The Boardroom With...
Mr. Mike Taylor
Vice President of Americas Marketing
Honeywell Building Solutions
It’s a pleasure to speak with you again, Mike, this time about Honeywell’s
water solutions. One will read on Honeywell.com that, “As a basic
life-sustaining element, water has become increasingly precious. In fact,
water supply, treatment, distribution and use are at all-time highs with
no signs of letting up. For these reasons and more, Honeywell assists
organizations responsible for water management with effective conservation
strategies that can be implemented quickly.” Please give us an overview
of Honeywell’s water solutions and capabilities.
Mike Taylor: Honeywell works with a number of organizations, such as utilities
and water municipalities, to manage water conservation programs on their
behalf. We have more than 20 years experience in this area, primarily
in regions where water availability is a major concern, such as Southern
California. Our programs help consumers and businesses reduce water consumption
by more than 10 billion gallons per year.
For instance, we teamed with the California Public Utilities Commission
and the California Urban Water Conservation Council to replace spray valves
on dishwashing units in restaurants throughout southern part of the state
to save hot water and conserve water overall. We also collaborated with
the Los Angeles Department of Water and Power to implement a successful
low-flow toilet installation program.
But while organizations in California and other Sun Belt states have
traditionally had the most need for these types of programs, they aren’t
the only ones to express interest in water conservation. We worked with
the New York City Department of Environmental Protection, for example,
to develop a campaign that included mailing low-flow shower heads to residents
and offering leak inspections to ensure plumbing systems were in working
These programs are all good examples of public/private efforts that help
ensure water availability and improve the environment.
SecurityStockWatch.com: We understand that Honeywell provides solutions
to utilities, municipal customers, public housing authorities and also
the residential market. Please give us an overview of your target markets
and how do you reach them?
Mike Taylor: Based on our expertise and strong industry relationships,
we focus most of our efforts on working with utilities and water municipalities
to implement conservation programs on their behalf. We have strong marketing
and direct field sales outreach programs to promote these programs and
motivate customers to participate.
We also help public entities like housing authorities, school districts,
etc. upgrade their water efficiency by installing new toilets, fixtures
and the like. These improvements are usually part of a larger effort to
reduce utility costs and improve facility infrastructure.
SecurityStockWatch.com: The green movement seems to be gaining momentum.
Is water conservation a part of that? What is your perspective of the
market drivers for water solutions at this time?
Mike Taylor: Definitely, water conservation is a part of the green movement.
But, as most people can attest, water conservation has been eclipsed in
part by the intense focus on energy efficiency and conservation in this
country. We’ve consistently engaged with numerous organizations
in California to implement water conservation programs, but in other parts
of the country, the need has been more sporadic. A drought may hit somewhere
in the Midwest, and there’s a movement locally to take a closer
look at how the community is using its water resources. Once the drought
stops, interest tends to fade.
This phenomenon gets at the key market driver for water conservation,
which is availability. Water is a finite resource, and it’s much
harder to move around than electricity, which can be transported from
Los Angeles to New York City with a few switches on the grid. It may be
very expensive to transport electricity in this way, but it’s ultimately
there when you need it. This may not be the case with water.
SecurityStockWatch.com: One will also read on Honeywell.com that,
“A Honeywell energy savings performance contract can help your agency
reduce energy and operating expenses, and leverage those savings to pay
for needed building improvements — without any increased costs to
taxpayers.” It seems like a real win-win situation because rising
and unpredictable costs can make it very challenging to budget, plan and
pay for needed improvements. Please give us an overview of Honeywell’s
energy savings performance contracting business. How does it work?
Mike Taylor: You hit on an important point, which is the volatility
of the energy market. We don’t know at what rate energy prices will
continue to rise. And with that kind of uncertainty, it makes it difficult
for organizations to plan for the future, especially when budgets are
Energy savings performance contracts (ESPCs) are a financing tool that
organizations have used for years to address deferred maintenance issues,
upgrade facilities and reduce energy costs.
An ESPC is really pretty simple. Honeywell works with the customer to
conduct an audit, identifying facility improvements that help reduce energy
consumption and costs. This could include replacing boilers and chillers,
tightening the building envelope to reduce the loss of hot or cool air,
or installing renewable energy technologies like solar panels or biomass
boilers. Water-efficiency upgrades are often part of the mix as well.
