Volvo Aero Turbines (UK) signs gas turbine agreement with Honeywell Control Syste

12/30/1998 5:27 AM EST

VOLVO AERO TURBINES (UK) SIGNS GAS TURBINE AGREEMENT WITH HONEYWELL CONTROL
SYSTEMS


Volvo Aero Turbines (UK) Ltd. has signed a Memorandum of Understanding (MoU)
with Honeywell Control Systems Ltd.


The agreement makes Volvo Aero Honeywell's preferred supplier particularly
when it comes to gas turbine installations in the UK healthcare market. The
main area of business concerned is Combined Heat and Power (CHP) plants that
supply hospitals in the UK with both heat and electric power. Other markets
could be involved in the future.

The first contract signed under this MoU concerns the installation of Volvo
Aero's CHP unit, the VT600, at a hospital in Wales. A second contract concerns
a similar plant at a hospital in England.

Honeywell Control Systems offers its customers "Contract Energy Management",
which means they only pay for the electricity supplied; the heat is free of
charge.

Honeywell's orders from hospitals in the UK include numerous energy-saving
measures in which Volvo Aero's CHP facilities play and important role.

In other contexts, in powerrange of 600 kW to 5 MW, Volvo Aero can supply
similar contracts which also will include full costumer support and financing
in cooperation with the finance company Volvo Contract Services in the UK.


December 30, 1998


For further information, please contact, Ian Grant, +44 1203 308900 or Lars
Bergdahl, +46 (0)520 941 50.