similar measures presented by other issuers.

    The following table reflects adjusted EBITDA by segment and provides reconciliation to earnings before income taxes for the year ended Dec. 31, 2023:

    Year ended Dec. 31, 2023
    $ millions
    Hydro   Wind &
    Solar
    (1)
      Gas   Energy
    Transition
      Energy
    Marketing
      Corporate   Total   Equity
    accounted
    investments
    (1)
      Reclass
    adjustments
      IFRS
    financials
     
    Revenues 533   357   1,514   751   220   1   3,376   (21 )   3,355  
    Reclassifications and adjustments:                  
    Unrealized mark-to-market loss (4 ) 16   (67 ) (5 ) 23     (37 )   37    
    Realized gain (loss) on closed exchange positions     10     (91 )   (81 )   81    
    Decrease in finance lease receivable     55         55     (55 )  
    Finance lease income     12         12     (12 )  
    Unrealized foreign exchange gain on commodity     1         1     (1 )  
    Adjusted revenues 529   373   1,525   746   152   1   3,326   (21 ) 50   3,355  
    Fuel and purchased power 19   30   453   557     1   1,060       1,060  
    Reclassifications and adjustments:                  
    Australian interest income     (4 )       (4 )   4    
    Adjusted fuel and purchased power 19   30   449   557     1   1,056     4   1,060  
    Carbon compliance     112         112       112  
    Gross margin 510   343   964   189   152     2,158   (21 ) 46   2,183  
    OM&A 48   80   192   64   43   115   542   (3 )   539  
    Taxes, other than income taxes 3   12   11   3     1   30   (1 )   29  
    Net other operating income   (7 ) (40 )       (47 )     (47 )
    Reclassifications and adjustments:                  
    Insurance recovery   1           1     (1 )  
    Adjusted net other operating income   (6 ) (40 )       (46 )   (1 ) (47 )
    Adjusted EBITDA(2) 459   257   801   122   109   (116 ) 1,632        
    Equity income                   4  
    Finance lease income                   12  
    Depreciation and amortization                   (621 )
    Asset impairment reversals                   48  
    Interest income                   59  
    Interest expense                   (281 )
    Foreign exchange gain                   (7 )
    Gain on sale of assets and other                   4  
    Earnings before income taxes                   880  

    (1)  The Skookumchuck wind facility has been included on a proportionate basis in the Wind and Solar segment.
    (2)  Adjusted EBITDA is not defined and has no standardized meaning under IFRS. Refer to the Non-IFRS financial measures and other specified financial measures section in this earnings release and may not be comparable to similar measures presented by other issuers.


    Reconciliation of cash flow from operations to FFO and FCF

    The table below reconciles our cash flow from operating activities to our FFO and FCF:

      Three Months Ended Year Ended
    $ millions, unless otherwise stated Dec. 31, 2024   Dec. 31, 2023   Dec. 31, 2024   Dec. 31, 2023  
    Cash flow from operating activities(1) 215   310   796   1,464  
    Change in non-cash operating working capital balances (97 ) (135 ) (38 ) (124 )
    Cash flow from operations before changes in working capital 118   175   758   1,340  
    Adjustments        
    Share of adjusted FFO from joint venture(1) 4   3   8   8  
    Decrease in finance lease receivable 6   15   21   55  
    Clean energy transition provisions and adjustments(2)   4     11  
    Sundance A decommissioning cost reimbursement (9 )   (9 )  
    Realized gain (loss) on closed exchanged positions 2   27   (6 ) (81 )
    Acquisition-related transaction and restructuring costs 11     19    
    Other(3) 5   5   19   18  
    FFO(4) 137   229   810   1,351  
    Deduct:        
    Sustaining capital(1) (67 ) (74 ) (142 ) (174 )
    Productivity capital (1 ) (1 ) (1 ) (3 )
    Dividends paid on preferred shares (13 ) (12 ) (52 ) (51 )
    Distributions paid to subsidiaries’ non-controlling interests (6 ) (19 ) (40 ) (223 )
    Principal payments on lease liabilities (3 ) (2 ) (6 ) (10 )
    Other 1        
    FCF(4) 48   121   569   890  
    Weighted average number of common shares outstanding in the period 298   308   302   276  
    FFO per share(4) 0.46   0.74   2.68   4.89  
    FCF per share(4) 0.16   0.39   1.88   3.22  

    (1)  Includes our share of amounts for the Skookumchuck wind facility, an equity-accounted joint venture.
    (2)  2023 includes amounts related to onerous contracts recognized in 2021 and a voluntary contribution to the US Defined Benefit Pension Plan for the Centralia thermal facility.
    (3)  Other consists of production tax credits, which is a reduction to tax equity debt, less distributions from an equity-accounted joint venture.
    (4)  These items are not defined and have no standardized meaning under IFRS and may not be comparable to similar measures presented by other issuers. Refer to the Non-IFRS Measures section in this earnings release .

    The table below provides a reconciliation of our adjusted EBITDA to our FFO and FCF:

      Three Months Ended Year Ended
    $ millions, unless otherwise stated Dec. 31, 2024   Dec. 31, 2023   Dec. 31, 2024   Dec. 31, 2023  
    Adjusted EBITDA(1)(4) 285   289   1,253   1,632  
    Provisions 2   (1 ) 10   (1 )
    Net interest expense(2) (64 ) (41 ) (231 ) (164 )
    Current income tax recovery (expense) (20 ) 5   (143 ) (50 )
    Realized foreign exchange gain (loss) (20 ) 9   (27 ) (4 )
    Decommissioning and restoration costs settled (12 ) (15 ) (41 ) (37 )
    Other non-cash items (34 ) (17 ) (11 ) (25 )
    FFO(3)(4) 137   229   810   1,351  
    Deduct:        
    Sustaining capital(4) (67 ) (74 ) (142 ) (174 )
    Productivity capital (1 ) (1 ) (1 ) (3 )
    Dividends paid on preferred shares (13 ) (12 ) (52 ) (51 )
    Distributions paid to subsidiaries’ non-controlling interests (6 ) (19 ) (40 ) (223 )
    Principal payments on lease liabilities (3 ) (2 ) (6 ) (10 )
    Other 1        
    FCF(4) 48   121   569   890  

    (1)  Adjusted EBITDA is defined in the Additional IFRS Measures and Non-IFRS Measures of this earnings release and reconciled to earnings (loss) before income taxes above.
    (2) Net interest expense includes interest expense less interest income and excludes non-cash items like financing amortization and accretion.
    (3)  These items are not defined and have no standardized meaning under IFRS and may not be comparable to similar measures presented by other issuers. FFO and FCF are defined in the Non-IFRS financial measures and other specified financial measures section of in this earnings release and reconciled to cash flow from operating activities above.
    (4)  Includes our share of amounts for Skookumchuck wind facility, an equity-accounted joint venture.

    TransAlta is in the process of filing its Annual Information Form, Audited Consolidated Financial Statements and accompanying notes, as well as the associated Management’s Discussion & Analysis (MD&A). These documents will be available today on the Investors section of TransAlta’s website at www.transalta.com or through SEDAR at www.sedarplus.ca.

    TransAlta will also be filing its Form 40-F with the US Securities and Exchange Commission. The form will be available through their website at www.sec.gov. Paper copies of all documents are available to shareholders free of charge upon request.

    About TransAlta Corporation:

    TransAlta owns, operates and develops a diverse fleet of electrical power generation assets in Canada, the United States and Western Australia with a focus on long-term shareholder value. TransAlta provides municipalities, medium and large industries, businesses and utility customers with clean, affordable, energy efficient and reliable power. Today, TransAlta is one of Canada’s largest producers of wind power and Alberta’s largest producer of hydro-electric power. For over 112 years, TransAlta has been a responsible operator and a proud member of the communities where we operate and where our employees work and live. TransAlta aligns its corporate goals with the UN Sustainable Development Goals and the Future-Fit Business Benchmark, which also defines sustainable goals for businesses. Our reporting on climate change management has been guided by the International Financial Reporting Standards (IFRS) S2 Climate-related Disclosures Standard and the Task Force on Climate-related Financial Disclosures (TCFD) recommendations. TransAlta has achieved a 70 per cent reduction in GHG emissions or 22.7 million tonnes CO2e since 2015 and received an upgraded MSCI ESG rating of AA.

    For more information about TransAlta, visit our web site at transalta.com.

