VRB Power provides update on its Small Systems (flow batteries)

[skids]

It appears their first production scale product will be a 5KW unit with flexible
storage in the range of one to several hours.

- Recent 5kW x 4hr VRB-ESS(TM) sales have been made to the University
of Aalborg in Denmark for evaluation in renewable (off grid wind and
solar) applications and to Edison SPA in Italy for evaluation in
Italian telecoms back-up applications;
- 10 pre-production 10kWh systems and one 30kW x 2hr system were
shipped in 2006. All of these systems have been commissioned and are
either being tested in laboratory or in the field;

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- The costs of the commercial 5kW systems have been significantly
reduced from the pre-commercial version and are in line with expected
cost reductions;
- The commercial 5kW VRB-ESS(TM) will be unveiled in Chicago in June,
2007 at the NxtComm Show;


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"I am pleased with the work that has been done by our engineering team in
developing a commercial 5kW multi-hour system, which provides a flexible, easy
to customize solution for our customers and which, at target pricing, will
generate positive margins on launch in mid 2007," said Tim Hennessy, CEO of
VRB Power Systems. "I am also pleased with how our pre-production systems have
operated so far in laboratory and field testing in a variety of applications
and I am encouraged by customer feedback. This, together with the work that
our sales team and channel partners have done in marketing and positioning
these systems in our target markets, gives me confidence that, once the
testing / evaluation phase of this product is concluded, we will generate
significant sales for this product. We continue to expand our assembly
capability at our Richmond facility and remain on track to have the capacity
to assemble 2,500 5kW cell stacks per shift per year from the end of 2007,"
concluded Hennessy.