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US$11 Million Grant from the U.S. Department of Energy for High-Temperature Superconductor Fault Current Limiters (`FCL')

(PresseBox) (Rheinbach, ) Trithor GmbH (`Trithor'), Rheinbach, Germany, a wholly owned subsidiary of Zenergy Power plc (AIM:ZEN.L) is pleased to announce that the U.S. Department of Energy has notified the Group's wholly owned subsidiary, SC Power Systems, Inc. (`SC Power'), San Mateo, California that it has been awarded an US$11million grant to design, test and install a high-voltage Fault Current Limiter (`FCL') in the Californian electricity grid. The FCL is a scaled up version of the Group's ground breaking power and proprietary grid stability device. The grant has been awarded to SC Power as leading and co-ordinating of a project team, the major participants of which include other members of the Group including Trithor, Los Alamos National Laboratory, Delta Star, Inc., Southern California Edison (`SCE'), California's largest utility, and the Consolidated Edison Company of New York, Inc. (`ConEd'), a subsidiary of Consolidated Edison Inc., one of the largest investor-owned energy companies in the United States.

An HTS FCL acts as a instantaneously (automated) resetting fuse that protects electrical power grids from damaging power surges, and is considered by the American Federal Government to be an essential component of future self-healing - or self-regulating - 'smart' electricity grids. Such `smart' grids are considered to be central to the much needed modernisation of America's national electricity grid, and rely on the deployment of a range of HTS devices. The grant is part of a US$51.8 million investment in HTS research projects announced by the United States Government aimed at establishing a diverse and stable supply of reliable, affordable and environmentally responsible energy. Investing in HTS FCLs is viewed by the American Government as an essential means of safeguarding energy efficiency and ensuring economic security.

A field test is expected to take place in the SCE grid, with Con Ed providing site selection support, specifications development and electricity grid testing.

As previously announced in April of this year, SC Power has already received a US$0.5 million grant from the California Energy Commission to install and test the Group's existing medium voltage FCL solution in California's electricity grid. This latest grant is for the subsequent installation and testing of a larger scale device designed specifically for the protection of higher voltage electrical grid equipment falling outside of the initial criteria of the Group's existing device. Both of these FCLs will be scaled up versions of prototypes previously and successfully built and tested by the Group.

The global market for FCLs is expected to be worth up to US$5bn per annum.

In awarding the grant, Secretary Samuel W. Bodman of the U.S. Department of Energy commented:

'Modernizing our congested and constrained electric grid - through the development of advanced, new technologies - is vital to delivering reliable and affordable power to the American people. As demand for electricity continues to grow, we must take steps now to identify potential problems, identify solutions, and deploy new technologies to provide a secure and steady energy supply. We look forward to the success of this research and recognize it will help us realize President Bush's goal of a more modern and efficient electricity system.'

Secretary Bodman's comments were made in a U.S. Department of Energy statement relating to this and other superconductor research grants:

DOE Provides up to $51.8 Million to Modernize the U.S. Electric Grid System - Superconductor Research Crucial to Improving Power Delivery Equipment

U.S. Department of Energy (DOE) Secretary Samuel W. Bodman today announced that DOE will provide up to $51.8 million for five cost-shared projects that will help accelerate much-needed modernization of our Nation's electricity grid. This research will advance the development and application of high-temperature superconductors, which have the potential to alleviate congestion on an electricity grid that is experiencing increased demand from consumers. Making investments to modernize our electricity grid; securing a diverse and stable supply of reliable, affordable and environmentally responsible energy; as well as increasing efficiency, are central to the Bush Administration's effort to increase energy and economic security.

'Modernizing our congested and constrained electric grid - through the development of advanced, new technologies - is vital to delivering reliable and affordable power to the American people,' Secretary Bodman said. 'As demand for electricity continues to grow, we must take steps now to identify potential problems, identify solutions, and deploy new technologies to provide a secure and steady energy supply. We look forward to the success of this research and recognize it will help us realize President Bush's goal of a more modern and efficient electricity system.'

The selected projects will help advance the future generation of power delivery equipment and aid the development of a highly efficient electricity grid system for the Nation. Two of the research projects will help increase reliability and efficiency of power delivery cables, and the remaining three projects will place an emphasis on fault current limiters. DOE's National Energy Technology Laboratory will manage these projects, which are expected to last two to five years. Projects will be equally cost-shared between DOE and selected teams, totalling $103.6 million in DOE/team project cost. DOE funding is expected to be allocated in Fiscal Years (FY) 2007-2012, subject to appropriations from Congress, with $10 million from FY2007, and $7 million requested in FY2008.