    Cautionary Statement Regarding Forward-Looking Information

    This news release includes “forward-looking information,” within the meaning of applicable Canadian securities laws, and “forward-looking statements,” within the meaning of applicable United States securities laws, including the Private Securities Litigation Reform Act of 1995 (collectively referred to herein as “forward-looking statements”). Forward-looking statements are not facts, but only predictions and generally can be identified by the use of statements that include phrases such as “may”, “will”, “can”, “could”, “would”, “shall”, “believe”, “expect”, “estimate”, “anticipate”, “intend”, “plan”, “forecast”, “foresee”, “potential”, “enable”, “continue” or other comparable terminology. These statements are not guarantees of our future performance, events or results and are subject to risks, uncertainties and other important factors that could cause our actual performance, events or results to be materially different from those set out in or implied by the forward-looking statements. In particular, this news release contains forward-looking statements about the following, among other things: the strategic objectives of the Company and that the execution of the Company’s strategy will realize value for shareholders; our capital allocation and financing strategy; our sustainability goals and targets, including those in our 2024 Sustainability Report; our 2025 Outlook; our financial and operational performance, including our hedge position; optimizing and diversifying our existing assets; the increasingly contracted nature of our fleet; expectations about strategies for growth and expansion, including opportunities for Centralia redevelopment, and data centre opportunities; expected costs and schedules for planned projects; expected regulatory processes and outcomes, including in relation to the Alberta restructured energy market; the power generation industry and the supply and demand of electricity; the cyclicality of our business; expected outcomes with respect to legal proceedings; the expected impact of future tax and accounting changes; and expected industry, market and economic conditions.

    The forward-looking statements contained in this news release are based on many assumptions including, but not limited to, the following: no significant changes to applicable laws and regulations; no unexpected delays in obtaining required regulatory approvals; no material adverse impacts to investment and credit markets; no significant changes to power price and hedging assumptions; no significant changes to gas commodity price assumptions and transport costs; no significant changes to interest rates; no significant changes to the demand and growth of renewables generation; no significant changes to the integrity and reliability of our facilities; no significant changes to the Company’s debt and credit ratings; no unforeseen changes to economic and market conditions; and no significant event occurring outside the ordinary course of business.

    These assumptions are based on information currently available to TransAlta, including information obtained from third-party sources. Actual results may differ materially from those predicted. Factors that may adversely impact what is expressed or implied by forward-looking statements contained in this news release include, but are not limited to: fluctuations in power prices; changes in supply and demand for electricity; our ability to contract our electricity generation for prices that will provide expected returns; our ability to replace contracts as they expire; risks associated with development projects and acquisitions; any difficulty raising needed capital in the future on reasonable terms or at all; our ability to achieve our targets relating to ESG; long-term commitments on gas transportation capacity that may not be fully utilized over time; changes to the legislative, regulatory and political environments; environmental requirements and changes in, or liabilities under, these requirements; operational risks involving our facilities, including unplanned outages and equipment failure; disruptions in the transmission and distribution of electricity; reductions in production; impairments and/or writedowns of assets; adverse impacts on our information technology systems and our internal control systems, including increased cybersecurity threats; commodity risk management and energy trading risks; reduced labour availability and ability to continue to staff our operations and facilities; disruptions to our supply chains; climate-change related risks; reductions to our generating units’ relative efficiency or capacity factors; general economic risks, including deterioration of equity and debt markets, increasing interest rates or rising inflation; general domestic and international economic and political developments, including potential trade tariffs; industry risk and competition; counterparty credit risk; inadequacy or unavailability of insurance coverage; increases in the Company’s income taxes and any risk of reassessments; legal, regulatory and contractual disputes and proceedings involving the Company; reliance on key personnel; and labour relations matters.

    The foregoing risk factors, among others, are described in further detail under the heading “Governance and Risk Management” in the MD&A, which section is incorporated by reference herein.

    Readers are urged to consider these factors carefully when evaluating the forward-looking statements and are cautioned not to place undue reliance on them. The forward-looking statements included in this news release are made only as of the date hereof and we do not undertake to publicly update these forward-looking statements to reflect new information, future events or otherwise, except as required by applicable laws. The purpose of the financial outlooks contained herein is to give the reader information about management’s current expectations and plans and readers are cautioned that such information may not be appropriate for other purposes.

    Note: All financial figures are in Canadian dollars unless otherwise indicated.

    For more information:

    Investor Inquiries: Media Inquiries:
    Phone: 1-800-387-3598 in Canada and US Phone: 1-855-255-9184
    Email: investor_relations@transalta.com Email: ta_media_relations@transalta.com

    The MIL Network

  • MIL-OSI: Donegal Group Inc. Announces Fourth Quarter and Full Year 2024 Results

    Source: GlobeNewswire (MIL-OSI)

    MARIETTA, Pa., Feb. 20, 2025 (GLOBE NEWSWIRE) — Donegal Group Inc. (NASDAQ:DGICA) and (NASDAQ:DGICB) today reported its financial results for the fourth quarter and full year ended December 31, 2024.

    Significant items for fourth quarter of 2024 (all comparisons to fourth quarter of 2023):

    • Net premiums earned increased 4.6% to $236.6 million
    • Combined ratio of 92.9%, compared to 106.8%
    • Net income of $24.0 million, or 70 cents per diluted Class A share, compared to net loss of $2.0 million, or 6 cents per Class A share
    • Net investment gains (after tax) of $0.2 million, or 1 cent per diluted Class A share, compared to $1.8 million, or 5 cents per Class A share, are included in net income (loss)

    Significant items for full year of 2024 (all comparisons to full year of 2023):

    • Net premiums earned increased 6.2% to $936.7 million
    • Combined ratio of 98.6%, compared to 104.4%
    • Net income of $50.9 million, or $1.53 per diluted Class A share, compared to $4.4 million, or 14 cents per diluted Class A share
    • Net investment gains (after tax) of $3.9 million, or 12 cents per diluted Class A share, compared to $2.5 million, or 8 cents per diluted Class A share, are included in net income
    • Book value per share of $15.36 at December 31, 2024, compared to $14.39 at year-end 2023

    Financial Summary

      Three Months Ended December 31,     Year Ended December 31,  
      2024   2023   % Change     2024   2023   % Change  
      (dollars in thousands, except per share amounts)    
                               
    Income Statement Data                      
    Net premiums earned $   236,635   $   226,185   4.6 %   $   936,651   $   882,071   6.2 %
    Investment income, net 12,050   10,710   12.5     44,918   40,853   10.0  
    Net investment gains 256   2,243   -88.6     4,981   3,173   57.0  
    Total revenues 249,954   239,468   4.4     989,605   927,338   6.7  
    Net income (loss) 24,003   (1,970)   NM2     50,862   4,426   NM  
    Non-GAAP operating income (loss)1 23,801   (3,742)   NM     46,927   1,919   NM  
    Annualized return on average equity 18.1%   -1.7%   19.8 pts     9.9%   0.9%   9.0 pts  
                               
    Per Share Data                        
    Net income (loss) – Class A (diluted) $         0.70   $        (0.06)   NM     $         1.53   $         0.14   NM  
    Net income (loss) – Class B 0.64   (0.06)   NM     1.38   0.11   NM  
    Non-GAAP operating income (loss) – Class A (diluted) 0.69   (0.11)   NM     1.41   0.06   NM  
    Non-GAAP operating income (loss) – Class B 0.63   (0.11)   NM     1.27   0.04   NM  
    Book value 15.36   14.39   6.7 %   15.36   14.39   6.7 %
                               

    ¹The “Definitions of Non-GAAP Financial Measures” section of this release defines and reconciles data that we prepare on an accounting basis other than U.S. generally accepted accounting principles (“GAAP”).
    ²Not meaningful.

    Management Commentary

    Kevin G. Burke, President and Chief Executive Officer of Donegal Group Inc., stated, “We concluded 2024 with strong performance in the fourth quarter that we believe reflected our unrelenting focus in recent years on execution, whether on strategic initiatives to broaden our market capabilities or on profit-improvement measures to enhance our operating performance. As we move into 2025, we are striving to further enhance our performance while also pursuing intentional, strategic premium growth.

    “For the fourth quarter of 2024, our loss ratio improved substantially compared to the prior-year quarter, as premium rate increases contributed to higher net premiums earned and numerous underwriting initiatives we implemented in recent years resulted in lower claim activity. Our weather-related loss ratio compared favorably to both the prior-year quarter and our previous five-year average for the fourth quarter of the year. Net development of reserves for claims incurred in prior years had virtually no effect on the loss ratio for the fourth quarter of 2024 or 2023.

    “We effectively mitigated the higher costs associated with our major systems modernization project and higher underwriting-based incentive costs by implementing targeted expense-reduction strategies across our operations. We remain committed to refining the efficiency of our insurance operations, leveraging our substantial investments in technology, data and analytics, to maintain a sustainable expense ratio.”

