ENVIRONMENT SECURITY
Alternative Energy Solutions
Water Solutions

Mr. Mike Taylor
Vice President of Americas Marketing
Honeywell Building Solutions
www.honeywell.com/buildingsolutions
NYSE:HON

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 incident. More>>

Water Solutions

Water, water, everywhere?

Not anymore.

Water is becoming a scarce resource and there is money to be made by the companies with rights to water resources and the distribution networks to provide it.

The water utility industry, over an extended period of time, has been one of the best performing sectors in the financial markets.

Water utilities have an excellent dividend paying policy.

These are some of the market drivers affecting water stocks at this time:

- world population will double within then next 100 years!

- per capita water consumption is rising.

- dwindling supplies of water.

- escalating water quality awareness.

- aging, deteriorating, water distribution infrastructures.

- emergency repairs and re-building due to Katrina type events.

- industry consolidation will continue.

These are just some of the companies we are tracking in the Water sector: American States Water (AWR); Ameron (AMN); Aqua America (WTR); Artesian Resources (ARTNA); Calgon Carbon (CCC); California Water (CWT); Connecticut Water Service (CTWS); Consolidated Water (CWCO); Layne Christensen (LAYN); Pall (PLL); Pentair (PNR); Pico Holdings (PICO); SJW (SJW); Southwest Water (SWWC); Tetra Tech (TTEK); URS (URS); United Utilities (UU); Veolia Environment (VE); Watts Water (WTS); York Water (YORW).

American States Water Company (www.aswater.com) is the parent of Golden State Water Company, American States Utility Services, Inc. and Chaparral City Water Company. Through its subsidiaries, AWR provides water service to 1 out of 30 Californians located within 75 communities throughout 10 counties in Northern, Coastal and Southern California, approximately 254,000 customers and to approximately 13,000 customers in the city of Fountain Hills, Arizona and a small portion of Scottsdale, Arizona. The Company also distributes electricity to approximately 23,000 customers in the Big Bear recreational area of California. Through its non-regulated subsidiary, American States Utility Services, the Company contracts with municipalities, the U.S. government and private entities to provide various services, including billing and meter reading, water marketing and operation and maintenance of water and wastewater systems at various military installations throughout the United States.

Ameron (www.ameron.com) is a multinational manufacturer of highly-engineered products and materials for the chemical, industrial, energy, transportation and infrastructure markets. Traded on the New York Stock Exchange (AMN), Ameron is a leading producer of water transmission lines; fiberglass-composite pipe for transporting oil, chemicals and corrosive fluids and specialized materials and products used in infrastructure projects. The Company operates businesses in North America, South America, Europe and Asia. It also participates in several joint-venture companies in the U.S. and the Middle East.

Aqua America (www.aquaamerica.com), is the largest U.S.-based publicly-traded water and wastewater utility holding company, serving more than 2.5 million residents in Pennsylvania, Ohio, North Carolina, Illinois, Texas, Florida, New Jersey, Indiana, Virginia, Maine, Missouri, New York, and South Carolina. Aqua America is listed on both the New York and Philadelphia Stock Exchanges under the ticker symbol WTR.

Artesian Resources (www.artesianwater.com), through our wholly owned subsidiary Artesian Water Company, is the largest investor owned regulated public water utility in the State of Delaware and has been providing water within the state since 1905. About $174 million has been invested in Artesian's utility plant over the last 10 years to provide sufficient treated supply, new water mains and additional storage capacity to meet peak demands and provide fire protection for Delaware residents. We distribute and sell water to residential, commercial, industrial, governmental, municipal and utility customers throughout the state. As of June 30, 2006, Artesian was serving approximately 73,000-metered customers, providing water service to about 242,000 residents (including contract services), approximately 29% of Delaware's total population. Last year, Artesian distributed 7.5 billion gallons of water. Artesian serves its customers through 107 operating wells. Artesian's water supply is treated at 50 different locations statewide. Artesian owns and maintains approximately 1,000 miles of water main throughout the state.

Calgon Carbon (www.calgoncarbon.com), headquartered in Pittsburgh, Pennsylvania, is a global leader in services and solutions for making air and water cleaner and safer.

California Water (www.calwatergroup.com) is the parent company of California Water Service Company, Washington Water Service Company, New Mexico Water Service Company, Hawaii Water Service Company, Inc., and CWS Utility Services. Together these companies provide regulated and non-regulated water service to more than two million people in 100 California, Washington, New Mexico, and Hawaii communities. Group's common stock trades on the New York Stock Exchange under the symbol "CWT."

Connecticut Water Service (www.ctwater.com) is the largest, domestic-based, investor-owned water utility in New England. It provides water to over 82,000 customers in 41 towns in Connecticut, as well as providing water-related services under contract to municipalities and companies.

Consolidated Water (www.cwco.com) develops and operates seawater desalination plants and water distribution systems in areas of the world where naturally occurring supplies of potable water are scarce or non-existent. The Company currently operates water production and/or distribution facilities in the Cayman Islands, Belize, Barbados and the Bahamas. The Company's affiliate, Ocean Conversion (BVI) Ltd., also produces and distributes water in the British Virgin Islands. The Company has also been notified that the bid of its affiliate, Consolidated Water (Bermuda) Limited, to build and operate a seawater desalination plant in Bermuda has been accepted. The Company's ordinary shares are listed on the Nasdaq Global Select Market under the symbol "CWCO."

