FuelCell Energy Teams With Chevron Energy Solutions to Sell Its First One Megawatt DFC1500 Unit in California to Alameda County

Oct 25 - Business Wire

'Ultra-Clean' Fuel Cell Power Plant to Provide Base Load Power and Heat for Alameda County's Correctional Facility

FuelCell Energy, Inc. (NasdaqNM:FCEL), a leading manufacturer of large stationary fuel cell power plants for commercial and industrial customers, announced today its first one-megawatt Direct FuelCell(R) (DFC(R)) power plant sale in California to Alameda County for the Santa Rita Jail in Dublin, Calif. This is the first fuel cell project with its North American distribution partner, Chevron Energy Solutions.

FuelCell Energy will provide Alameda County a DFC1500 power plant and related operating and maintenance services. Chevron Energy Solutions will act as overall project manager and integrator, providing design, engineering, construction, and installation services to Alameda County. The DFC1500 power plant is expected to provide 90 percent of base load power requirements for the Santa Rita Jail.

"The addition of this 1 megawatt (MW) fuel cell power plant to the jail's existing 1.18 MW solar power system gives the County the most environmentally-sound distributed power system in the country. We are excited to be able to combine the base load capabilities of this fuel cell plant with the daytime peaking characteristics of photovoltaics. This will be the first-of-its-kind facility to take advantage of these two clean emerging technologies," said Alameda County's Energy Program Manager Matt Muniz.

"This project demonstrates that our 'ultra-clean' DFC power plants can provide a cost-effective and environmentally sound energy solution for institutional customers," said Stephen R. Torres, FuelCell Energy's Western Region Vice President. "Correctional facilities, with their stable base load power requirements, provide another key vertical market for our DFC products."

The market for combined heat and power applications for correctional facilities in the U.S. is estimated to be 2,700 megawatts, based on a January 2000 study prepared for the U.S. Department of Energy by ONSITE SYSCOM Energy Corporation.

"We applaud Alameda County officials for their innovation in implementing a totally environmentally friendly approach to reducing their energy consumption and costs," said Jim Davis, President of Chevron Energy Solutions. "We believe this can be a model to be followed by other municipalities and institutions in California."

The new Santa Rita Jail is recognized as one of the most technologically innovative jails in the world. The facility holds about 4,000 inmates in 18 modern housing units. It is considered a "mega-jail" and ranks as the third largest facility in California and fifth largest in the nation. Santa Rita is accredited by the American Correctional Association, thus making it the only facility in California holding this prestigious award.

Alameda County is receiving up to $1.4 million in project funding from the California Public Utilities Commission's Self Generation Incentive Program, as well as a $1 million grant from the U.S. Department of Defense's 2003 Climate Change Fuel Cell Program.

About Direct FuelCells

Direct FuelCells efficiently generate clean electricity at distributed customer locations, including hospitals, schools, universities, hotels and other commercial and industrial facilities, as well as in grid-support applications for utility customers. Direct FuelCells operate similar to large, continuously operating batteries except they utilize a fuel to generate electricity, such as natural gas or digester gas from wastewater treatment facilities. DFC power plants are hydrogen generators, and because of this are ready today and do not require the creation of a hydrogen infrastructure. This high-efficiency technology generates more electric power from less fuel and with less carbon dioxide emissions than traditional combustion methods. The sub-megawatt fuel cell power plant is a collaborative effort using Direct FuelCell(R) technology of FuelCell Energy and the HotModule(R) balance of plant design of MTU CFC Solutions, GmbH, a subsidiary of DaimlerChrysler.

About Chevron Energy Solutions

Chevron Energy Solutions, a subsidiary of ChevronTexaco, partners with institutions and businesses to improve facilities and increase their efficiency, help reduce energy expenses and help ensure reliable, high quality power for critical operations. Its customers include federal government agencies; state, county and municipal government agencies; schools, colleges and universities; and many other public institutions and commercial and industrial businesses. With about two dozen offices nationwide, the company maintains in-house engineering, monitoring and project management capabilities, provides financing options and delivers solutions designed to address each customer's particular needs without promoting specific vendors, products or commodities. More information is available at www.chevronenergy.com.

About FuelCell Energy, Inc.

FuelCell Energy, Inc., based in Danbury, Connecticut, is a world leader in the development and manufacture of high temperature hydrogen fuel cells for clean electric power generation. The Company has developed commercial distribution alliances for its carbonate Direct FuelCell products with Chevron Energy Solutions, Caterpillar, PPL Energy Plus, Alliance Power and LOGANEnergy in the U.S.; MTU CFC Solutions in Europe; Marubeni Corporation in Asia; and Enbridge Inc. in Canada. FuelCell Energy developed its patented Direct FuelCell technology for stationary power plants with the U.S. Department of Energy through its Office of Fossil Energy's National Energy Technology Laboratory.

FuelCell Energy is also developing next generation high temperature fuel cell products, such as a diesel fueled marine Ship Service Fuel Cell, a combined-cycle DFC/Turbine(R) power plant and solid oxide fuel cells for applications up to 100 kilowatts. More information is available at http://www.fuelcellenergy.com.

This news release contains forward-looking statements, including statements regarding the Company's plans and expectations regarding the development and commercialization of its fuel cell technology. All forward- looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Factors that could cause such a difference include, without limitation, the risk that commercial field trials of the Company's products will not occur when anticipated, general risks associated with product development, manufacturing, changes in the utility regulatory environment, potential volatility of energy prices, rapid technological change, and competition, as well as other risks set forth in the Company's filings with the Securities and Exchange Commission. The forward-looking statements contained herein speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any such statement to reflect any change in the Company's expectations or any change in events, conditions or circumstances on which any such statement is based.