    Mr. Burke concluded, “As the insurance industry landscape continues to evolve, our dedicated team will maintain focus on the effective execution of the strategies we believe will lead to successful achievement of our long-term objectives. We will continue to implement premium rate increases as needed to maintain rate adequacy and achieve targeted risk-adjusted returns. We are also actively pursuing new business opportunities across our regional footprint, concentrating primarily on high quality new commercial middle market and small business accounts, while also seeking strategic new business growth within our personal lines segment. We have refined our state-specific strategies and action plans to meet current market challenges and opportunities. We believe that the successful execution of those actions will allow us to further enhance underwriting performance, drive sustainable measured growth and strengthen our competitive position with our independent agents, ultimately increasing the value of our stockholders’ investment in Donegal Group Inc.”

    Insurance Operations

    Donegal Group is an insurance holding company whose insurance subsidiaries and affiliates offer property and casualty lines of insurance in three Mid-Atlantic states (Delaware, Maryland and Pennsylvania), five Southern states (Georgia, North Carolina, South Carolina, Tennessee and Virginia), eight Midwestern states (Illinois, Indiana, Iowa, Michigan, Nebraska, Ohio, South Dakota and Wisconsin) and five Southwestern states (Arizona, Colorado, New Mexico, Texas and Utah). Donegal Mutual Insurance Company and the insurance subsidiaries of Donegal Group conduct business together as the Donegal Insurance Group.

      Three Months Ended December 31,     Year Ended December 31,  
      2024   2023   % Change     2024   2023   % Change  
      (dollars in thousands)    
                               
    Net Premiums Earned                        
    Commercial lines $    136,701   $    133,602   2.3 %   $    539,683   $    533,029   1.2 %
    Personal lines        99,934          92,583   7.9          396,968        349,042   13.7  
    Total net premiums earned $    236,635   $    226,185   4.6 %   $    936,651   $    882,071   6.2 %
                               
    Net Premiums Written                      
    Commercial lines:                        
    Automobile $      42,922   $      39,888   7.6 %   $    184,989   $    174,741   5.9 %
    Workers’ compensation        20,934          22,283   -6.1          103,533        107,598   -3.8  
    Commercial multi-peril        50,431          48,010   5.0          213,959        195,632   9.4  
    Other          9,790          10,544   -7.2            45,439          50,458   -9.9  
    Total commercial lines      124,077        120,725   2.8          547,920        528,429   3.7  
    Personal lines:                        
    Automobile        54,078          54,609   -1.0          243,036        215,957   12.5  
    Homeowners        30,958          34,653   -10.7          140,613        139,688   0.7  
    Other          2,329            2,706   -13.9            10,712          11,623   -7.8  
    Total personal lines        87,365          91,968   -5.0          394,361        367,268   7.4  
    Total net premiums written $    211,442   $    212,693   -0.6%     $    942,281   $    895,697   5.2 %
                               


    Net Premiums Written

    The 0.6% decrease in net premiums written¹ for the fourth quarter of 2024 compared to the fourth quarter of 2023, as shown in the table above, represents the combination of 2.8% growth in commercial lines net premiums written and a 5.0% decrease in personal lines net premiums written. The $1.3 million decrease in net premiums written for the fourth quarter of 2024 compared to the fourth quarter of 2023 included:

    • Commercial Lines: $3.3 million increase that we attribute primarily to solid premium retention and a continuation of renewal premium increases in lines other than workers’ compensation, offset partially by planned attrition in classes of business we have targeted for profit improvement.
    • Personal Lines: $4.6 million decrease that we attribute primarily to planned attrition due to non-renewal actions and lower new business writings, offset partially by a continuation of renewal premium rate increases and solid policy retention.

    The $46.6 million increase in net premiums written for the full year of 2024 compared to the full year of 2023 included:

    • Commercial Lines: $19.5 million increase that we attribute primarily to strong premium retention and a continuation of renewal premium increases in lines other than workers’ compensation, offset partially by planned attrition in states we exited or classes of business we have targeted for profit improvement.
    • Personal Lines: $27.1 million increase that we attribute primarily to a continuation of renewal premium rate increases and solid policy retention, offset partially by planned attrition due to non-renewal actions and lower new business writings.

    Underwriting Performance

    We evaluate the performance of our commercial lines and personal lines segments primarily based upon the underwriting results of our insurance subsidiaries as determined under statutory accounting practices. The following table presents comparative details with respect to the GAAP and statutory combined ratios¹ for the three months and full years ended December 31, 2024 and 2023:

      Three Months Ended     Year Ended  
      December 31,     December 31,  
      2024     2023     2024     2023  
                           
    GAAP Combined Ratios (Total Lines)                
    Loss ratio – core losses 52.3 %   61.8 %   54.0 %   57.5 %
    Loss ratio – weather-related losses 3.3     5.9     7.2     8.3  
    Loss ratio – large fire losses 4.0     4.8     4.9     5.2  
    Loss ratio – net prior-year reserve development -0.2     -0.4     -1.6     -1.9  
    Loss ratio 59.8     72.1     64.5     69.1  
    Expense ratio 32.8     34.1     33.7     34.7  
    Dividend ratio 0.3     0.6     0.4     0.6  
    Combined ratio 92.9 %   106.8 %   98.6 %   104.4 %
                           
    Statutory Combined Ratios                  
    Commercial lines:                    
    Automobile 115.7 %   104.8 %   102.6 %   97.3 %
    Workers’ compensation 105.6     107.9     104.4     96.6  
    Commercial multi-peril 79.4     107.8     95.0     112.3  
    Other 84.7     95.0     80.0     85.5  
    Total commercial lines 97.3     105.8     98.2     101.6  
    Personal lines:                    
    Automobile 96.5     119.7     97.4     109.7  
    Homeowners 76.2     101.3     99.6     108.6  
    Other 106.3     59.2     99.5     75.8  
    Total personal lines 89.5     111.1     98.3     108.2  
    Total lines 94.0 %   107.8 %   98.3 %   104.2 %
                           

     
    Loss Ratio – Fourth Quarter

    For the fourth quarter of 2024, the loss ratio decreased to 59.8%, compared to 72.1% for the fourth quarter of 2023. The core loss ratio, which excludes weather-related losses, large fire losses and net development of reserves for losses incurred in prior accident years, was 52.3% for the fourth quarter of 2024, which improved significantly compared to 61.8% for the fourth quarter of 2023. For the commercial lines segment, the core loss ratio of 55.2% for the fourth quarter of 2024 improved from 59.6% for the fourth quarter of 2023, primarily as the result of ongoing premium rate increases in all lines except workers’ compensation and reduced exposures in underperforming states and classes of business. For the personal lines segment, the core loss ratio of 48.4% for the fourth quarter of 2024 decreased significantly from 65.1% for the fourth quarter of 2023, due largely to the favorable impact of premium rate increases on net premiums earned for that segment.

    Weather-related losses of $7.7 million, or 3.3 percentage points of the loss ratio, for the fourth quarter of 2024 decreased from $13.4 million, or 5.9 percentage points of the loss ratio, for the fourth quarter of 2023. Our insurance subsidiaries did not incur significant losses from any single weather event during the fourth quarters of 2024 or 2023. The impact of weather-related loss activity to the loss ratio for the fourth quarter of 2024 was lower than our previous five-year average of 5.2 percentage points for fourth quarter weather-related losses.

    Large fire losses, which we define as individual fire losses in excess of $50,000, were $9.5 million, or 4.0 percentage points of the loss ratio, for the fourth quarter of 2024, compared to $10.8 million, or 4.8 percentage points of the loss ratio, for the fourth quarter of 2023. The modest decrease primarily reflected lower average severity in homeowner fire losses.

    Net development of reserves for losses incurred in prior accident years had virtually no impact to the loss ratio for the fourth quarter of 2024 or 2023. For the fourth quarter of 2024, our insurance subsidiaries experienced unfavorable development primarily in personal automobile and commercial automobile losses that was offset by favorable development in commercial multi-peril losses and other lines of business. For the fourth quarter of 2023, our insurance subsidiaries experienced favorable development in personal automobile, workers’ compensation, homeowners and commercial automobile losses, offset partially by unfavorable development in commercial multi-peril and other commercial losses.

    Loss Ratio – Full Year

    For the full year of 2024, the loss ratio decreased to 64.5%, compared to 69.1% for the full year of 2023. The 2024 core loss ratio decreased by 3.5 percentage points to 54.0% from 57.5% for 2023. For the commercial lines segment, the core loss ratio of 54.4% for 2024 improved from 56.5% for 2023, primarily as the result of ongoing premium rate increases in all lines except workers’ compensation and reduced exposures in underperforming states and classes of business. For the personal lines segment, the core loss ratio of 53.5% for 2024 decreased from 59.1% in 2023, due largely to the favorable impact of premium rate increases on net premiums earned for that segment.

