N@N

Beacon Power Moves into Next Stage of DOE Loan Guarantee Process for 20-MW Flywheel Regulation Plant

^{Published on 2008-12-09 12:04:57 - Market Wire}
 

TYNGSBORO, Mass.--([ BUSINESS WIRE ])--Beacon Power Corporation (Nasdaq: BCON), a company that designs and develops advanced products and services to support more stable, reliable and efficient electricity grid operation, has delivered the last of nearly 100 separate documents in its application for a loan guarantee to the U.S. Department of Energy's Loan Guarantee Program Office and moved into the next stage of the process.

"We have been informed by the Loan Guarantee Program Office that we are now in the due diligence phase in the process. This is another important milestone on the path to building our first 20-MW frequency regulation plant in Stephentown, New York," said Bill Capp, Beacon president and CEO. "The DOE's information requirements were comprehensive, rigorously detailed and demanding, and our team did an excellent job in completing and submitting them all in a timely manner. We applaud DOE's efforts to help bring clean tech solutions like Beacon's flywheel regulation technology to commercial use. We look forward to completion of the DOE's review and to its subsequent decision."

Among the remaining elements in the process that the Company anticipates are completion of due diligence by DOE; review by the DOE Credit Review Board; the issuance of a term sheet to Beacon Power; and negotiation of a loan guarantee agreement. The loan associated with this program would provide the majority of financing for Beacon's proposed 20-megawatt regulation plant in Stephentown.

Loan Guarantee Program Seeks to Aid Commercialization of New Technologies

The DOE's Loan Guarantee Program was established pursuant to Title XVII of the Energy Policy Act of 2005. The Act authorized DOE to make loan guarantees for projects that "avoid, reduce, or sequester air pollutants or anthropogenic emissions of greenhouse gases; and employ new or significantly improved technologies as compared to commercial technologies in service in the U.S. at the time the issuance is guaranteed." The purpose of the Program is to expedite the deployment of new energy technology into commercial use in the U.S. and to reduce emissions of greenhouse gases and other air pollutants.

Beacon Power's proposed 20-MW regulation plant is based on non-polluting, flywheel-based energy storage technology that can provide the services now performed by conventional fossil-fuel regulation methods in a cleaner, faster and more cost-effective way. In October 2007, of 143 pre-application submissions, Beacon's project was one of just 16 invited to submit an application for loan guarantee consideration. Of these 16 projects, Beacon's is the only one selected in the "Electricity Delivery and Energy Reliability" category.

About Beacon Power

Beacon Power Corporation designs, develops and is taking steps to commercialize advanced products and services to support stable, reliable and efficient electricity grid operation. The Company's primary business strategy is to commercialize its patented flywheel energy storage technology to perform frequency regulation services on the grid. Beacon's Smart Energy Matrix, which is now in production, is a non-polluting, megawatt-level, utility-grade flywheel-based solution to provide sustainable frequency regulation services. Beacon is a publicly traded company with its research, development and manufacturing facility in the U.S. For more information, visit [ www.beaconpower.com ].

Safe Harbor Statements under the Private Securities Litigation Reform Act of 1995: This Material contained in this press release may include statements that are not historical facts and are considered "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect Beacon Power Corporation's current views about future events and financial performances. These "forward-looking" statements are identified by the use of terms and phrases such as "believe," "expect," "plan," "anticipate," and similar expressions identifying forward-looking statements. Investors should not rely on forward-looking statements because they are subject to a variety of risks, uncertainties, and other factors that could cause actual results to differ materially from Beacon Power Corporation's expectation. These factors include: a short operating history; a history of losses and anticipated continued losses from operations; a need to raise additional capital combined with a questionable ability to do so, especially in view of the current situation in the financial markets; the complexity and other challenges of arranging project financing and resources for one or more frequency regulation power plants, including uncertainty about whether we will be successful in obtaining DOE loan guarantee support for our New York facility; conditions in target markets, including the fact that some ISOs have been slow to comply with the FERC's requirement to update market rules to include new technology such as the Company's; our ability to obtain site interconnection approvals, landlord approvals, or other zoning and construction approvals in a timely manner; limited experience manufacturing commercial products or supplying frequency regulation services on a commercial basis; limited commercial contracts for revenues to date; the dependence of revenues on the achievement of product optimization, manufacturing and commercialization milestones; the uncertainty of the political and economic climate, and the different electrical grid characteristics and requirements of any foreign countries into which we hope to sell or operate, including the uncertainty of enforcing contracts, the different market structures, and the potential substantial fluctuation in currency exchange rates in those countries; dependence on third-party suppliers; intense competition from companies with greater financial resources, especially from companies that are already in the frequency regulation market; possible government regulation that would impede the ability to market products or services or affect market size; possible product liability claims and the negative publicity which could result; any failure to protect intellectual property, including the effect of the patent litigation initiated last year against us, which we recently settled; retaining key executives and the possible need in the future to hire and retain key executives; the historical volatility of our stock price, as well as the volatility of the stock price of other companies in the energy sector, especially in view of the current situation in the financial markets. These factors are elaborated upon and other factors may be disclosed from time to time in Beacon Power Corporation's filings with the Securities and Exchange Commission. Beacon Power expressly does not undertake any duty to update forward-looking statements.