POWERFUL SERVICES. SUSTAINABLE SOLUTIONS - 2020 ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) REPORT
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POWERFUL SERVICES. SUSTAINABLE SOLUTIONS. 2 0 2 0 E N V I R O N M E N TA L , SOCIAL AND GOVERNANCE (ESG) REPORT
OVERVIEW 1 Mission, Vision & Values 2 Letter From Steve Tritch - Chairman of the Board of Directors 3 Letter From Scott Sewell - President and CEO 5 ESG At A Glance SOCIAL 23 Our People 26 Diversity And Inclusion 28 2021 Diversity And Inclusion Goals 29 Health And Wellness 30 Safety Leadership 34 2021 Safety Goals 35 Employee Experience Survey ENVIRONMENTAL 9 Environmental Sustainability Services 36 Charah Solutions Is Career Forward GOVERNANCE 37 Our Communities 43 Governance 11 Sustainability. It’s What We Do. 38 Recognition 47 Sustainability Accounting Standards 15 Efficiency-Driven Cost Savings Board (SASB) Index 17 The Future Of Our Business 54 Appendix A: 2021 ESG Goals 19 Environmental Compliance 57 Appendix B: UN Sustainable Development Goals (SDGs) 20 2021 Environmental Goals 20 2021 Data Acquisition And Reporting Capabilities Goals CONTENTS 2 3
LETTER from Stephen Tritch | Chairman of the Board of Directors MISSION Charah Solutions is a total solutions company providing unparalleled The Charah Solutions Board We believe that our outstanding ESG track record is one is excited to present to you of our greatest assets. As a leading provider of mission- service and innovation. our first annual Environmental, critical environmental services and byproduct sales to Social and Governance (ESG) Report to showcase the power generation industry for over 30 years, Charah our Company’s significant milestones in fulfilling our Solutions is dedicated to preserving natural resources in an VISION ESG commitments and sustainably preserving our natural resources for the betterment of our planet, our environmentally-conscious manner. As a result, we want to make sure that our impressive story is told so that our Charah Solutions is and will continue to be the leader in customer service, communities, and our customers. customers, partners, employees, and investors can clearly see all the data behind the highly positive environmental and social safety and innovation. We do this by hiring and developing great talent and Sustainability is what we do. It is who we are. Charah impact that Charah Solutions and our people are delivering. Solutions is truly one of America’s best examples working together to challenge and inspire each other to be the very best. of resource conservation and recovery through the As the Board Chair, I am delighted with the way our corporate beneficial recycling of coal ash, ash impoundment leadership, led by President and CEO Scott Sewell and CFO and closure services, and the remediation and redevelopment Treasurer Roger Shannon, has assembled a high-performance, VALUES of land for community and commercial use. cross-functional team to lead our formal sustainability program and ESG reporting effort. This reporting demonstrates our Today, the importance of sustainability has never been commitment to environmental stewardship, employee wellbeing, We focus daily on the following core values: greater or more widely respected. ESG is increasingly corporate diversity, and strong governance. With members a priority of both companies and institutional investors Customer Exceed Expectations driven by the growing interest of consumers, employees, from finance, HR, operations, IT, legal, communications, investor relations, environmental compliance, and safety, the ESG policymakers, and supply chain partners to assess the Leadership Team brings a balanced perspective as it evaluates Safety Never Compromise commitment to ESG initiatives at the company with key issues affecting both our Company performance and the which they work with and invest. unbiased reporting of our ESG data. Innovation Rethink Routine, Identify New Solutions Dedication to environmental responsibility, investing Our ESG actions and goals are the blueprints for achieving a in our employees, and giving back to the community Sustainability Take Responsibility And Take Action have been key value drivers at Charah Solutions since cleaner environment and a more sustainable future. As this first annual ESG Report illustrates, we are committed to taking its founding. The arrival of COVID-19 has underscored Teamwork Accountable To Each Other the importance of our dedication to safety and taking a leadership stance that investors recognize for value creation, that our partners recognize for aligning with their sustainability every precaution necessary to ensure our employees' goals, and that our employees recognize for creating a great Integrity Always Do The Right Thing continued wellbeing. These are the values that we live place to work. every day, so we welcome the ever-growing significance of ESG values in measuring corporate performance throughout the industry. Stephen Tritch Chairman of the Board of Directors Charah Solutions, Inc. 1 OVERVIEW 2
LETTER from Scott Sewell | President and CEO Sustainability has never Our recovery of coal ash enables environmental recycling, In this ESG Report, we focus on the real differences ur commitment to employees with a work environment O been more vitally important as this coal ash is beneficially used in the production of we are making, with key performance metrics that are characterized by considerate treatment of others, open and than it is today to both concrete to satisfy the growing infrastructure demands that relevant business drivers and value creators for our honest communication, personal accountability, trust, and companies and investors who utilize millions of tons of coal ash every year, thus preserving business while enhancing the environment. Our actions mutual respect to provide superior service and sustainable share a growing focus on natural resources while dramatically reducing the need for and efforts have produced ESG results that highlight this solutions for our customers. ESG in evaluating corporate landfill space. The beneficial recycling of ash in concrete value creation: ur commitment to diversity in the workforce has grown O performance. We are pleased to communicate the full production replaces Portland cement, a significant contributor ur proven sustainability efforts conserve virgin O even stronger, and we have implemented specific diversity story of Charah Solutions’ outstanding environmental to CO2 emissions, thus significantly decreasing CO2 and other resources and water, reduce greenhouse gases, initiatives and programs to accelerate this growth for leadership in this inaugural ESG Report. Together, greenhouse gases that would otherwise be emitted into and decrease landfill disposal, all while recycling and minorities and women at all levels of the Company. Charah Solutions’ management and employees are the atmosphere. Substituting recycled ash to make “Green providing essential byproducts that contribute to the united in our firm commitment to environmental Concrete” also makes it a stronger product for use in bridges, ur Safety Record is all about making sure that our people O growth of our national economy. responsibility, and we demonstrate that commitment highways, and buildings. get home in the same physical condition as they came to daily. As a leading provider of mission-critical ur use of recycled ash in structural fill projects O work in the morning. In 2020, we accomplished a remarkable We are an industry leader in quality, safety, and compliance, and environmental remediation and compliance services, in which we return the land to the community for 0.36 Total Recordable Incident Rate (TRIR) with no lost time we are committed to reducing greenhouse gas emissions and byproduct