    Weather-related losses for the full year of 2024 were $67.7 million, or 7.2 percentage points of the loss ratio, compared to $72.9 million, or 8.3 percentage points of the loss ratio, for the full year of 2023. The loss ratio impact of weather-related losses for the full year of 2024 was in line with the previous five-year average of 7.0 percentage points of the loss ratio.

    Large fire losses were $45.8 million, or 4.9 percentage points of the loss ratio, for the full year of 2024, relatively in line with $45.4 million, or 5.2 percentage points of the loss ratio, for the full year of 2023.

    Net favorable development of reserves for losses incurred in prior accident years of $15.0 million reduced the loss ratio for the full year of 2024 by 1.6 percentage points. For the full year of 2024, our insurance subsidiaries experienced favorable development in losses primarily in the commercial multi-peril, personal automobile and homeowners lines of business, offset partially by unfavorable development in the workers’ compensation and commercial automobile lines of business. Net favorable development of reserves for losses incurred in prior accident years of $16.7 million reduced the loss ratio for the full year of 2023 by 1.9 percentage points. For the full year of 2023, our insurance subsidiaries experienced favorable development in losses primarily in the commercial automobile, personal automobile, workers’ compensation and homeowners lines of business.

    Expense Ratio

    The expense ratio was 32.8% for the fourth quarter of 2024, compared to 34.1% for the fourth quarter of 2023. The expense ratio was 33.7% for the full year of 2024, compared to 34.7% for the full year of 2023. The decrease in the expense ratios for the fourth quarter and full year of 2024 primarily reflected the impacts of various expense reduction initiatives, including agency incentive program revisions, commission schedule adjustments, targeted staffing reductions, and hiring restrictions for open employment positions, among others. These impacts were offset partially by an increase in underwriting-based incentive costs as well as higher technology systems-related expenses that were primarily due to increased costs related to our ongoing systems modernization project, a portion of which Donegal Mutual Insurance Company allocates to our insurance subsidiaries. We expect the impact from allocated costs from Donegal Mutual Insurance Company to our insurance subsidiaries related to the ongoing systems modernization project peaked at approximately 1.3 percentage points of the expense ratio for the full year of 2024 and will subside gradually in 2025 and subsequent years.

    Investment Operations

    Donegal Group’s investment strategy is to generate an appropriate amount of after-tax income on its invested assets while minimizing credit risk through investment in high-quality securities. As a result, we had invested 95.6% of our consolidated investment portfolio in diversified, highly rated and marketable fixed-maturity securities at December 31, 2024.

      December 31, 2024     December 31, 2023  
      Amount   %     Amount   %  
      (dollars in thousands)    
    Fixed maturities, at carrying value:                  
    U.S. Treasury securities and obligations of U.S.                  
    government corporations and agencies $    170,423   12.3 %   $    176,991   13.3 %
    Obligations of states and political subdivisions      409,560   29.5          415,280   31.3  
    Corporate securities      440,552   31.8          399,640   30.1  
    Mortgage-backed securities      304,459   22.0          278,260   21.0  
    Allowance for expected credit losses         (1,388 ) -0.1             (1,326 ) -0.1  
    Total fixed maturities   1,323,606   95.5       1,268,845   95.6  
    Equity securities, at fair value        36,808   2.7            25,903   2.0  
    Short-term investments, at cost        24,558   1.8            32,306   2.4  
    Total investments $ 1,384,972   100.0 %   $ 1,327,054   100.0 %
                       
    Average investment yield 3.3%         3.1%      
    Average tax-equivalent investment yield 3.4%         3.2%      
    Average fixed-maturity duration (years)              5.2                      4.3      
                       

    Net investment income of $12.1 million for the fourth quarter of 2024 increased 12.5% compared to $10.7 million in net investment income for the fourth quarter of 2023, due primarily to higher average invested assets and an increase in the average investment yield compared to the prior-year fourth quarter. Net investment income of $44.9 million for the full year of 2024 increased 10.0% compared to the full year of 2023, due primarily to higher average invested assets and an increase in the average investment yield compared to the prior year.

    Net investment gains were minimal for the fourth quarter of 2024, compared to $2.2 million for the fourth quarter of 2023. We attribute the gains to the quarterly increases in the market value of the equity securities held at the end of the respective periods.

    Net investment gains were $5.0 million for the full year of 2024, compared to $3.2 million for the full year of 2023. We attribute the gains to the change in the market value of the equity securities held at the end of the respective periods.

    Our book value per share was $15.36 at December 31, 2024, compared to $14.39 at December 31, 2023, as increases from net income and unrealized gains within our available-for-sale fixed-maturity portfolio during 2024 were partially offset by the dividends we declared during the year.

    Definitions of Non-GAAP Financial Measures

    We prepare our consolidated financial statements on the basis of GAAP. Our insurance subsidiaries also prepare financial statements based on statutory accounting principles state insurance regulators prescribe or permit (“SAP”). In addition to using GAAP-based performance measurements, we also utilize certain non-GAAP financial measures that we believe provide value in managing our business and for comparison to the financial results of our peers. These non-GAAP measures are net premiums written, operating income or loss and statutory combined ratio.

    Net premiums written and operating income or loss are non-GAAP financial measures investors in insurance companies commonly use. We define net premiums written as the amount of full-term premiums our insurance subsidiaries record for policies effective within a given period less premiums our insurance subsidiaries cede to reinsurers. We define operating income or loss as net income or loss excluding after-tax net investment gains or losses, after-tax restructuring charges and other significant non-recurring items. Because our calculation of operating income or loss may differ from similar measures other companies use, investors should exercise caution when comparing our measure of operating income or loss to the measure of other companies.

    The following table provides a reconciliation of net premiums earned to net premiums written for the periods indicated:

      Three Months Ended December 31,     Year Ended December 31,  
      2024   2023   % Change     2024   2023   % Change  
      (dollars in thousands)    
                               
    Reconciliation of Net Premiums                          
    Earned to Net Premiums Written                          
    Net premiums earned $       236,635   $     226,185   4.6 %   $     936,651   $     882,071   6.2 %
    Change in net unearned premiums          (25,193        (13,492 86.7               5,630           13,626   -58.7  
    Net premiums written $       211,442   $     212,693   -0.6   $     942,281   $     895,697   5.2 %
                               
                               

    The following table provides a reconciliation of net income (loss) to operating income (loss) for the periods indicated:

      Three Months Ended December 31,      Year Ended December 31,  
      2024   2023     % Change     2024   2023   % Change  
      (dollars in thousands, except per share amounts)    
                                 
    Reconciliation of Net Income (Loss)                            
    to Non-GAAP Operating Income (Loss)                            
    Net income (loss) $ 24,003   $ (1,970 )   NM     $ 50,862   $ 4,426   NM  
    Investment gains (after tax)   (202 )   (1,772 )   -88.6 %     (3,935 )   (2,507 ) 57.0 %
    Non-GAAP operating income (loss) $ 23,801   $ (3,742 )   NM     $ 46,927   $ 1,919   NM  
                                 
    Per Share Reconciliation of Net Income (Loss)                            
    to Non-GAAP Operating Income (Loss)                            
    Net income (loss) – Class A (diluted) $ 0.70   $ (0.06 )   NM     $ 1.53   $ 0.14   NM  
    Investment gains (after tax)   (0.01 )   (0.05 )   -80.0 %     (0.12 )   (0.08 ) 50.0 %
    Non-GAAP operating income (loss) – Class A $ 0.69   $ (0.11 )   NM     $ 1.41   $ 0.06   NM  
                                 
    Net income (loss) – Class B $ 0.64   $ (0.06 )   NM     $ 1.38   $ 0.11   NM  
    Investment gains (after tax)   (0.01 )   (0.05 )   -80.0 %     (0.11 )   (0.07 ) 57.1 %
    Non-GAAP operating income (loss) – Class B $ 0.63   $ (0.11 )   NM     $ 1.27   $ 0.04   NM  
                                 

    The statutory combined ratio is a standard non-GAAP measurement of underwriting profitability that is based upon amounts determined under SAP. The statutory combined ratio is the sum of:

    • the statutory loss ratio, which is the ratio of calendar-year incurred losses and loss expenses, excluding anticipated salvage and subrogation recoveries, to premiums earned;
    • the statutory expense ratio, which is the ratio of expenses incurred for net commissions, premium taxes and underwriting expenses to premiums written; and
    • the statutory dividend ratio, which is the ratio of dividends to holders of workers’ compensation policies to premiums earned.

