FuelCell Energy Power Plant to Generate Electricity, Provide Heat and

    Business Editors

    DANBURY, Conn.--(BUSINESS WIRE)--May 10, 2005--

SUNY's Internationally Recognized Center for Sustainable and Renewable
    Energy Takes Important Step toward Achieving State's Energy Mandate

    FuelCell Energy, Inc. (NasdaqNM:FCEL) today announced the sale of a 250-kilowatt Direct FuelCell(R) (DFC(R)) power plant to generate onsite electricity and provide residual heat for domestic hot water and heating at the State University of New York's College of Environmental Science and Forestry (SUNY-ESF) in Syracuse.
    The transaction, arranged by Milton Cat Inc., the Caterpillar(R) Inc. dealer representing the Syracuse area, includes site engineering and installation of the DFC300A power plant and related equipment. Caterpillar and FuelCell Energy have an alliance agreement to distribute and develop ultra-low emission fuel cell power generation products for industrial and commercial use. FuelCell Energy will provide maintenance under a long-term service agreement with SUNY-ESF. The fuel cell to be installed at SUNY-ESF is expected to provide about 5 percent of the campus's power.
    New York Gov. George E. Pataki previously announced this project would receive $1 million in funding from the New York State Energy Research and Development Authority (NYSERDA). The New York Power Authority (NYPA) also is participating as the purchaser of the fuel cell system and administrator on behalf of SUNY-ESF. The "ultra-clean" DFC power plant will play a key role in the campus's continuing efforts to meet and exceed the renewable power standards set forth in the Governor's Executive Order 111.
    "Combined heat and power systems can provide power to our colleges and universities more efficiently and with fewer environmental impacts than by conventional means," Gov. Pataki said. "New York State is leading by example when it comes to adopting advanced, clean-energy technologies and solutions that will protect our environment and preserve our energy resources. I have challenged State-owned facilities to improve their energy efficiency and begin purchasing power from renewable resources and I applaud SUNY-ESF for pursuing this option."
    The program also received financial support from the U.S. Department of Defense Climate Change Fuel Cell Program and the Electric Power Research Institute.
    Gov. Pataki issued Executive Order 111 in June 2001, directing State facilities to reduce energy use by 35 percent by 2010. It further directs facilities to purchase 10 percent of their power from renewable resources by 2005 and 20 percent by 2010. Under the order, fuel cells (including those operating on natural gas) qualify for the renewable energy requirement because they generate minimal emissions as a result of their electro-chemical process for generating electricity.
    State University of New York Chancellor Robert L. King said, "I applaud the Governor for his efforts in helping to make our campuses more energy efficient and environmentally friendly. Investing in energy-efficient power sources means important financial savings for our campuses. Dollars that are currently used to heat and light our campuses will become available to support other critical campus needs."
    Dr. Cornelius B. Murphy, Jr., ESF President, said, "Now is the time to take this important step aimed at eventually freeing New York from dependence on foreign oil while using our plentiful, domestic resources in environmentally friendly applications. Two important benefits of this fuel cell application is that it is more efficient than traditional power generating technologies and it produces electricity without combustion. By using 50 percent less fuel per kilowatt-hour of electricity, the fuel cell extends our domestic resources. Also, since it generates electricity without combustion, harmful greenhouse gas emissions are significantly reduced. The environmental characteristics of this fuel cell on natural gas are comparable with renewable technologies such as solar and wind."
    NYPA President and CEO Eugene W. Zeltman said, "This initiative is a result of Gov. Pataki's commitment to make the Empire State a leader in clean energy technology. NYPA has more than doubled its annual investments in energy efficiency and renewable power under the Governor's leadership, including scores of projects at SUNY campuses. In particular, the advanced fuel cell at ESF will offer excellent opportunities for research and teaching, which in turn will spark future innovations to supply New Yorkers with economical, environmentally sound energy."
    "We are investing $53 million in CHP/DG applications across New York State," said NYSERDA President Peter R. Smith. "The project at SUNY-ESF received $1 million in funding from NYSERDA. Under the leadership of Gov. Pataki, New York State is moving quickly toward its goal to increase the development and use of clean-energy technologies, such as fuel cells. This initiative at SUNY-ESF is a prime example of the types of projects that can aid in reaching our goals to help reduce harmful emissions and improve our environment, reduce our dependence on foreign fuel, increase energy security, and boost economic development."
    FuelCell Energy Chairman and CEO Jerry D. Leitman said, "We are extremely pleased to contribute to New York's innovative energy initiatives by providing an 'ultra-clean' DFC power plant for SUNY-ESF. This project is evidence that with strong government support, stationary fuel cell power plants can save institutions on their energy costs while meeting the State's efficiency and renewable mandates."
    SUNY-ESF has been a leader in commercial applications of renewable resources since 1911. The school's national and international academic, scientific and engineering reputation for expertise in this area consistently serves as a benchmark. Since 2002, SUNY-ESF has been designated the SUNY Center for Sustainable and Renewable Energy, a clearinghouse for renewable energy issues and research for the entire 64-campus SUNY-system. In his 2004 and 2005 State of the State speeches, Gov. Pataki recognized these institutions, citing their leadership in the expanded renewable energy mission of the Syracuse Center of Excellence in Environmental and Renewable Energy Systems.
    This is the fourth DFC power plant for a university in the United States. Other DFC university sites include Yale University in Connecticut, Ocean County College in New Jersey, and Grand Valley State University in Michigan. The combined heat and power potential for colleges and universities in four northeastern states (Connecticut, Massachusetts, New Jersey and New York) exceeds 500 megawatts.

    About SUNY
    The State University of New York is the largest comprehensive university system in the United States educating nearly 413,000 students in 6,688 degree and certificate programs on 64 campuses. More information is available at http://www.suny.edu.

    About Caterpillar
    For 80 years, Caterpillar Inc. has been building the world's infrastructure and, in partnership with its worldwide dealer network, is driving positive and sustainable change on every continent. With 2004 sales and revenues of $30.25 billion, Caterpillar is a technology leader and the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. More information is available at http://www.cat.com.

    About FuelCell Energy
    FuelCell Energy, Inc., based in Danbury, Conn., is a world leader in the development and manufacture of high temperature fuel cells for clean electric power generation. The company has developed commercial distribution alliances for its carbonate Direct FuelCell products with world class companies such as PPL Energy Plus, Caterpillar, Alliance Power, Chevron Energy Solutions and LOGANEnergy in the U.S.; Marubeni Corporation in Asia; MTU CFC Solutions in Europe; 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.
    The sub-megawatt DFC fuel cell power plant is a collaborative effort using Direct FuelCell(R) technology of FuelCell Energy and the Hot Module(R) balance of plant design of MTU CFC Solutions, GmbH, a subsidiary of DaimlerChrysler. 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 through its investment in and partnership with Versa Power Systems 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.

--30--KK/ny*

CONTACT: FuelCell Energy, Inc. Steven P. Eschbach, CFA, 203-825-6000 seschbach@fce.com

KEYWORD: CONNECTICUT NEW YORK INDUSTRY KEYWORD: REAL ESTATE BUILDING/CONSTRUCTION ENERGY UTILITIES MANUFACTURING MARKETING AGREEMENTS SOURCE: FuelCell Energy, Inc.

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