Jeremy Eaton VP and GM Smart Grid Solutions Consumers and the Electric Grid: Will Consumers Dictate What Services They are Provided in the Future? NARUC Winter Conference February 9, 2014

Honeywell.com  2 Copyright © 2013 Honeywell International Inc. All rights reserved. Heritage of Energy Efficiency 150 Million Homes

Honeywell.com  3 Copyright © 2013 Honeywell International Inc. All rights reserved. Megatrends changing the way consumers interact with all systems in their home—everything is getting connected This year, mobile Internet usage will take over desktop Internet usage ~70% of homes already have Wi-Fi 63% of homes have smartphones… and that number grows daily

Honeywell.com  4 Copyright © 2013 Honeywell International Inc. All rights reserved. This applies to HVAC as well— the biggest energy load in the home

Honeywell.com  5 Copyright © 2013 Honeywell International Inc. All rights reserved. Homeowners want Comfort, Convenience and Control Consumers rapidly adopting Wi-Fi Thermostats  Driven by comfort and control—NOT energy  90% of interactions via the mobile app  Honeywell mobile app rated 4.8 on iTunes and Energy Efficiency is coming along for the ride  Honeywell Wi-Fi stats TWICE as likely to be in schedule mode  DR-enabled

Honeywell.com  6 Copyright © 2013 Honeywell International Inc. All rights reserved. Connectivity Key in Commercial Trends Active Energy Management Distributed generation (renewable, CHP) Microgrids to increase resiliency and flexibility Use of buildings and OpenADR to increase value, e.g. balancing renewable intermittency

Honeywell.com  7 Copyright © 2013 Honeywell International Inc. All rights reserved. Recommendations for Utility Regulators Provide certainty, timeliness, and equality for cost recovery involving demand and supply side investments; Empower all consumers to actively manage energy usage by requiring utilities to offer time-varying rates that are actionable and tied to wholesale market prices (where applicable) and by promoting access to control technology; Use of standards such as OpenADR to reduce issues associated with renewable intermittency; and Encourage new utility business models and flexibility

Honeywell.com  8 Copyright © 2013 Honeywell International Inc. All rights reserved. NEMA is the association of electrical equipment and medical imaging manufacturers, founded in 1926 and headquartered in Arlington, Virginia. Its 400-plus member companies manufacture a diverse set of products including power transmission and distribution equipment, lighting systems, factory automation and control systems, and medical diagnostic imaging systems. The U.S. electroindustry accounts for more than 7,000 manufacturing facilities, nearly 400,000 workers, and over $100 billion in U.S. shipments. National Electrical Manufacturers Assn. (NEMA)

Honeywell.com  9 Copyright © 2013 Honeywell International Inc. All rights reserved. Thank Global VP and GM Smart Grid Solutions