sales, fossil services and Environmental recreational or commercial use allows thousands of or restricted time injuries in comparison to the most recent preserving our environment for a cleaner energy future. This is Risk Transfer (ERT) services to the power generation acres of land to be reclaimed each year. Recordable Incident Rate industry average of 3.1. what we do at Charah Solutions. We live it. We breathe it. And industry, practicing environmental responsibility, ur beneficial use of 2.58 million tons of coal O ur concern for the wellbeing of our communities is genuine, O the purpose of this ESG Report is to demonstrate just that. At investing in employees, and serving our communities combustion residuals (CCRs), including fly ash and as demonstrated by the number of community and charitable Charah Solutions, we know that ESG matters. are all part of our mission. ESG reporting gives us the other supplementary cementitious materials (SCMs) organizations that our Company and employees support. opportunity to share our story and demonstrate the Our cross-functional ESG Leadership Team has worked in concrete and other products not only eliminates the intensively to gather the measurement data captured from our Going forward, we will continue integrating ESG values into the sustainability commitment that we practice daily on the need to dispose of fly ash in landfills but also reduces field activities to demonstrate our high level of commitment Company’s strategy at every level, and we will continue to set job to our customers, partners, and shareholders. the overall carbon footprint and conserves our virgin to environmental and community responsibility and employee trackable goals to keep improving. For most companies, sustainability is a byproduct of natural resources by substituting materials that would wellbeing. This ESG Report presents an incredible track record that we are what they do. At Charah Solutions, sustainability is typically be mined. We have chosen to structure our ESG Report using the justifiably proud of. And yet, we have only begun this journey. integral to what we do and who we are. Our work, ur innovative industry-leading EnviroSource™ O respected and accepted guidelines of the internationally There is no finish line. mission, and Company culture are directly aligned beneficiation technology (formerly MP618®) improves with providing the powerful services and sustainable recognized Sustainability Accounting Standards Board (SASB) fly ash quality so that significantly more tons of fly solutions to solve the power industry’s most complex and UN Sustainable Development Goals (SDGs) due to continued ash can be recycled and marketed for reuse. This environmental challenges. investor focus on acquiring better ESG reporting and better technology significantly reduces the environmental data. The importance of our ESG ranking, and the underlying With the new administration kickstarting its tenure by carbon footprint created by Portland cement and ESG data, is meaningful as it provides our customers, Scott Sewell placing climate action at the top of its priority list with provides a superior product at lower costs for ready shareholders, and potential investors with additional information President multiple executive orders including rejoining the Paris mix concrete producers. Chief Executive Officer that can impact decisions. Charah Solutions, Inc. Climate agreement, and by committing to 100% clean electricity by 2035, we expect to see a steady change in the American electric power sector in the immediate future with increased focus on coal ash remediation that provides significant business opportunities for our core service offerings, including remediation services and byproduct recycling, and will positively impact future growth. 3 OVERVIEW 4
E S G AT A G L A N C E 0.36 TOTAL RECORDABLE INCIDENT RATE 10% DIVERSE WORKFORCE 12.45 MILLION 2.24 MILLION (INDUSTRY AVERAGE IS 3.1) TONS OF CCRs HANDLED TONS OF CO2 SAVED FROM A THREE-YEAR AVERAGE 3.8% EXPERIENCE MODIFICATION ENTERING THE ATMOSPHERE MILITARY VETERAN WORKFORCE RATE (EMR) OF 2.58 MILLION LESS THAN 0.7 49 EMPLOYEES WITH TONS OF CCRs 2.58 MILLION 10 OR MORE BENEFICIATED AND RECYCLED TONS OF MATERIALS DIVERTED FROM LANDFILL DISPOSAL ZERO YEARS OF LOST TIME SENIORITY 34,215 TONS OR RESTRICTED TIME INJURIES OF GYPSUM RECYCLED 10,400 SAFETY OVER $780,000 IN CHARITABLE DOLLARS DONATED INSPECTIONS OVER THE LAST 5 YEARS 12 PONDS PERFORMED; 524,000 SAFETY CLEANED AND OBSERVATIONS PERFORMED; 261 COMPLIANCE AUDITS; 344 FINDINGS 12 CHARITABLE ORGANIZATIONS CLOSED AND 1 ZERO SUPPORTED MINE RECLAIMED INCIDENTS SINCE THE EPA 2015 CCR RULE 17 EMPLOYEES PROVIDED TOOK EFFECT OF NON-COMPLIANCE ASSOCIATED WITH APPROXIMATELY AIR EMISSIONS AND OF NON-COMPLIANCE WITH GRANTS OTHER ENVIRONMENTAL THROUGH CHARAH CARES PROGRAM 300 ACRES DISCIPLINES OF LAND RECLAIMED SINCE THE EPA AMERICAN RED CROSS BLOOD DRIVES 2015 CCR RULE TOOK EFFECT 60 DONORS 53 UNITS *CO2 savings are generated for lifecycle GHG calculations using the EPA WARM Model: MTCO2e = Metric Tonnes of CO2e Greenhouse Gas (GHG); EPA WARM Model evaluates total 42.34 MILLION COLLECTED GALLONS OF WASTEWATER TREATED 159 POTENTIAL lifecycle of GHG rather than site specific GHG calculations. Lifecycle GHG values are typically greater than those of site-specific activities; The EPA WARM model was ran using default settings. LIVES SAVED 5 OVERVIEW 6
E N V I R O N M E N TA L S U STA I N A B I L I T Y S E R V I C E S ASH POND MANAGEMENT Charah Solutions manages the design, construction, operation, Sustainability is central to everything we do at and remediation of onsite ash ponds to enable the safe and compliant beneficial use of these byproduct materials. Charah Solutions. Our core business is centered Coal ash is generated by burning coal in the boiler furnace, which creates bottom ash. The on coal ash byproduct management, the beneficial ash then goes into the electrostatic precipitator recycling of ash products, and environmental remediation and compliance. We develop innovative POWER PLANT or fabric filter which creates fly ash; then into the flue gas desulfurization (FGD) creating gypsum - all byproducts which are managed by sustainable solutions to complex environmental Charah Solutions and can be beneficially used issues for the betterment of the planet and the creating a sustainable process. communities in which we operate. BENEFICIATED ASH – ENVIROSOURCE™ CONDITIONED FLY ASH FOR STRUCTURAL FILL REMEDIATED POND LAND REUSE REDUCES BENEFICIAL USE of CCPs Fly Ash Ready Fly Ash Ponded Ash Bottom Ash Mix Concrete Structural Fill Kiln Feed Cinder Block GREENHOUSE GAS EMISSIONS Charah Solutions manages the coal combustion products (CCPs) including fly ash, bottom ash, conditioned ash, ponded ash, and gypsum, DECREASES LANDFILL CONSERVES AND which are collected and beneficially used in Upon ash pond closure by removal of the ash pond, the DISPOSAL PROTECTS WATER products for multiple industries. By beneficially Conditioned Gypsum Oil Gypsum land is remediated and redeveloped for community use, using more than 2.58 million tons of ash and Ash Kiln Feed Drywall Wells Fertilizer renewable energy, agricultural, commercial, or other supplementary cementitious materials (SCMs) industrial redevelopment opportunities. each year, we dramatically reduce greenhouse Pond ash is beneficiated using Charah Solutions Charah Solutions manages the design, gas emissions and the amount of waste sent proprietary EnviroSource™ fly ash beneficiation construction, and operation of structural to landfills. technology which uses a thermal process to fill projects in which the land is reclaimed reduce the loss on ignition (LOI) of the ash making and used for community or business use. CONSERVES VIRGIN REMEDIATES