Layne Christensen (www.laynechristensen.com) provides sophisticated services and related products for the water, mineral, construction and energy markets.

Pall (www.pall.com) is the global leader in the rapidly growing field of filtration, separation and purification. Pall is organized into two businesses: Life Sciences and Industrial. These businesses provide leading-edge products to meet the demanding needs of customers in biotechnology, pharmaceutical, transfusion medicine, energy, electronics, municipal and industrial water purification, aerospace, transportation and broad industrial markets. Total revenues for fiscal year 2006 were $2.0 billion. The Company headquarters is in East Hills, New York with extensive operations throughout the world.

Pentair (www.pentair.com) (NYSE:PNR - News) is a diversified operating company headquartered in Minnesota. Its Water Group is a global leader in providing innovative products and systems used worldwide in the movement, treatment, storage and enjoyment of water. Pentair's Technical Products Group is a leader in global enclosures and thermal management markets, designing and manufacturing thermal management products and standard, modified, and custom enclosures that house and protect sensitive electronics and electrical components. With 2005 revenues of $2.95 billion, Pentair employs approximately 15,000 people worldwide.

Pico Holdings (www.picoholdings.com) is a diversified holding company. Currently our two major businesses are Vidler Water Company, a water resource development business, and Nevada Land & Resource Company, the largest private landowner in the state of Nevada. Vidler is a significant private sector owner of water resources and water storage assets in Nevada and Arizona. Nevada Land owns approximately 700,000 acres of land in northern Nevada, and the water and mineral rights related to its lands.

SJW (www.sjwater.com) is a publicly traded holding company headquartered in San Jose, California. SJW Corp. is the parent company of San Jose Water Company, Canyon Lake Water Service Company, SJW Land Company and Crystal Choice Water Service, LLC. Together these companies provide regulated and nonregulated water service to more than one million people in San Jose, California and nearby communities and Canyon Lake, Texas. SJW Land Company owns and operates parking facilities, commercial buildings, undeveloped land, has a majority interest in a real estate partnership and has properties in the states of California, Florida, Connecticut, Texas and Arizona.

Southwest Water (www.swwc.com) provides a broad range of operation, maintenance and management services, including water production, treatment and distribution; wastewater collection and treatment; customer service; and utility infrastructure construction management. The company owns regulated public utilities and also serves cities, utility districts and private companies under contract. Approximately two million people from coast to coast depend on Southwest Water for high-quality, reliable service.

Tetra Tech (www.tetratech.com) is a leading provider of consulting, engineering and technical services. With approximately 7,500 associates located in the United States and internationally, the Company supports commercial and government clients in the areas of resource management and infrastructure. Tetra Tech's services include research and development, applied science and technology, engineering design, program management, construction management, and operations and maintenance.

URS (www.urscorp.com) offers a comprehensive range of professional planning and design, systems engineering and technical assistance, program and construction management, and operations and maintenance services for transportation, commercial/industrial, facilities, environmental, water/wastewater, homeland security, installations and logistics, and defense systems. Headquartered in San Francisco, the Company operates in more than 20 countries with approximately 29,400 employees providing engineering and technical services to federal, state and local governmental agencies as well as private clients in the chemical, pharmaceutical, oil and gas, power, manufacturing, mining and forest products industries.

United Utilities PLC (www.unitedutilities.com) was created from the merger of North West Water and Norweb in November 1995. Its shares are listed on both the London Stock Exchange and New York Stock Exchange (in the form of ADRs). Its principal activities are managing and operating the regulated electricity distribution, water and wastewater networks in north west England, a region with a population of around 7 million. In August 2000 United Utilities sold its electricity and gas supply business and as a result no longer has any significant exposure to the competitive UK generation and supply market. As well as operating utility networks in the north west, the group also owns two support services businesses: United Utilities Contract Solutions and Vertex. These businesses apply the group's core skills of infrastructure management and business process management in the provision of services to others. United Utilities is a member of the FTSE 100 group of leading UK listed companies and employs over 17,000 people.

Veolia Environment (www.veolia.com) (Paris Euronext: VIE and NYSE: VE) is a world leader in environmental services. With more than 270,000 employees the company has operations all around the world and provides tailored solutions to meet the needs of municipal and industrial customers in four complementary segments: water management, waste management, energy management and passenger transportation. Veolia Environnement recorded revenue of €25.2 billion in 2005.

Watts Water (www.wattsind.com) is a world leader in the manufacture of innovative products to control the efficiency, safety, and quality of water within residential, commercial, and institutional applications. Its expertise in a wide variety of water technologies enables it to be a comprehensive supplier to the water industry.

The York Water Company (www.yorkwater.com) is the oldest investor-owned water utility in the United States and has operated continuously since 1816. The Company impounds, purifies and distributes water to approximately 56,000 customers entirely within its franchised territory located in York County, Pennsylvania and Adams County, Pennsylvania.