Selection of these projects allows DOE to build on its past successes in superconductivity, which include operating two distribution-level voltage superconducting cables and utility grids. Superconductors - solid ceramic compounds that conduct electricity more efficiently than traditional copper wires - can be a key to improving the capacity, efficiency, and reliability of electric power equipment. A major challenge prior to commercialization is to develop superconductors that can operate at relatively 'high' temperatures, from approximately -320 to -370 degrees Fahrenheit (50 to 77 Kelvin), and in magnetic fields from 1 to 4 Tesla.

DOE's Office of Electricity Delivery and Energy Reliability (OE) will oversee the research projects announced today. OE leads national efforts to modernize the electric grid; enhance the security and reliability of the energy infrastructure; and facilitate recovery from disruptions to the energy supply.

Selected projects are as follows:

FAULT CURRENT LIMITERS
SC Power Systems - (DOE cost share: $11 million)

On the Southern California Edison grid, SC Power Systems (San Mateo, CA) will design, test, and demonstrate a 138-kilovolt saturable reactor-type fault current limiter. In this type of fault current limiter, a high-temperature superconductor is used with a direct current power supply to saturate an iron core that interfaces with the line in which the current is to be limited. SC Power's team includes: Australian Superconductors Pty Ltd (Lucas Heights, NSW); DOE's Los Alamos National Laboratory (Los Alamos, NM); Air Products and Chemicals Inc. (Allentown, PA); Cryo-Industries of America Inc. (Manchester,NH); Consolidated Edison Company (New York, NY); California Edison Inc.(Rosemead, CA); Delta Star Inc. (San Carlos, CA); and Trithor GmbH (Germany).

American Superconductor - (DOE cost share: $12.7 million)

American Superconductor will also address the development and in-grid testing of a three-phase high-voltage, 115-kilovolt fault current limiter, called a SuperLimiterTM, by using second-generation wire. The SuperLimiterTM features a proprietary Siemens-developed, low-inductance coil technology that makes the fault current limiter invisible to the grid until it switches to a resistive state. The demonstration will occur at a location operated by team member Southern California Edison. The team also includes: Nexans (France), the University of Houston (Houston, TX), Los Alamos National Laboratory (Los Alamos, NM), and Siemens AG (Germany).

SuperPower Inc. - (DOE cost share: $5.8 million)

SuperPower Inc. (Schenectady, NY) will design, test, and demonstrate on the American Electric Power grid a 138-kilovolt fault current limiter that features a matrix design consisting of parallel 'second-generation' high-temperature superconductor elements and conventional coils. SuperPower's team includes: Sumitomo Electric Industries Ltd. (Osaka, Japan); Nissan Electric Co. Ltd. (Kyoto, Japan); The BOC Group Inc. (Murray Hill, NJ); American Electric Power (Gahanna, OH); and DOE's Oak Ridge National Laboratory (Oak Ridge, TN).

POWER DELIVERY EQUIPMENT

Southwire Company - (DOE cost share: $13.3 million)

Southwire Company (Carrollton, GA) will use a 13.8-kilovolt superconducting cable to connect two existing substation sites and solve a real-world electrical load problem near downtown New Orleans. The cable will connect the LaBarre and Metaire substations, owned by Entergy Corporation of New Orleans, LA, a member of Southwire's project team. The team also includes: DOE's Oak Ridge National Laboratory and nkt cables of Germany.

American Superconductor - (DOE cost share: $9 million)

American Superconductor Corporation (Westborough, MA) will develop the key components required to commercially deploy second-generation, high-temperature superconductor cables and demonstrate a single-phase prototype cable in the Long Island Power Authority power grid. In addition to the power authority, American Superconductor's team includes: Nexans (France) and Air Liquide Advanced Technologies U.S. LLC (Houston, TX).

About Zenergy Group plc

Zenergy Power plc is a global specialist manufacturer and developer of commercial applications for superconductive materials. Comprising three operating subsidiaries located in Germany (Trithor), USA (SC Power Systems) and Australia (Australian Superconductors), Zenergy is developing a number of energy efficient applications to be adopted in renewable energy power generation, energy distribution and large scale, energy intensive industrial processes.

About superconductivity

Superconductive materials are capable of conducting electricity without any resistance and were first discovered in 1911 in what was to prove to be one of the most significant scientific breakthroughs of the 20th century.

The global HTS market is substantial and growing, with a number of market studies projecting multi-billion dollar markets for the application of HTS materials and products. The proliferation of the use of superconductor materials is largely being driven by the following key factors:

(a) HTS materials are highly complementary to energy efficient technologies as a substitute for copper
(b) HTS wires have power densities of over 100x that of copper
(c) Current developments are leading to substantially reduced costs in the production of HTS wires and are targeting to be cheaper than copper over the next few years.
(d) HTS applications deliver exceptional energy efficiencies and thus reduced power consumption and running costs
(e) HTS technology is set to play a significant role in reducing CO2 emissions in line with international targets
(f) HTS applications are capable of delivering vastly increased levels of power with increased reliability and reduced material usage