LAND formerly unusable fly ash stored in ponds and RESOURCES FOR USE WE BENEFICIALLY RECYCLED MORE THAN landfills immediately marketable to be beneficially 2.58 MILLION TONS OF CCPs IN 2020 used in the production of concrete. WE SAVED 2.24 MILLION TONS OF CO2 POWER PLANT DECOMMISSIONING AND DEMOLITION FROM ENTERING THE ATMOSPHERE IN 2020 Through our Environmental Risk Transfer (ERT) services DRY FLY ASH FOR READY CONDITIONED FLY ASH FOR GYPSUM FOR GYPSUM FOR MIX CONCRETE STRUCTURAL FILL DRY WALL AG FERTILIZER we take full ownership of decommissioned power plants and land from the utility. We demolish the power plant BUILD PARKS, GREEN SPACES, NATURAL and recycle the steel and other metals. HABITATS, AND COMMERCIAL SPACES. The land is also fully remediated and redeveloped for use which includes community use, renewable energy, agricultural, commercial, or other industrial Since 2015, Charah Solutions has reclaimed redevelopment opportunities. approximately 300 acres of land for community use. Charah Solutions fly ash improves concrete durability, strength, mixability, and finish. This concrete is used to build infrastructure to keep the economy moving. RECYCLED STEEL LAND REMEDIATION/ FOR INDUSTRIAL USE REDEVELOPMENT Class C and Class F Charah Solutions Raw gypsum byproduct Raw gypsum IN 2020, CHARAH SOLUTIONS fly ash is transported manages the design, is sold to dry wall byproduct is sold to DIVERTED 2.58 MILLION TONS OF via truck, barge, or rail construction, and manufacturing plants growers where it is Upon demolition of the power plant the land is MATERIAL FROM LANDFILLS. to ready mix concrete operation of structural where it is beneficially beneficially used as remediated and redeveloped for community use, producers where it is fill projects in which the used in residential agriculture fertilizer renewable energy, agricultural, commercial, or other beneficially used by mixing land is reclaimed and and commercial to enhance soil health industrial redevelopment opportunities. with other ingredients to used for community or construction projects. and improve plant produce concrete. business use. nutrition. Steel from the demolished plant and other facilities is collected and recycled where it is then beneficially used FOR EVERY TON OF FLY ASH USED TO to produce products for the automotive, construction, furniture, and other industries. REPLACE TRADITIONAL CEMENT, .87 TONS OF CO2 IS SAVED FROM ENTERING THE ATMOSPHERE 9 ENVIRONMENTAL 10
S U STA I N A B I L I T Y. I T ' S W H AT W E D O . Sustainability is central to everything we do at There are over 1,000 ash ponds and landfills in the U.S. Charah Solutions. Our core business is centered requiring Environmental Protection Agency (EPA) mandated on coal ash byproduct management, the beneficial closures or remediation. Utilities across the country face recycling of ash products, and environmental growing state legislation that is increasingly prescriptive in remediation and compliance. We develop innovative regulation mandates with timing expectations that extend sustainable solutions to complex environmental beyond the scope of EPA guidance. We see this as a clear Increased investment in our issues for the betterment of the planet and the opportunity to do the right thing for the environment and nation’s vital infrastructure On an annual basis, our communities in which we operate. In fact, our our communities by fully remediating these impoundments is driving increased demand for fly ash and other SCMs purpose for being in business is to practice sound and recycling as much of the ash as possible to reuse the beneficial use of ash critically needed to produce concrete. Concrete producers Environmental, Social and Governance as we land and protect our waterways. SAVES OVER nationwide need the improved concrete performance provide mission-critical environmental services and byproduct sales to the power generation The fly ash that we manage and beneficially use on behalf 2.24 MILLION TONS provided by adding recycled fly ash and other SCMs to their cement mixes. In doing so, concrete not only lasts industry. Our sustainability efforts conserve virgin of power companies would otherwise be a waste product OF CO2 FROM longer, is more durable and better performing, but also is that would need to be disposed of, turning what could resources and water, reduce greenhouse gases, become healthy lands into wastelands, and that would result ENTERING THE more sustainable, eliminating ash that would otherwise be and decrease landfill disposal, all while providing in continually adding tons of CO2 into the environment due ATMOSPHERE. stored in landfills or ponds. essential recycled-products that contribute to the to the manufacture of Portland cement. Fortunately, Charah growth of our economy and land remediation for Solutions provides a sustainable solution. the community. By recycling more than 2.58 million tons of ash and other supplementary cementitious materials (SCMs) as well as over 34,000 tons of gypsum each year, The United Nations Sustainable Development Goals we dramatically reduce the amount of waste sent to (SDGs) are the blueprint to achieve a better and more landfills. We beneficially recycle gypsum to produce sustainable future for all. These goals address global challenges, including poverty, inequality, climate change, drywall and recycle ash into environmentally-sound environmental degradation, peace and justice. The structural fill projects where we return thousands of Our reuse of CCR materials saves nature of our services, our core values, and our ESG commitments align with many of the UN SDGs. We acres of land to the community for recreational or enough landfill space annually to commercial use. Since the 2015 CCR Rule issued by are proud that our Company and our employees are making a daily impact in each of the UN SDGs outlined the EPA took effect, we’ve reclaimed approximately OFFSET THE WASTE throughout this ESG Report. 300 acres of land. GENERATED BY America needs new infrastructure, but not at the NEW YORK CITY expense of the environment. Our efforts ensure that AND BOSTON infrastructure built with concrete will not tax the environment or the concrete producers but rather FOR 200 DAYS. enhance the environment by decreasing our carbon THERE ARE MORE THAN 1.5B TONS OF COAL ASH STORED footprint and providing a higher standard product at IN 1,000+ ASH PONDS & LANDFILLS a lower cost than using virgin materials. You will hear more and more about “Green Concrete,” which is REQUIRING EPA-MANDATED REMEDIATION. produced from recycled ash. 11 ENVIRONMENTAL 12
Our MultiSource® Materials Network with over 40 locations nationwide ensures quality fly ash supplies for beneficial use by concrete and cement producers. Turning Carbon Into Cash Per the EPA WARM model, for every ton of fly ash used to replace traditional cement, 0.87 tons of CO2 is saved from entering the atmosphere. And when utilities think of contracting with Charah Solutions to sell fly ash to concrete producers instead of disposing of it, they think of EnviroSource™ Ash Beneficiation Technology savings for their customers. They can turn their carbon byproducts into cash. What is even more impressive about our work in the beneficial use of fly ash is the innovative ways we Approximately 25 million tons of ash byproducts are raising the quality of fly ash so that a far greater are used annually in the U.S. These recycled, percentage of it reaches the quality standards required for beneficial use materials contribute to the long- use in concrete and cement production. Our proprietary term durability of concrete used in America’s It is also important to note that better EnviroSource (formerly MP618®) fly ash technology network of roads, bridges, and infrastructure access to quality