Based on the conservation measures identified, Honeywell is able to guarantee
a specific level of savings over time, usually between 10 to 20 years.
Those guaranteed savings fund the improvements so the work does not impact
Since the early 90s, Honeywell performance contracts have delivered more
than $3 billion in energy and operational cost savings to educational,
municipal and federal facilities, and ESPCs continue to be an attractive
way for our customers to address their infrastructure needs.
SecurityStockWatch.com: Congratulations on the recent “win”
with Quincy, Massachusetts. What is the solution Honeywell provided here?
Mike Taylor: The City of Quincy energy conservation project is an excellent
example of an ESPC that is allowing the municipality to reduce energy
costs, improve its buildings and cut greenhouse gas emissions.
The 20-year contract, which is the first of its kind for a Massachusetts
city since the state passed legislation that allows municipalities to
enter into long-term energy saving projects, includes upgrades to 40 of
the community’s buildings and public schools. In addition to traditional
upgrades such as heating and air conditioning improvements, we also will
install a solar panel at an elementary school that will use renewable
energy to heat the school’s pool. We also will help the city increase
its annual revenue by $1.25 million with an improved water metering system.
Quincy will save $1 million per year as a result of the energy-efficient
improvements, reducing the city’s electricity use by an estimated
25 percent and natural gas and heating oil use by 27 percent. The decrease
in energy consumption is expected to curb more than 5.2 million pounds
of annual carbon dioxide emissions, which is equivalent to removing more
than 500 cars from the road.
SecurityStockWatch.com: Are there other success stories you’d like
to talk about?
Mike Taylor: You may have recently heard that Honeywell was selected by
the U.S. Department of Energy (DOE) to help it meet stringent federal
requirements for reducing energy consumption and greenhouse gas emissions.
This is a very exciting engagement for us, as the initiative is expected
to make the DOE the first agency to meet all environmental, energy and
transportation goals set forth in President Bush’s Executive Order
By using ESPCs, Honeywell will help various DOE sites hit the targets
in the executive order, which requires agencies to reduce energy intensity
by 3 percent per year, or 30 percent by the end of fiscal year 2015. It
also calls for a 16 percent reduction in water consumption, through the
use of state-of-the-art sustainable building components and advanced meters
that can monitor electric, thermal and water consumption. We look forward
to working with the DOE to achieve these environmental goals.
SecurityStockWatch.com: Honeywell water solutions are part of a broader
set of solutions to make buildings safer and more secure. I know we are
focusing here primarily on water solutions but please give us an overview
of Honeywell’s Safety & Security solutions?
Mike Taylor: Part of Honeywell’s brand promise is to build a world
that’s “safer and more secure,” and we’re always
looking for new ways to ensure that our customers’ people, facilities
and assets are adequately protected.
Honeywell has a full portfolio of safety and security offerings, including
access control, digital video, security management, smoke and fire detection,
and emergency notification. We also offer integrated building management
platforms that allow facility managers to view and control all building
functions — including security and life safety — from a single
workstation. This helps boost efficiency and reduce operating costs.
In addition, we often leverage technologies that are developed elsewhere
in Honeywell and incorporate them into our security solutions. For instance,
video analysis software developed by Honeywell Labs, advanced sensors
from the Sensing and Control business and GPS systems from Honeywell Aerospace
have all been used to meet our customers’ security requirements.
SecurityStockWatch.com: With regard to Homeland Security, our utility
infrastructure is known to be vulnerable. What are Honeywell’s solutions
for water treatment facilities?
Mike Taylor: You’re right. The U.S. Department of Homeland Security
has identified “drinking water and water treatment systems”
as one of the 17 critical infrastructure and key resource sectors that
require protective action to guard against a terrorist attack or other
Generally, issues of concern at these utilities include lack of adequate
guard facilities at the front and rear entrances, porous perimeters with
inconsistent barrier protection, regular trespassing from public recreation
and nearby residential neighborhoods, and lack of remote monitoring for
critical sites, such as pump stations and barge areas.
Honeywell helps customers across the globe address these concerns. Careful
security planning, rigorous risk assessment, detailed countermeasure design,
robust program management, sophisticated technologies, skilled manpower
with security application expertise, and diligent lifecycle management
are all part of what we offer in this area.