    The statutory combined ratio does not reflect investment income, federal income taxes or other non-operating income or expense. A statutory combined ratio of less than 100% generally indicates underwriting profitability.

    Dividend Information

    On December 19, 2024, we declared regular quarterly cash dividends of $0.1725 per share for our Class A common stock and $0.155 per share for our Class B common stock, which we paid on February 18, 2025 to stockholders of record as of the close of business on February 4, 2025.

    Pre-Recorded Webcast

    At approximately 8:30 am EDT on Thursday, February 20, 2025, we will make available in the Investors section of our website a pre-recorded audio webcast featuring management commentary on our quarterly and annual results and general business updates. You may listen to the pre-recorded webcast by accessing the link on our website at http://investors.donegalgroup.com. A supplemental investor presentation is also available via our website.

    About the Company

    Donegal Group Inc. is an insurance holding company whose insurance subsidiaries and affiliates offer property and casualty lines of insurance in certain Mid-Atlantic, Midwestern, Southern and Southwestern states. Donegal Mutual Insurance Company and the insurance subsidiaries of Donegal Group Inc. conduct business together as the Donegal Insurance Group. The Donegal Insurance Group has an A.M. Best rating of A (Excellent).

    The Class A common stock and Class B common stock of Donegal Group Inc. trade on the NASDAQ Global Select Market under the symbols DGICA and DGICB, respectively. We are focused on several primary strategies, including achieving sustained excellent financial performance, strategically modernizing our operations and processes to transform our business, capitalizing on opportunities to grow profitably and providing superior experiences to our agents, policyholders and employees.

    Safe Harbor

    We base all statements contained in this release that are not historic facts on our current expectations. Such statements are forward-looking in nature (as defined in the Private Securities Litigation Reform Act of 1995) and necessarily involve risks and uncertainties. Forward-looking statements we make may be identified by our use of words such as “will,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “seek,” “estimate” and similar expressions. Our actual results could vary materially from our forward-looking statements. The factors that could cause our actual results to vary materially from the forward-looking statements we have previously made include, but are not limited to, adverse litigation and other trends that could increase our loss costs (including social inflation, labor shortages and escalating medical, automobile and property repair costs), adverse and catastrophic weather events (including from changing climate conditions), our ability to maintain profitable operations (including our ability to underwrite risks effectively and charge adequate premium rates), the adequacy of the loss and loss expense reserves of our insurance subsidiaries, the availability and successful operation of the information technology systems our insurance subsidiaries utilize, the successful development of new information technology systems to allow our insurance subsidiaries to compete effectively, business and economic conditions in the areas in which we and our insurance subsidiaries operate, interest rates, competition from various insurance and other financial businesses, terrorism, the availability and cost of reinsurance, legal and judicial developments (including those related to COVID-19 business interruption coverage exclusions), changes in regulatory requirements, our ability to attract and retain independent insurance agents, changes in our A.M. Best rating and the other risks that we describe from time to time in our filings with the Securities and Exchange Commission. We disclaim any obligation to update such statements or to announce publicly the results of any revisions that we may make to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.

    Investor Relations Contacts

    Karin Daly, Vice President, The Equity Group Inc.
    Phone: (212) 836-9623
    E-mail: kdaly@equityny.com

    Jeffrey D. Miller, Executive Vice President & Chief Financial Officer
    Phone: (717) 426-1931
    E-mail: investors@donegalgroup.com

    Financial Supplement

    Donegal Group Inc.  
    Consolidated Statements of Income (Loss)  
    (unaudited; in thousands, except share data)  
             
      Quarter Ended December 31,  
      2024   2023  
             
    Net premiums earned $ 236,635   $ 226,185  
    Investment income, net of expenses 12,050   10,710  
    Net investment gains 256   2,243  
    Lease income 77   85  
    Installment payment fees 936   245  
    Total revenues 249,954   239,468  
             
    Net losses and loss expenses 141,435   163,154  
    Amortization of deferred acquisition costs 39,853   39,149  
    Other underwriting expenses 37,649   38,032  
    Policyholder dividends 826   1,225  
    Interest 269   156  
    Other expenses, net 255   233  
    Total expenses 220,287   241,949  
             
    Income (loss) before income tax expense (benefit) 29,667   (2,481 )
    Income tax expense (benefit) 5,664   (511 )
             
    Net income (loss) $ 24,003   $ (1,970 )
             
    Net income (loss) per common share:        
    Class A – basic $ 0.71   $ (0.06 )
    Class A – diluted $ 0.70   $ (0.24 )
    Class B – basic and diluted $ 0.64   $ (0.06 )
             
    Supplementary Financial Analysts’ Data        
             
    Weighted-average number of shares        
    outstanding:        
    Class A – basic 28,979,432   27,702,646  
    Class A – diluted 29,224,696   27,726,318  
    Class B – basic and diluted 5,576,775   5,576,775  
             
    Net premiums written $ 211,442   $ 212,693  
             
    Book value per common share        
    at end of period $ 15.36   $ 14.39  
             
    Donegal Group Inc.
    Consolidated Statements of Income
    (unaudited; in thousands, except share data)
           
      Year Ended December 31,
      2024   2023
           
    Net premiums earned $          936,651   $          882,071
    Investment income, net of expenses              44,918                40,853
    Net investment gains                4,981                  3,173
    Lease income                   314                     347
    Installment payment fees                2,741                     894
    Total revenues            989,605              927,338
           
    Net losses and loss expenses            604,118              609,178
    Amortization of deferred acquisition costs            160,311              154,214
    Other underwriting expenses            155,254              151,748
    Policyholder dividends                4,073                  5,313
    Interest                   946                     620
    Other expenses, net                2,564                  1,201
    Total expenses            927,266              922,274
           
    Income before income tax expense              62,339                  5,064
    Income tax expense              11,477                     638
           
    Net income $            50,862   $              4,426
           
    Net income per common share:      
    Class A – basic and diluted $                1.53   $                0.14
    Class B – basic and diluted $                1.38   $                0.11
           
    Supplementary Financial Analysts’ Data      
           
    Weighted-average number of shares      
    outstanding:      
    Class A – basic       28,155,276         27,469,250
    Class A – diluted       28,245,356         27,562,785
    Class B – basic and diluted         5,576,775           5,576,775
           
    Net premiums written $          942,281   $          895,697
           
    Book value per common share      
    at end of period $              15.36   $              14.39
           
    Donegal Group Inc.
    Consolidated Balance Sheets
    (in thousands)
               
          December 31,   December 31,
          2024   2023
          (unaudited)    
               
    ASSETS      
    Investments:      
      Fixed maturities:      
        Held to maturity, at amortized cost $ 705,714   $ 679,497
        Available for sale, at fair value 617,892   589,348
      Equity securities, at fair value 36,808   25,903
      Short-term investments, at cost 24,558   32,306
        Total investments 1,384,972   1,327,054
    Cash   52,926   23,792
    Premiums receivable 181,107   179,592
    Reinsurance receivable 420,742   441,431
    Deferred policy acquisition costs 73,347   75,043
    Prepaid reinsurance premiums 176,162   168,724
    Other assets 46,776   50,658
        Total assets $ 2,336,032   $ 2,266,294
               
    LIABILITIES AND STOCKHOLDERS’ EQUITY          
    Liabilities:        
      Losses and loss expenses $ 1,120,985   $ 1,126,157
      Unearned premiums 612,476   599,411
      Accrued expenses 2,917   3,947
      Borrowings under lines of credit 35,000   35,000
      Other liabilities 18,878   22,034
        Total liabilities 1,790,256   1,786,549
    Stockholders’ equity:      
      Class A common stock 329   308
      Class B common stock 56   56
      Additional paid-in capital 369,680   335,694
      Accumulated other comprehensive loss (28,200)   (32,882)
      Retained earnings 245,137   217,795
      Treasury stock (41,226)   (41,226)
        Total stockholders’ equity 545,776   479,745
        Total liabilities and stockholders’ equity $ 2,336,032   $ 2,266,294
               

     

    The MIL Network

  • MIL-OSI Video: Open Forum: Protecting People from a Changing Climate | World Economic Forum Annual Meeting 2025

    Source: World Economic Forum (video statements)

    Climate change disproportionately displaces vulnerable populations with limited resources to adapt or relocate. Rising sea levels, extreme weather and environmental degradation force millions from their homes, worsening poverty and instability.

    How can communities mitigate climate impacts and build resilience to climate change?

    Speakers: William Marshall, Fatou Jeng, M. Sanjayan, Rosmarie Wydler-Wälti, Alicia Bárcena Ibarra, Johanna Hoffman

    The 55th Annual Meeting of the World Economic Forum will provide a crucial space to focus on the fundamental principles driving trust, including transparency, consistency and accountability.