fly ash is a significant beneficiates ash – making formerly unusable fly ash while also preserving virgin raw materials and factor in its usage by concrete and cement stored in ponds or landfills immediately marketable, resources. In fact, more states are now requiring producers. If they can’t get access to the fly ash reducing the need for landfills, ponds, or other disposal With a proven track record of performance, it is not the substitution of fly ash as a replacement for they need, they can’t use it in their production, and methods. Through this proprietary technology, we will surprising that Charah Solutions is the partner of choice traditional cement. the ash has to be placed into landfills. At Charah significantly increase the tonnage of fly ash used in for solving power generation industry customers’ most Solutions, we have solved the problem of accessibility concrete production while vastly decreasing the use of complex environmental challenges and as an industry through our MultiSource materials network, a unique natural resources. This technology will leader in quality, safety, and compliance. distribution system of nearly 40 nationwide locations help our power industry customers with international sourcing and distribution, serving across the nation as they address the ready mix concrete producers, cement producers, more than 1,000 regulatorily-mandated Don’t just build a better and other materials customers. The MultiSource surface impoundment closures resulting infrastructure, network has grown to become an important strategic from tightening federal and state advantage of Charah Solutions and one that benefits BUILD A BETTER environmental regulations. the environment. For utilities, it helps keep their fly ENVIRONMENT. ash moving more efficiently for faster sales and marketing and keeps it out of landfills, and materials customers count on it for a consistently reliable supply of high-quality SCMs when and where they need it. 13 ENVIRONMENTAL 14
E F F I C I E N CY - D R I V E N C O ST SAV I N G S Environmental Risk Transfer Services Big Synergies And Big Savings Charah Solutions is also an industry leader in A recent example of our ERT services in action is As part of this agreement, Charah Solutions, providing Environmental Risk Transfer (ERT) seen in our agreement with the Texas Municipal through its subsidiary Gibbons Creek Environmental services. Through our ERT services, we provide Power Agency (TMPA) for the acquisition, remediation Redevelopment Group, LLC (GCERG), took ownership innovative solutions to large-scale, complex and redevelopment of Gibbons Creek Steam Electric of the 6,166-acre area, including the closed power environmental issues facing utilities. With the Station and Reservoir in Grimes County Texas. station, the 3,500-acre reservoir, dam, and spillway. growing shutdown of coal-fired power plants Charah Solutions is providing turnkey ERT services GCERG assumed responsibility for the demolition around the country, many utilities have an increased to remediate existing ash ponds and landfills and of the coal power plant as well as performing need to retire and decommission older generating redevelop the property after the coal plant was shut all environmental remediation work for the site assets while minimizing their costs and improving down and decommissioned in 2018 after operating landfills and ash ponds and providing redevelopment the environment in the process. These large- since 1982. opportunities for renewable energy, agricultural, scale projects typically involve shutting down, commercial, or industrial redevelopment while decommissioning and demolishing the existing creating jobs. coal-fired power plant, remediating onsite ash ponds and landfills, and restoring the land. Charah Solutions’ ERT services provide a custom, environmentally-friendly approach to these large- scale projects, which removes the liability from the “Our Environmental Risk Transfer utility through the acquisition of the property. Charah services represent an innovative “The transaction will save member cities millions in Solutions provides environmental remediation of solution for many utilities that need expenses associated with decommissioning and the ash ponds and landfills to meet all local, state and federal regulations, recycles the steel and other to retire and decommission older or environmentally remediating the plant site.” metals through the demolition of the plant and other facilities on the property, and redevelops the less economically viable generating property upon project completion for public use. assets while minimizing costs, Bob Kahn The redevelopment of the property typically includes TMPA General Manager natural habitat restoration for marine and other maximizing the value of the assets, wildlife. The ash from remediated ponds and landfills and improving the environment.” is also beneficially recycled in the production of “Green Concrete.” This ERT approach not only benefits the environment Scott Sewell but also provides economic benefits as it creates Charah Solutions President local professional and trade jobs, contributes to local and CEO business activity, supports the tax base, and lowers the costs for the utility and its ratepayers. Few companies can combine the environmental expertise and the financial scale to provide utilities with Environmental Risk Transfer services, but this turnkey service pays big dividends for the environment as well as for the power companies and the ratepayers who no longer have to support these older, inefficient plants financially. 15 ENVIRONMENTAL 16
THE FUTURE OF OUR BUSINESS As we build our strategic 5-year and 10-year plans Increased demand for our Environmental Risk Transfer Under a scenario where the life of existing coal-fired Increased demand for our proprietary EnviroSource fly for the future of our business, we believe Charah (ERT) services where we provide innovative turnkey power plants in the U.S. remains on track with today’s ash beneficiation technology as many state and local Solutions is well-positioned to continue to thrive solutions for these large-scale, complex environmental estimates of steady shutdowns over the next 20 to regulations are mandating that a percentage of the ash in under multiple scenarios for the future of coal- projects, including the acquisition of the property, 30 years or these lifecycles are extended beyond pond and landfill closure projects be recycled. fired power plants. While the long-term future of shutdown, decommissioning, and demolishing of the current predictions, Charah Solutions is well-positioned nder this scenario our strategic planning and the needs U coal-fired power plants remains to be seen, it will coal-fired power plant, remediation of the onsite ash for increased business and revenue opportunities for our services play out much like we have seen our likely change with new government administrations ponds and landfills, and restoration of the land. A with a steady stream of large scale pond and landfill business unfold in the last 12 to 18 months. Namely, and state and local regulations as well as with a typical ERT project is 2 to 5 years in duration. remediation, ERT, and byproduct sales projects increased demand for our broad platform of services better understanding of how extreme weather given regulatorily-mandated surface impoundment Increased demand for remediation of the more than due to the need for utilities to meet federal and state affects a future “green grid” over the next 10 to 20 remediation needs as well as the ongoing need for our 1,000 regulatorily-mandated surface impoundments in environmental regulations across the U.S. drives the needs years. However, whether coal-fired power plants ash management services. In this scenario, a larger