September 2005

Aluminum smelter provided with green electricity

Danbury, CT— FuelCell Energy, Inc., a developer of ultra-clean electric power plants, and its partner Alliance Power Inc., a consultant in citing economical and environmentally friendly distributed generation facilities, announced the signing of a contract to provide 500-kilowatts (kW) of green electricity to a secondary aluminum smelter in southern California that will meet or exceed the region’s tough air pollution standards.

Electricity produced by two 250-kW Direct FuelCell(R) (DFC(R)) power plants will be sold to TST, Inc., of Fontana, California, as part of a five-year power purchase agreement. Fuel cells provide the firm, 24/7 electricity that is appropriate for base load power requirements, which is critical for many industrial customers.

TST, a producer, trader and processor of aluminum, faces issues affecting many California industrials: increasing electricity costs cutting into profitability combined with stringent air pollution standards limiting access to on-site generation alternatives. With support from the South Coast Air Quality Management District (SCAQMD), TST is taking further control of its electricity needs with clean and efficient DFC power plants.

“Industrial customers in southern California are under mounting pressure to reduce emission of gases and particulates,” said Andrew Stein, CEO of TST. “We’re based in an area that has been the focus of a number of emissions initiatives. This project gives us an opportunity to take control of our energy sources with a market-priced source of electricity that actually decreases the amount of air-borne pollution.”

The DFC power plants are expected to be delivered to the TST site by the first quarter of 2006. Once the units begin operation, running on natural gas, their waste heat will be used to replace a large burner that preheats air as part of TST’s aluminum manufacturing process. The project is an outgrowth of SCAQMD, which issued a Request for Proposals to help reduce harmful emissions by industrial customers within its region.

Financial support for the fuel cell project includes up to $1.25 million from the California Public Utility Commission’s Self-Generation Incentive Program (SGIP), which encourages electrical customers to install distributed generation that operates on renewable fuel or contributes to system reliability.

Another $500,000 stems from SCAQMD, through funds accumulated through emissions penalties.

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