If you had to invest a certain amount of money in either innovation or adoption of already existing technologies - or a combination of both - where would you focus your investments?
It's going to be a mix of both improving current technologies and investing in new ones. We constantly see advancements making technologies more affordable and widely available, which is essential for a net zero world. Achieving this requires scaling these technologies, which means we need to start implementing them now, not waiting for them to become cheaper in the future. This immediate action helps mitigate the climate crisis. Many technologies are already economically viable, and governments provide incentives to encourage early adoption, which can lead to significant financial benefits for those who invest early.
Additionally, while implementing these technologies, continuous investment in improvement is crucial. We need to enhance the efficiency and effectiveness of these technologies. For instance, early adopters of certain technologies have seen substantial returns, which further emphasizes the need for immediate action. This dual approach of implementing and improving ensures that we can achieve our climate goals more effectively.
Could you tell me more about the targets of your 2035 carbon neutrality plans and the roadmap to achieve them?
We have pledged to achieve carbon neutrality in our facilities and operations by 2035, covering all scope one and scope two emissions. We've already made significant progress, reducing our carbon footprint by 90% since 2004. Now, we're focusing on the harder part—addressing our manufacturing footprint, which constitutes 92% of our carbon emissions. Another 4% comes from our high-energy-intensity laboratories, and the remaining 4% is from our offices, service sites, warehouses, and fleets.
To achieve carbon neutrality, we are focusing on electrifying our industrial facilities, improving energy efficiency in ventilation and air conditioning systems, and addressing difficult-to-decarbonize heat sources in our chemical manufacturing facilities. We're considering switching to hydrogen fuel or implementing carbon capture for high-temperature processes. We’re also part of the DOE's Clean Energy Challenge, aiming for a 50% reduction in our U.S. carbon footprint by 2030. This requires detailed planning and significant investment, but our investors and board are fully supportive, allowing us to move forward with these crucial projects.
Can you provide examples of cost-effective green technologies you've implemented at Honeywell in recent years?
Wind and solar power prices have dropped significantly, making them cheaper than new hydrocarbon-based power generation. We've leveraged this by implementing brownfield solar projects, using unused land for solar installations, and signing power purchase agreements to secure renewable electricity. However, renewable power needs to be firmed up for consistent supply, which we achieve through microgrids. Microgrids enable us to integrate renewable power with batteries, providing resilience and reducing reliance on peak grid power.
We’ve executed microgrid projects at several of our sites, using the same technology we offer to our customers, including oil refineries, petrochemical sites, and government campuses. These systems allow us to store renewable energy and ensure continuous power supply, demonstrating the practicality and cost-effectiveness of integrating renewables into our operations.
Tell me about some of the recent technologies Honeywell is working on that you're particularly excited about.
One exciting development is our focus on tackling methane emissions and high global warming gasses. Methane, for instance, has a much higher carbon footprint than CO2. We developed a technology called Honeywell Rebellion cameras, which can see in the infrared spectrum to detect these gasses. Combining these cameras with low-cost detectors allows us to identify and address leaks efficiently. This technology has significantly reduced Honeywell’s process emissions and is now being used by oil and gas producers to manage their methane emissions.
Do you think creativity is key to address the climate crisis through technology?
Absolutely. Innovation in technology is crucial for tackling climate challenges. For example, Honeywell Rebellion cameras use artificial intelligence to interpret data and identify gas leaks accurately. This integration of digitalization and automation enhances the effectiveness of our technologies. The potential for innovation in the sustainability space is immense. And it can use AI but it doesn't always have to involve it..
In another instance, we saw significant value from a digital benchmarking initiative in Singapore. The government’s Green Mark for buildings program anonymizes energy usage data, allowing comparisons across buildings. This transparency encourages efficiency improvements and provides a competitive advantage for greener buildings. Such initiatives demonstrate how data can drive both sustainability and commercial benefits, highlighting the role of creativity and innovation in addressing climate issues.
Considering the global efforts towards green transition, are there areas where current approaches could be improved for better efficiency and effectiveness?
There are always opportunities for improvement, particularly in aligning policies with market realities. For example, the renewable energy certificate (REC) system in the U.S. was designed to incentivize renewable power projects. However, it wasn't intended to be the primary system for tracking greenhouse gas intensity of electric supply for regulatory purposes. As we integrate more renewable energy, we need to ensure that incentives align with actual energy storage needs, encouraging the development of battery storage to balance renewable supply.
Additionally, there's a debate about whether to prioritize greening the grid or electrifying everything first. Both are essential, and we need to build scale in all technologies to make them the default, most cost-effective options. Addressing these policy and market alignment issues can enhance the efficiency of our transition to renewable energy sources.
Given the challenges with battery storage technology, what is your outlook on its future development and potential impact on the energy transition?
Batteries are crucial but not the only solution for energy storage. As electric vehicle adoption increases and more homes install solar panels, the availability of batteries will grow. Utility-scale batteries are also becoming significant, as seen in California, where batteries have provided substantial power during peak times. Incentivizing battery systems is essential for managing the daily and seasonal fluctuations in renewable energy supply.
However, batteries alone cannot solve the issue of long-term energy storage. Moving renewable power from sunny summer days to cloudy winter ones requires different solutions.
The cost of using batteries for long-term storage is prohibitively high, highlighting the need for a mix of technologies to address various storage needs. Developing a comprehensive approach to energy storage, including both short-term and seasonal solutions, will be critical for the successful transition to a renewable energy future.