the U.S., accelerating our business growth vs. current of electric utilities for larger and more complex remediation are rapidly decommissioned or their lifecycles portion of the overall services we provide to our utility expectations. solutions, with increased size and scope of projects. are extended beyond current predictions, Charah partners will be in play for a more extended period, Solutions’ services will continue to be in high A much-needed influx for the byproducts and fly ash leading to increased business including: It is also important to note that there are over 6,000 coal- demand and will most likely be needed even more we market to concrete and cement producers around fired power plants in operation outside of the U.S., over n uptick in the need for our ERT services as A in the future than currently projected, serving our the country today for beneficial use in the production 350 currently under construction outside of the U.S., and plants will be decommissioned over this 20 to utility partners for many years to come. of Portland cement and “Green Concrete,” as there is another 1,000+ outside of the U.S. that have been permitted 30 year period. currently a shortage in the market today. for construction. Charah Solutions’ leadership and expertise Under the scenario where the approximately 241 n ongoing stream of additional business in the A as a provider of environmental remediation and compliance currently existing coal-fired power plants in the U.S. An increase in the amount of reclaimed ponded ash marketing of byproduct and SCMs sales as plants services and byproduct sales to the power generation are decommissioned at a rapid rate over the next that we could recycle and market to cement kiln feed remain open for the predicted or longer time. industry makes us well-positioned to expand our services 10 to 15 years for those that are planning to close, producers. outside of the U.S. and to take advantage of these markets the shutdown of these plants and the remediation An increase in the amount of gypsum that we where coal-fired power plants are expanding. required at the federal EPA and local and state could handle and beneficially market to drywall levels would mean a decrease in our overall routine manufacturers. ash management opportunities but would provide An increase in the amount of conditioned ash that for a significant increase in demand for many of would be immediately available for use in large scale our other services. Including: structural fill projects where the land is reclaimed and used for community or business use. Immediate accelerated demand for our proprietary EnviroSource fly ash beneficiation technology, which makes unusable fly ash stored in ponds or landfills immediately marketable. As many state and local regulations are mandating that a percentage of the ash in pond and landfill closure projects has to be beneficially used, this would provide many years of ongoing ash beneficiation projects and would create a 10 to 15 year supply of Class C and Class F fly ash we would sell to concrete producers for “Green Concrete.” 17 ENVIRONMENTAL 18
E N V I R O N M E N TA L C O M P L I A N C E 2 0 2 1 E N V I R O N M E N TA L G OA L S A N D 2 0 2 1 DATA AC Q U I S I T I O N A N D R E P O RT I N G CA PA B I L I T I E S G OA L S As part of our Environmental, Engineering, The Charah Solutions EEQ group has performed periodic Being the best possible stewards to the environment is extremely important. We know that we must keep improving and and Quality (EEQ) program, our continued and frequent site audits at each of our site operations, which we set goals across the Company to make sure we are innovating and benefiting the environment at every step. We have implementation of CCR-focused regulations, provides a site-specific comprehensive review of environmental, established short-term and long-term goals in the following areas: including the Coal Ash Management Act in North quality, and engineering compliance regarding a set standard of Carolina and the requirements of the EPA’s CCR compliance and methods of improvement. 2021 Environmental Goals rules, and regulatory agency involvement with Our site operations' compliance trends in each business unit, Charah Solutions site operations continue to 1-YEAR GOALS 5-YEAR GOALS identifying both areas of improvement and need are evaluated increase. We routinely engage with state and throughout the year and reported annually. Charah Solutions federal regulatory agencies, including MSHA, OSHA, 90% of land owned will be remediated and returned to its Remediate and return over 1,000 acres of land for successfully met expectations as no Notice of Violation (NOV) U.S. Army Corps of Engineers, as well as state natural habitat or redeveloped sustainably natural habitat or redevelopment was received by Charah Solutions during the 2020 analysis and federal environmental protection agencies. period. Our EEQ group continues to expand the use of our online We continue to meet regulatory monitoring and Increase the amount of CO2 saved from entering the environmental and quality auditing program, VelocityEHS. reporting requirements to comply with the Clean atmosphere by 10% Maintain operations free of a Notice of Violation or Notice Water Act, Clean Air Act, VelocityEHS provides EEQ and site operational teams of Deficiency Increase the percentage of CCRs that are RCRA, CERCLA, TSCA, compliance tools to measure project compliance with beneficially used or recycled by 10% ELG, and various state environmental and quality requirements specified by Charah regulations related to Solutions’ environmental and quality programs. The VelocityEHS Increase the amount of CCRs handled by 10% CCR management. program incorporates key components of our Corporate Quality Improve the number and quality of site audits and Program (CQP) and revised EEQ’s site auditing program. The inspections through updates to the program Increase the volume of recycled water used in site Charah Solutions VelocityEHS auditing program provides a framework and operations by 10% implemented an tools for EEQ to support project teams to ensure a project Evaluate water consumption for ways to reduce or Achieve ISO compliance for Charah Solutions satisfies the customers’ expectations and requirements replace with recycled water Environmental & Quality Program for environmental compliance as well as standardization of CQP project management practices key to Charah Solution’s continued growth and success. 2021 Data Acquisition And Reporting Capabilities Goals The total number of EEQ findings at all of Charah Solutions’ sites decreased during the audit period of 2019-2020. We 1-YEAR GOALS 5-YEAR GOALS attribute the decrease in findings to our CQP strict controls, completion of several significant projects, and impacts to site Increase tracking of operational water usage to include Implement resource tracking to report Scope 3 visitation due to COVID-19. Participation by site operations recycled water emissions improved in 2020 from 2019 and will continue to increase internet-based environmental and quality auditing in order to integrate better environmental compliance and Develop a method to track actual electrical energy usage Implement Life Cycle Assessment (LCA) analysis for program in late 2017 to promote the growth of quality initiatives and documentation into the overall operational by site to refine Scope 2 Emission estimates all Charah Solutions business units our environmental compliance program to meet program. We will continue to build on the success of the environmental management program, corporate quality Leverage information provided by Business the compliance needs of an increasing number Develop a method to track fuel usage by site to refine program, continuing field training, and assistance to site Intelligence (BI) initiative to optimize equipment idling of project sites as well as provide tools to our site and validate fuel consumption calculations with field data operations as needed to maintain the highest level of service to and reduce fuel usage operations to manage better and take ownership of site compliance at the site level. Our EEQ teams our customers to ensure all site compliance as required. Develop methods to track waste disposal, including provide site training at each project site to interact domestic waste, recycling, and industrial waste and participate in site auditing on a monthly or quarterly basis. 19 ENVIRONMENTAL 20