    This Annual Meeting will welcome over 100 governments, all major international organizations, 1000 Forum’s Partners, as well as civil society leaders, experts, youth representatives, social entrepreneurs, and news outlets.

    The World Economic Forum is the International Organization for Public-Private Cooperation. The Forum engages the foremost political, business, cultural and other leaders of society to shape global, regional and industry agendas. We believe that progress happens by bringing together people from all walks of life who have the drive and the influence to make positive change.

    World Economic Forum Website ► http://www.weforum.org/
    Facebook ► https://www.facebook.com/worldeconomicforum/
    YouTube ► https://www.youtube.com/wef
    Instagram ► https://www.instagram.com/worldeconomicforum/
    X ► https://twitter.com/wef
    LinkedIn ► https://www.linkedin.com/company/world-economic-forum
    TikTok ► https://www.tiktok.com/@worldeconomicforum
    Flipboard ► https://flipboard.com/@WEF

    #Davos2025 #WorldEconomicForum #wef25

    https://www.youtube.com/watch?v=edXk8TYrKqQ

    MIL OSI Video

  • MIL-OSI USA: Speaker Johnson Delivers Keynote Address to Alliance for Responsible Citizenship Conference

    Source: United States House of Representatives – Representative Mike Johnson (LA-04)

    WASHINGTON — Yesterday, Speaker Johnson delivered the keynote address at the 2025 Alliance for Responsible Citizenship (ARC) global conference in London, England. Appearing remotely to the more than 4,000-person audience, Speaker Johnson warned against the threat of “soft despotism,” and encouraged leaders to “be prepared to steer their aims towards policies and mediating institutions that reduce government dominion over our lives and advance prosperity.”

    “The only way to reverse this trend into further technocratic tyranny is to recommit to our foundational principles and live them out. What made the West, and what made our nations great, must now guide us once again,” Speaker Johnson said.

    Watch Speaker Johnson’s full address here.

    Below are excerpts from the address:

    “Here in America, as you are all seeing, we’re in the midst of a great change. In our national election a few months ago, our people delivered truly a mandate to make our country great again and to restore common sense in our public policy. Here and elsewhere, the radical big government progressives pushed that pendulum too far and too aggressively to the left, and the people rose up and said, enough. And now that pendulum is beginning to swing back to the center, and we’ve been given a once-in-a-generation opportunity to demonstrate now to our nation and the new demographics of voters who have come into our Republican Party for the first time, that it really is our conservative policies that lead to human flourishing, because they’re better for individuals and families and communities, individual states, and our nation as a whole,” Speaker Johnson said

    “In America, we still believe in peace through strength, and we still understand our role in the world. A strong America is good for free people everywhere because it helps to keep the terrorists and the tyrants at bay. But to maintain our strength and leadership, our foreign policy must be centered on our own national interest. It’s a matter of common sense for each of our countries to acknowledge that we must each take care of our own houses before we help take care of the neighborhood,” Speaker Johnson said. “As we seek to make America safer, stronger, and more prosperous, we will encourage all our friends and allies to do the same in and for their own countries. The survival of the West will depend upon that. And this is how we will turn the tides, by refocusing and marshalling our many shared interests toward our own national interest.”

    “This trend is reflected in political apathy and the growing tendency of people to simply submit to governments whose laws have become so offensively intrusive and whose centers of power feel distant and inaccessible. If there is nothing to fight for, then why fight at all, Speaker Johnson said. ”This is the vision of the left, for the people to feel so powerless that they give in and just accept their fate as mindless vassals under the safe protection of the state. And the only way to reverse this trend into further technocratic tyranny is to recommit to our foundational principles and live them out. What made the West and what made our nations great must now guide us once again.

    Below is the full transcript of Speaker Johnson’s address as delivered: 

    Thank you, my dear friend, the Baroness. Good morning. I wish I could be there with all of you in person, and I am truly sorry that I’ve been prevented from making the trip now for the second year in a row. I was unexpectedly elected Speaker of the House just days before the inaugural ARC Conference in October 2023, and I had to send my last-minute regrets. And now, just days before this second conference that I had so much been looking forward to, I found myself once again with late breaking developments in Congress, this time involving our budget and government funding that simply doesn’t allow me to leave the country. But there’s no place I’d rather be than there with you this week as we had long planned, but I’m glad to at least have this opportunity to join you remotely. 

    We find ourselves in a very unique and consequential moment in history here in America and throughout the West. And I believe the timing of the ARC Conference is truly providential. I joined the ARC Advisory Board two years ago because I was so intrigued by the idea of bringing together so many thought leaders and change makers from around the world to, as we determined, ‘shape a hope-filled vision for the future.’ My friends, there really is great reason for our hope. 

    Here in America, as you are all seeing, we’re in the midst of a great change. In our national election a few months ago, our people delivered truly a mandate to make our country great again and to restore common sense in our public policy. Here and elsewhere, the radical big government progressives pushed that pendulum too far and too aggressively to the left, and the people rose up and said, enough. And now that pendulum is beginning to swing back to the center, and we’ve been given a once-in-a-generation opportunity to demonstrate now to our nation and the new demographics of voters who have come into our Republican Party for the first time, that it really is our conservative policies that lead to human flourishing, because they’re better for individuals and families and communities, individual states, and our nation as a whole.

    In recent decades, our government had become too large, too inefficient, and too powerful. And in too many cases, it had also been weaponized and corrupted. That is precisely what the framers of our Constitution feared and what political philosophers and historians over the centuries have warned against. Almost two centuries ago, Alexei de Tocqueville wrote of big government: “After having thus successfully taken each member of the community in its powerful grasp and fashioned him at will, the supreme power then extends its arm over the whole community. It covers the surface of society with a network of small, complicated rules, minute and uniform, which the most original minds and the most energetic characters cannot penetrate to rise above the crowd.”

    De Tocqueville noted that “such a power does not tyrannize, but it compresses, extinguishes, and stupefies a people till each nation is reduced to nothing better than a flock of timid and industrious animals of which the government is the shepherd.” Tocqueville called it soft despotism, a condition in which citizens voluntarily and gradually just surrender their rights and independence to the government, lured by the promise of security and stability. This kind of despotism doesn’t arrive through violence or open tyranny. Instead, it comes quietly, insidiously, through comfort and convenience. 

    Tocqueville warned of a future where citizens would become passive spectators in their own democracy, willful stewards of their carefully managed decline. Soft despots don’t break down your door and confiscate your weapons, they don’t arrest you in public for criticizing the government, and they don’t station soldiers on street corners to ensure your compliance. Soft despots ensure your compliance through normal democratic channels. 

    Regulations? Oh, they keep you safe. 

    Censorship? That’s to protect you from misinformation. 

    Surveillance? That’s necessary for your security, see.

    Dependence? It offers you stability. 

    And we see these forces at work in our society today. The architects of this soft despotism have taken shape too often as government bureaucrats and big tech and corporate elites, international institutions, media gatekeepers, and the welfare state. And their benevolent rule has given us nations without borders, grossly inefficient bureaucracies, a culture of surveillance, and a citizenry that is apathetic, distracted, and dependent. The dynamics are the same around the world. Whether you’re in Detroit or Manchester, Lyon or Berlin, the supreme power of big government has extended its arm over all of us. And the casualties of the soft despotism that’s taken hold have been the loss of our heritage, our national identities, our patriotism, and our prosperity. 

    In this civilizational moment, as our friend Oz Guinness describes it, will we choose renewal, replacement, or decline? In the U.S., we have just embarked on a new path of renewal. We are determined to bring about a new golden age in America, as President Trump says, and we are convinced that we can, if we return to the timeless foundational principles which lead to human flourishing. 

    The challenge we have today is ensuring that the current generations of our countrymen recognize and recommit to those principles. And what are they? In less than 17 months, the U.S. will celebrate the 250th anniversary of our Declaration of Independence. As G.K. Chesterton observed, “America was founded on a creed that is set forth with dogmatic and even theological lucidity,” he said. From. the second paragraph of the Declaration, “We hold these truths to be self-evident, that all men are created equal, they are endowed by their Creator with certain inalienable rights, that among these are life, liberty, and the pursuit of happiness, that to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed.”

    Of the 56 men who signed the Declaration, almost all of them professed to be Christians, and at least half of them had received formal religious training in their education. Having studied the Bible, they recognize that we are not simply born equal, but rather created equal and that it is our Creator who endows us with our rights and not the state. They also recognize that all of us are made in the image of our Creator and thus every single person has an inestimable dignity and value. And that value is not related in any way to the color of our skin or where we live or what our talents are or anything else. Our value is inherent because it is given to us by God. 