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OUR PEOPLE Since our founding, we have operated under the Charah Coming Together To Fight COVID-19 Way defined by our firm commitment to excellence, An excellent example of our team spirit is seen in our recent safety, customers, and each other. Our customers company-wide response to COVID-19. As the COVID-19 expect the best from us, and we as an organization pandemic became evident in March 2020, Charah Solutions expect and demand the best from each other. We quickly stepped up to the challenge as our employees' are accountable to each other. To understand our safety at our sites around the country remains our number performance in following Environmental, Social and one priority. Our mission-critical utility operations made it Governance, one must examine how our Company, our imperative to immediately implement COVID-19-specific culture, and our people follow our core values without safety protocols across our entire organization and with our compromise. Best Place to Work customers to keep our teams safe and our projects moving. Guided by core values of exceeding customer Even during the COVID-19 period, we were named to We quickly established a dedicated Safety Response Team expectations, safety, innovation, teamwork, sustainability, Louisville Business First’s 2020 list of the “Best Places to which implemented company-wide COVID-19 internal and integrity, Charah Solutions is an industry leading Work in Greater Louisville,” an annual program recognizing reporting and safety procedures for all sites, prohibited provider of mission-critical environmental services Louisville-area companies who are creating positive work all non-essential travel, and implemented a work from and byproduct sales to the power generation industry. environments for their employees. Charah Solutions was home program. Social distancing measures and increased With our proven team approach, we promote a work recognized as one of the top 16 companies in the category sanitization practices were instituted across the Company. environment characterized by considerate treatment of 25 – 150 local employees, representing employees at our Our ability to adapt as one team quickly has always made of others, open and honest communication, personal corporate headquarters and those who work at the LG&E Charah Solutions successful, and our field and office units accountability, trust, and mutual respect to provide Mill Creek Generating Station site. have adapted exceptionally well during this challenging superior service and sustainable solutions for our period. We believe our immediate safety response results customers. Each day is filled with opportunities for our and our team’s commitment to safety and communication employees to make an immediate contribution to the during this pandemic have been extremely successful in thinking, planning, and execution of our business and “We are honored to be named one of the keeping our employees, customers, and communities safe. the services we provide our customers. Our employees ‘Best Places to Work’ in Louisville and are are not just empowered but expected to speak up and participate. We are open to any and all ideas, thoughts, pleased that our employees have voted us or concerns that will help Charah Solutions continue a rewarding place to build their careers. to be the Company that sets high standards in the Charah Solutions has built a unique culture workplace. over the past 30 years, and I join my At Charah Solutions, we believe in: colleagues in celebrating our commitment workplace that is harassment free, safe, and A to each other in delivering excellence and provides growth and development opportunities ‘Service Above All’ to our customers every n Open Door policy where all employees can speak A day while having some fun while we do it.” to anyone across the business ccountability as we are each held accountable for A Jeremy Sochol our actions and to each other Senior Vice President of Rewards program with pay and benefits that meet A Human Resources the needs of our employees and their families Health and Wellness program that places the health A and safety of our employees first 23 SOCIAL 24
D I V E R S I T Y A N D I N C LU S I O N Policies And Training Our employees are critical to our success as well as the culture of our Company. We strive to establish fair policies and provide annual training to all employees as well as new employee onboarding training so we can achieve success together. Workforce Diversity We have set clear goals as a company to increase the What makes Charah Solutions truly exceptional goes diversity our workforce by 30% over the next three way beyond our response to exceptional times. It’s POLICIES what we do every day that sets us apart. We are years, and we are also putting initiatives into place in order to ensure that we meet or exceed these goals. committed to cultivating and preserving a culture of We believe it is the responsibility of all companies to Equal Opportunity Diversity No Discrimination Commitment Anti-Corruption Open Door diversity, equality and inclusion, and strive to ensure set clear goals and action plans to increase diversity Employment and Policy Harassment and Harassment to Diversity, Policy Program that all employees are treated fairly. We all have a and we know it starts with us. The initiatives we have Anti-Discrimination Policy Complaint Equality and Policy responsibility to treat others with dignity and respect put into place to increase our diverse hiring by 30% Policy Reporting Inclusion Procedures at all times. over the next three years include: We know that diversity and inclusion are keys to iversity Scholarship Program – We are D our success, and we strive to hire a wide variety instituting a scholarship program (or tuition of backgrounds, ethnicities, talents, and viewpoints repayment program) at heavy equipment training ANNUAL TRAINING while creating equal opportunities for females schools in which we will pay the tuition costs or and minorities. We are very proud that 10% of our reimburse tuition costs for diverse candidates in Anti-Harassment Safety Environmental Quality Training New Hire workforce is diverse and that this number continues order to hire ten entry-level diverse equipment Training Training Training Training to grow, but we also understand that we have more operators within the next year. work to do in order to provide increased opportunities iverse Apprenticeship Program - This D for minorities and women at all levels of the Company. apprenticeship program will provide the opportunity We recognize that diversity, inclusion, and belonging for new diverse hires to train and acquire the skills Open Door Program makes us a stronger team and more successful, and needed for trade/craft careers at our sites around we are committed to continuing the development of Our Open Door Program promotes a positive All of our sites and offices are required to display the country. This program will include onsite skills an organizational culture that champions equality by work environment by encouraging employees, our Open Door materials, including contact training and classroom learning and professional fostering a supportive work culture and business site/field leaders, and management to work information for Human Resources, regional leader, development training and education to ensure a practices free from barriers and biases. together collaboratively to address and resolve and our Ethics Hotline. successful career at Charah Solutions. workplace matters. This program provides Employees may anonymously contact our options through which employees can go directly Compliance Hotline to communicate issues and to their site/field leader with work-related concerns associated with allegedly inappropriate, questions and seek resolutions to workplace unethical, or illegal activities safely and honestly. concerns. Our Open Door Program policy prohibits retaliation mployees are encouraged to have E against employees for reporting their work-related conversations with their site/field leader questions, concerns, and suggestions at any time regarding their goals, work- to management, including alleged related concerns, or constructive feedback We understand that this investment discrimination or harassment complaints. professionally and respectfully. will not only provide needed We demonstrate our commitment to ite/field Leaders and management members S employees by responding effectively to opportunities for minorities and are encouraged to have conversations with all employee concerns. females but also make us a employees in a collaborative, constructive, and stronger team and more successful. respectful manner and to work together to reach the most appropriate resolution. 25 SOCIAL 26
Service To Country, Service To Environment We have a strong commitment to our nation’s service men and women and believe in the leadership and Board Diversity values that experienced veterans bring to our teams Our commitment to diversity and inclusion must as they have unique skills and talents that thrive in our go beyond our project sites - into our corporate team environment. Currently, 3.8% of our workforce offices and the Board Room. Our Board of Directors is comprised of military veterans, and we continue to represents 14.3% diversity with one minority female, recruit veterans heavily. and we have set a goal to better align our Board of We have also established a 1-year goal to increase our Charah Solutions is an active member of Hard Hat Heroes, Directors diversity with our workforce diversity goal. military veteran workforce by 30% as their military a group of military-friendly companies committed to By the end of 2021, our intention is to increase the background is an excellent supporting veterans seeking construction-related careers. diversity membership of our Board of Directors. fit with our teams of Hard Hat Heroes is a not-for-profit 501(c)(3) education The Charah Solutions Supplier Diversity Program uses industry-leading experts, foundation through the National Center for Construction Supplier Diversity the following diversity classifications: given their discipline, work Education and Research (NCCER), which provides As a part of our diversity and inclusion initiatives, Minority-Owned Businesses (African American, Asia ethic, and expertise to plan veterans free training to receive their NCCER construction we strive to ensure the suppliers we do business Pacific, Hispanic, Native American) and execute large projects. credentials, so they are more qualified to find careers in with represent a diverse group to assist with the construction industry and earn higher wages. Veteran-Owned Businesses economic development among diverse companies and within our communities. We are providing Woman-Owned Businesses expanded opportunities for diverse businesses to LGBTQ-Owned Businesses bid on projects at both our existing and new sites around the country as we develop a pool of diverse Service-Disabled Veteran-Owned Businesses 2 0 2 1 D I V E R S I T Y A N D I N C LU S I O N G OA L S supplier partners who share our commitment to HubZone Businesses (Historically Underutilized Being the best possible employer to our people and providing growth opportunities are essential values that we work to provide industry-leading services to the power Business Zones as designated by the U.S. Small accomplish every day. We know that we must keep improving, and we set goals across the Company to make sure we are always generation industry. Business Administration) progressing, innovating, and providing our employees opportunities to grow. Over the last 3 years, we have increased our average supplier diversity spend to 6% of procurement managed 1-YEAR GOALS 3-YEAR GOALS expenditures. Through a new partnership with Avetta, we are establishing greater visibility into our complete Increase the diversity of our Board of Directors supply chain. With this improved insight, we will be implementing clear goals to increase the diversity spend Create an apprenticeship program for new diverse Increase the diversity of our workforce by 30% managed through our procurement process. employees in our trades/crafts jobs Institute a Diversity Scholarship Program (tuition Hire 40 diverse heavy equipment operators repayment program) at heavy equipment training schools to hire ten entry-level diverse equipment operators Increase our military veteran workforce by 30% Increase diverse supplier spend to 15% Finalize tracking for diverse supplier spend to categorize Establish needed Employee Resource Group based upon suppliers not currently tracked as a part of diverse results of employee survey supplier spend 27 SOCIAL 28
H E A LT H A N D W E L L N E S S SA F E T Y L E A D E R S H I P All employees are provided the following coverages, How A True Safety Culture Responds to COVID-19 at no cost: A real example of our culture of safety was seen in Basic Life insurance coverage equal to their base salary how our management and our teams responded to the arrival of COVID-19. Basic Accidental Death and Dismemberment (AD&D) protection equal to their Basic Life coverage amount; As the COVID-19 pandemic hit in March 2020, Charah Short-Term Disability coverage; Long-Term Disability Solutions moved quickly to take steps to secure coverage the safety of our employees and operations. Our mission-critical utility operations made it imperative 401(k) Employee Savings Plan with Company contribution to immediately implement COVID-19-specific safety Employee Assistance Program, which provides access to protocols across our entire organization and in concert professional counseling, 24 hours a day, 365 days a year with our customers to keep our teams safe, projects We provide a robust health and wellness plan for all moving, and employees working. We also provide additional voluntary coverage options of our 600+ employees, which we are very proud that include: Beyond the guidance received from the Centers for of as our employees’ health and safety will always Supplemental Life and AD&D insurance options to all Disease Control and Prevention (CDC) and other be our number one priority. Our health and wellness employees, spouses, and children federal and state-level guidance, a dedicated Safety plan includes multiple medical, dental and vision plan Response Team was established, which implemented options, 100%-paid routine preventive health options Critical Illness insurance company-wide COVID-19 internal reporting procedures for our employees, and their covered dependents, Accident insurance for our sites and our Environmental Health and including screenings, annual preventive/wellness Safety department. We conducted COVID-19 updates exams, COVID-19 testing and immunizations. Legal assistance Safety is one of our core values. We are dedicated to company-wide