    The founders of our country also understood that man has a fallen nature and that fallen men with power and no accountability can become a serious problem. Because power corrupts and as Lord Acton observed, “absolute power corrupts absolutely.” So, our system of government was meticulously designed with careful safeguards, like the separation of powers and checks and balances. And our founders emphasized that a government of the people, by the people, and for the people, could not long survive without a vibrant practice of religious faith, because they understood that is a necessary element to foster personal responsibility and to keep a general moral consensus among the people. A healthy, self-governing society relies on the moral character of its citizens. 

    It’s ironic, but on this day in America, we’re observing one of our 11 federal holidays, and this one’s known as President’s Day, which originally began as an annual celebration of George Washington’s birthday. In his farewell address, the father of our country noted this. He said, “Of all the dispositions and habits which lead to political prosperity, religion and morality are indispensable supports.” Our second president, John Adams, reminded his countrymen that the American Constitution was, “made only for a moral and religious people. It is wholly inadequate to the government of any other.” The founders emphasized the importance of balancing individual liberty with personal responsibility. And our fourth president, James Madison, argued that every citizen should put the nation above their own self-interest. 

    The timeless virtues that are rooted in the Judeo-Christian tradition served as the foundation of America and of all Western civilization. But in recent decades, changes have happened rapidly, and left-wing social movements have advanced very aggressively. Many world leaders, convinced that national borders were obstacles to unity and social progress, sought to dismantle them in favor of global integration. 

    But a key downside to the new global order is that it ultimately led to a devaluing of local communities and a weakening of national identity, which was replaced instead by a divisive new racial, sexual, and gender-based identity. If Americans aren’t American anymore, and Brits aren’t British anymore, and Germans aren’t German anymore, then naturally something else will fill the void. If everyone is a citizen of the world, then no one is really accountable any longer to their own nation or to their own local community. 

    Unfortunately, these ideas have taken hold. We have heard a little bit about polls this morning. Here’s a few more. 50% of Germans under the age of 30 say they feel more European now than German. Only 40% of Americans say they are extremely proud to be American. Only one in five British adults consider themselves to be very patriotic. This trend is reflected in political apathy and the growing tendency of people to simply submit to governments whose laws have become so offensively intrusive and whose centers of power feel distant and inaccessible. If there is nothing to fight for, then why fight at all? 

    This is the vision of the left, for the people to feel so powerless that they give in and just accept their fate as mindless vassals under the safe protection of the state. And the only way to reverse this trend into further technocratic tyranny is to recommit to our foundational principles and live them out. What made the West and what made our nations great must now guide us once again. 

    During his trip through America, Tocqueville marveled at what he said was, “The extreme skill with which the inhabitants of the United States succeed in proposing a common object for the exertions of a great many men and in inducing them voluntarily to pursue it.” Those neighbors and local volunteers joined together to found seminaries, hospitals, prisons, libraries, and schools. They built society together with their own hands. 

    In all of our shared history in the West, it has remained true that strong communities have formed a bulwark against tyranny. Strong mediating institutions ground us in the needs of our community and the outgrowth of these institutions formed the basis for a healthy, engaged citizenry. Edmund Burke called them “little platoons.” He was referring to the families and churches and civic organizations and community groups which began at the smallest, most local level. Burke argued this bottom-up voluntary approach to society would deepen our sense of duty and shared responsibility to one another and also act as an important safeguard against a distant state authority. 

    While the spirit of voluntary association is currently on life support throughout the West, it is not dead. We see it in America every time there is a natural disaster. I’ve participated in this as a local citizen, and I’ve witnessed it often as an elected official.

    This past September, Hurricane Helene made landfall in the United States. It was an historic storm. For five straight days, torrential rains and 100-mile-per-hour winds swept across the Atlantic, devastating homes and communities and businesses. It hit western North Carolina the hardest. As the Speaker of the House, tasked with ultimately passing the relief efforts through Congress, I wanted to take a trip to ground zero to witness the scope of this destruction and meet with the individuals whose aid our aid would eventually impact. 

    One of our first visits in the state was to the First Baptist Church in Swannanoa, North Carolina. When we arrived, we were met with what looked like a military-grade aid station. It was so impressive. There were doctors and nurses and carpenters and chefs and scores of volunteers. The storm knocked out almost all of their cell and internet service throughout the entire region. So, I asked the pastor’s wife at that church, how did all this come together? 

    She informed me that an elderly woman in the community, who had recently purchased an entire cow to store in her deep freezer for the winter months, had lost her home in the storm, but somehow the deep freezer had survived. She was worried that the hundreds of pounds of meat in her freezer would spoil without electricity, so she loaded it into a vehicle and dropped it off somewhere she knew it would go to good use, and that was the local church. 

    Neither the pastor nor his wife were trained butchers, but they knew they had hungry mouths in the community, so they turned their sanctuary into a makeshift butcher shop and started cooking for the surrounding people. As the smell of grilled beef wafted above the small town, citizens showed up. And they continued to show up. And from that point forward, the church became the central hub for disaster relief, organized not by the state or the federal government, but by local neighbors, the community. It filled in where the bureaucracy could not. 

    In times of disaster, local organizations are often the first to respond, well before the broken and bureaucratic federal agencies ever arrive. And they often have a much higher mission success rate, by the way. In my home state of Louisiana, organizations like the Cajun Navy, an interconnected group of volunteers with boats and trucks, have saved thousands of Louisianians during storms like Hurricane Katrina. 

    I tell these stories because they serve as evidence that strong communities, built on the spirit of voluntary association and shared responsibility are still very much alive. But it is a shame that it takes a natural disaster for us to recognize their value. This level of civic engagement should be the rule and not the exception, because the same principles that drive effective local action in times of crisis can also inform national policy and global leadership. 

    In the last line of the Declaration of Independence, our founders wrote the following, “For the support of this declaration, with a firm reliance on the protection of divine providence, we mutually pledge to each other our lives, our fortunes, and our sacred honor.” America’s founders were willing to die for the cause of liberty, and this acknowledgment in our nation’s birth certificate signaled a commitment that America would place our national interest over our individual interests, and those of foreign nations. 

    While we have gradually lost sight of this concept, the new American government is proof positive that we can rekindle that spirit once again. On this national holiday of ours, I’ll quote the president that I most fondly remember from my youth, and that’s Ronald Reagan. He reminded us of this famous admonition. He said, “We cannot escape our destiny, nor should we try to do so. The leadership of the free world was thrust upon us two centuries ago in that little hall in Philadelphia. In the days following World War II, when the economic strength and power of America was all that stood between the world and the return of the Dark Ages, Pope Pius XII said, the American people have a great genius for splendid and unselfish actions. 

    Into the hands of America, God has placed the destinies of an afflicted mankind.” American leadership clearly did help bring about decades of peace and economic growth and prosperity for the Western democracies. 

    In America, we still believe in peace through strength, and we still understand our role in the world. A strong America is good for free people everywhere because it helps to keep the terrorists and the tyrants at bay. But to maintain our strength and leadership, our foreign policy must be centered on our own national interest. It’s a matter of common sense for each of our countries to acknowledge that we must each take care of our own houses before we help take care of the neighborhood. As we seek to make America safer, stronger, and more prosperous, we will encourage all our friends and allies to do the same in and for their own countries. The survival of the West will depend upon that. And this is how we will turn the tides, by refocusing and marshalling our many shared interests toward our own national interest. 

    Recent elections in places France, Italy, like Netherlands and Germany signal that millions of freedom-loving people around the world share our concerns about unchecked power and the erosion of national sovereignty. As leaders in government, academia, media, and the arts, we must be prepared to steer their aims toward policies and mediating institutions that reduce government dominion over our lives and advance prosperity. In short, we must not let this civilizational moment pass us by. 

    So how do we do it? As leaders, we should be working at every level to shift control away from established power centers and back to the people. The local school board will not be nearly as powerful if there is a thriving parent-teacher association holding them accountable. The county commission’s grip on zoning laws is weakened when neighborhoods take control of development initiatives. And organizations like the World Economic Forum lose their dominance when organizations like our ARC seek to challenge their hegemony. 

    History has proven that centralized governments thrive when their subjects are powerless and indifferent. If we want to protect our rights from tyranny, we have to focus, work, and build closest to home. And we must hold our elected leaders accountable. 

    President Reagan reminded us of another thing. He said, “Freedom is never more than one generation away from extinction. We didn’t pass it to our children in the bloodstream. It must be fought for, protected, and handed on so that they will know the same liberty, opportunity, and security that we have too often taken for granted.”

    This is our civilizational moment. The West is finally awakening once again. We have to seize this opportunity, and by God’s grace, we will. I hope you all enjoy this historic conference, and I thank you again for the opportunity to share with you this morning, and I so wish I was there in person. God bless you.

    ###

    MIL OSI USA News

  • MIL-OSI USA: Case Reintroduces Measures To Halt Potentially Destructive Deep-Seabed Mining

    Source: United States House of Representatives – Congressman Ed Case (Hawai‘i – District 1)

    (Washington, DC) – U.S. Congressman Ed Case (HI-01) has reintroduced two measures in the 119th Congress (2025-2027) calling for moratoria on the mining of our world’s deep seabed unless and until its potentially destructive consequences are fully understood and an appropriate international protective regulatory regime is established.

    “Our deep oceans and seabed are the last unexplored regions of our world, yet what we do know of them is that they are among our most intricate and fragile,” said Congressman Case.

    “Over half of all known coral species are found in the deep sea, and as many as 10 million marine species may inhabit the deep sea, a massive and interrelated biodiversity seen nearly nowhere else on the planet.”

    Joining Case as co-sponsors of the measures are Members of Congress Jared Huffman (D-CA-02), the ranking member (senior Democrat) of the House Natural Resources Committee, Suzanne Bonamici (D-OR-01), Chellie Pingree (D-ME-1), Rashida Tlaib (D-MI-12), and Eleanor Holmes Norton (D-DC).

    “Mining in pristine, fragile ecosystems like the seabed could open a Pandora’s box of unintended consequences, ranging from decimating fish and marine mammal populations to destroying ecosystems and inhibiting carbon sequestration,” said Congressman Huffman.

    “Extracting industries should not have carte blanche access to what are some of the last untouched places on our planet. I’m glad to join Rep. Case in these bills to prevent the exploitation of seabeds before the proper research and regulations can be established.”

    “Deep sea mining poses significant risks. It has the potential to disrupt delicate ocean chemistry, harm deep sea life, and increase ocean acidification,” said Congresswoman Bonamici. “I’m grateful to partner with Congressman Case on this moratorium to protect the ocean ecosystem from exploitation.”

    “Deep sea mining can devastate our marine habitats and the species that live there, as well as negatively impact our climate,” said Congresswoman Norton.  “I’m proud to join Congressman Case in supporting legislation to pause our deep-sea mining activity pending further study and ensure we do not sign off on any harmful deep sea mining activities abroad.”

    Case continued: “Some of these species have had surprising benefits to humanity, including enzymes from one microbe found in deep-sea hydrothermal vents being used to develop COVID-19 tests. In addition, the deep ocean is one of our planet’s largest and most important stores of carbon and could play a critical role in the fight against climate change.”

    Among the deep-seabed mining areas most sought after by the industry for immediate unregulated mining is the Clarion-Clipperton Zone, an abyssal plain as wide as the continental United States punctuated by seamounts which extends to just hundreds of miles southeast of Hawai‘i Island. Yet little if anything material is known about the marine ecosystem of this area or its connection to Hawaii’s own unique marine and related ecosystem.

    “The marine life and natural processes not only of this zone but of our world’s oceans, and their relationships to our international ecosystems in terms of biodiversity, weather and other macro-environmental interdependencies, are in all likelihood imperiled by the imminent commencement of large-scale unregulated commercial seabed mining operations,” said Case. “Seabed mining could take a number of destructive forms, including methods which would shear off seamounts on the ocean floor, the functional equivalent of strip mining.”

    Case said the American Seabed Protection Act will place a moratorium on deep-sea mining activities in American waters or by American companies on the high seas. It also tasks the National Oceanic and Atmospheric Administration and the National Academies of Science with conducting a comprehensive assessment of how mining activities could affect ocean species, carbon sequestration processes and communities that rely on the ocean.

    The International Seabed Protection Act will require the United States to oppose international and other national seabed mining efforts until the President certifies that the International Seabed Authority has adopted a suitable regulatory framework which will guarantee protection for these unique ecosystems and the communities that rely on them.

    The introduction of the measures comes as the International Seabed Authority considers regulations that could open the international seabed for mining.  While both companies and countries are lining up to secure mining permits, many are concerned about the impact on marine ecosystems, habitats and communities.

    “The more we learn about the deep ocean, the more we understand its essential connections to the health of the entire ocean and to the climate,” said Addie Haughey, Earthjustice Legislative Director for Lands, Wildlife and Oceans.

    “Some mining industry interests would unleash unproven technology in sensitive and still unknown deep ocean ecosystems that belong to all of us. This gamble with the ocean, with a dubious rate of return economically, is not worth it. We support this legislation and appreciate Rep. Case’s vital leadership on this important effort.”

    The bills are also endorsed by the Benioff Ocean Science Lab, the Deep Sea Conservation Coalition, Earthworks, Marine Conservation Institute, Blue Climate Initiative – Tetiaroa Society and the Natural Resources Defense Council.

    Case summarized: “Paired together, these bills will establish the United States as an international leader in protecting our precious oceans through a responsible process to address the potentially devastating effects of

    Attachments:

    ·         Text for the American Seabed Protection Act is here.

    ·         Text for the International Seabed Protection Act is here.

    ·         Text of Case remarks on the measures is here.

    ###

    MIL OSI USA News

  • MIL-OSI Global: Why the US return to tariffs and protectionism ‘reeks of hypocrisy’ – podcast

    Source: The Conversation – UK – By Gemma Ware, Host, The Conversation Weekly Podcast, The Conversation

    Amani A/Shutterstock

     When Donald Trump imposed sweeping tariffs during his first term as US president, it sparked a trade war with China. As the Trump administration ratchets up its threat to tax imports from its allies and economic rivals alike, the world is bracing for another wave of costly economic disruption.

    This protectionist shift is all the more remarkable given how the US championed trade liberalisation for decades.

    So what does it actually take for a country to use protectionism to grow its economy? Some developing countries have successfully used tariffs to do so, while others have struggled. In this episode of The Conversation Weekly podcast, we talk to Jostein Hauge, a development economist at the University of Cambridge, about who wins and who loses from tariffs and protectionism.

    The main argument against taxing imports through tariffs is that the higher costs of imported goods will be passed onto consumers. The main argument in favour is that tariffs can help to protect a country’s domestic economy, explains Hauge:

     By using tariffs, you can, if they are used effectively, and if they’re successful, help domestic firms become better at producing what they’re producing and eventually become competitive in the world economy. Sometimes that’s successful, other times that’s not successful. It can also be an effective way of raising taxes, especially for countries that don’t have a lot of tax revenue, especially developing countries.

    A number of developing countries successfully used tariffs and other forms of protectionism to grow their economies in the 1950s and 1960s, as Hauge explains:

    South Korea gradually went from being a low-income, low-tech economy towards becoming extremely important players in global industries like electronics, automotive and steel.

    The US has also used tariffs throughout its history, with varying degrees of success. It was the most protectionist country in the world in the 1800s, using tariffs to grow its economy. But the Smoot-Hawley Act in 1930, which introduced a range of taxes on imports to the US, actually contributed to worsening the Great Depression.

    From the 1970s, however, the US aggressively pushed for trade liberalisation and backed the creation of the World Trade Organization in the 1990s. That’s why Hauge says the current return to US protectionism, which began during the first Trump administration and continued under Biden, “reeks of hypocrisy”.

     When rich countries were ahead in the 1970s, 1980s and 1990s, it made sense for them to preach the virtues of free trade to the rest of the world.  That is also why we’re seeing this protectionist turn right now, especially in the United States, but also to some degree in Europe, because now certain countries are starting to become competitive once again. In particular, China is now challenging the economic power of the United States, especially within a lot of manufactured goods, so the United States is now turning away from this doctrine of free trade, saying actually protectionism is useful.

    Listen to the conversation with Jostein Hauge on The Conversation Weekly podcast, which also includes an introduction from Tracy Walsh, economy and business editor at The Conversation US.


    This episode of The Conversation Weekly was written and produced by Mend Mariwany with assistance from Katie Flood and Gemma Ware, Sound design was by Michelle Macklem, and theme music by Neeta Sarl.

    Clips in this episode from CNN, Bloomberg Television, BBC News, CBS News and NBC News.

    Listen to The Conversation Weekly via any of the apps listed above, download it directly via our RSS feed or find out how else to listen here.

    Jostein Hauge does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

    ref. Why the US return to tariffs and protectionism ‘reeks of hypocrisy’ – podcast – https://theconversation.com/why-the-us-return-to-tariffs-and-protectionism-reeks-of-hypocrisy-podcast-250329

    MIL OSI – Global Reports