daily. We prohibited all non-essential We also provide paid time off for all employees travel, implemented a work-from-home program, and maintaining a safe working environment and training to ensure they have the time needed to complete instituted social distancing and increased sanitization our employees and subcontractors to perform their their annual preventive exam. To encourage practices at every level. jobs safely while proactively contributing to a safe our employees in getting their 100% employer workplace. Managers were required to participate and report any paid physical, we subsidize 85% of the cost of A vital principle of the Charah Way involves actively safety or COVID-19 related updates during an 8:00 am our medical premiums. We provide discounted caring for those around us and working together as call every morning that included Regional Managers, medicines for chronic conditions like asthma, one team. Caring for our coworkers and acting as a Site Managers and Department Heads, followed with a cholesterol, diabetes, and heart disease to our team is a crucial part of working safely. It requires brief to Executive Leadership. By 9:30 am, a full report employees at a significant cost reduction, as well WE COVERED OVER us to coach and be coached when unsafe behaviors was sent to all sites where all COVID-19 safety items as telehealth care. We covered over $374,000 in costs for preventive care visits and maintenance $374,000 IN COSTS are identified or observed. Safety is not one person’s that need to be addressed were outlined for immediate responsibility; safety is everyone’s responsibility as action. These calls and reports took place seven medicines for our employees and their family for preventive care visits and well as being there for one another in times of crisis, days a week from March through July, then moved members in 2020. maintenance medicines for our employees which was recently evidenced by our company-wide to five days a week through the end of December and their family members in 2020. response to the COVID-19 pandemic. and starting in January 2021, are two days a week, dependent upon the health and safety needs of the sites and employees. 29 SOCIAL 30
Safety Excellence Is A Must With our employees compiling more than 100,000 person-hours of work per month, we take a proactive Charah Solutions recently passed a one-year safety approach to safety training and procedures. Our milestone with 1.19 Million person-hours of work without in-house Safety Department is comprised of a team an Occupational Safety and Health Administration (OSHA) of professionals who hold a multitude of advanced recordable incident. This significant achievement is a Specialized safety and health procedures degrees in their respective fields and have earned result of the commitment of all personnel to put safety communication materials were also created for our the highest and most highly respected professional first. employees, which included: certifications in the industry. These include Board of Our record in safety excellence also includes the following Certified Safety Professional designations of Certified COVID-19 Pandemic Response Plan achievements: Safety Professional (CSP), Associate Safety Professional COVID-19 Employee Absence Flowchart In 2020 we accomplished a 0.36 Total Recordable (ASP), Occupational Safety and Hygiene Technologist Incident Rate (TRIR) with no lost time or restricted (OSHT), Construction Health and Safety Technician COVID-19 Keeping The Workplace Safe Procedures time injuries in comparison to the most recent industry (CHST), as well as several team members who are COVID-19 Keeping Your Home Safe Procedures Total Recordable Incident Rate industry average of 3.1 Authorized Outreach Trainers for the U.S. Department Equipment Cleaning Guidelines of Labor in both Construction and General Industry. Our n impressive three-year average Experience A in-house Safety Department also includes professionals Working Remotely Overview & IT Procedures Modification Rate (EMR) of less than 0.7 who are accredited Occupational Safety and Health Work From Home Tips During COVID-19 Policies We know it’s imperative that we continuously assess Administration (OSHA) trainers, along with full-time Establishing A Safety Culture our Safety performance and that quality of safety transportation specialists in both over-the-road (OTR) Tips to Improve Your Work From Home Routine Our successful response to the challenge of COVID-19 performance is a behavior that can be regularly and rail operations. We increased sanitization practices across the was made possible by our Culture of Safety. Our measured. Our Managers and Safety Specialists utilize Company, provided disposable surgical masks to all commitment to the safety of our team members an advanced predictive analytics tool to document, job sites, and increased the number of hand sanitizing and the environment will never waver. Simply stated, monitor, and track behaviors and conditions. This tool stations. We implemented screening procedures at our work does not go forward unless our people can utilizes observations, incidents, and historical event the sites that include temperature check stations and proceed safely. And we will not go forward with any data to provide valuable information that we thoroughly the stocking of all offices, conference rooms, heavy project that puts the environment at risk. There is no assess. We provide our site, regional, and executive equipment, and trucks with disinfectant wipes/spray room for compromise in any of these critical areas. leadership “dashboards” that detail incident and and hand sanitizer. All equipment is wiped down before observation data from the previous week, month, and We take a very comprehensive approach to ensure the morning shift starts and after year and identify particular trends in that data. We use that all employees advance our Culture of Safety. We the shift ends, and then again this information to customize plans to mitigate hazards stress that safety is not just the responsibility of the before the afternoon shift starts and reverse any negative trends aggressively. Safety Department; in fact, it is each team member’s and at the end of the day. We also responsibility to deliver a Culture of Safety. We also use this data, along with other analytical data, provided hand sanitizer and masks We have made it the responsibility of every team at the project level to compare statistical data across to anyone who needed them member, regardless of rank or position, to call “All regions and job sites. Over the last four years, our team at home. Stop” and take preventive action when safety is at has completed over 30,000 inspections and 1.3 million Increased social distancing measures include observations, with more than 12,000 opportunities for risk. Every team member has the right to challenge staggered shift start/end times and break times with improvement identified. our leaders/management, whether they have been additional break spaces established. Safety meetings on our team for 30 years or 30 minutes. Our safety are held outside of the site trailers so that the 6-foot policy protects every team member from fear social distancing requirement is never compromised, Behavioral Based Observations of repercussions, as it is non-punitive and non- and employees are asked to eat lunch in their vehicles. judgmental because safety is always our #1 priority. Our ability to adapt as a team quickly has always been YEAR INSPECTIONS OBSERVATIONS AVERAGE #/INSPECTION a crucial part of Charah Solutions’ success, and our field and office units have adapted exceptionally well 2020 10,433 524,102 50 during this challenging period. 31 SOCIAL 32
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