NEW DURHAM, N.H., July 24, 2000—Powerspan Corp., an emerging energy technology company, announced today that the Company has closed on over $26 million in new financing from a group of investors including FirstEnergy Corp., The Beacon Group, American Electric Power (AEP), Calvert Group, and Zero Stage Capital.

The new funding will be used to accelerate product development and commercialization. Today's announcement follows 2.5 years of aggressive development and pilot testing of a cost-effective, multi-pollutant control technology for coal-fired power plants. The patented technology, called Electro-Catalytic Oxidation^TM (ECO), provides the functionality of four separate control technologies in a single integrated system and produces valuable byproducts that become the feedstock for other industrial processes. With costs that are a fraction of alternative technologies, ECO addresses the need for producing clean, competitive power from existing coal-fired generating assets.

In pilot testing conducted since 1998 at FirstEnergy's R. E. Burger Plant near Shadyside, Ohio, two megawatts of flue-gas output were treated using ECO technology. Significant reductions in nitrogen oxides, sulfur dioxide, particulate matter, mercury, and other air toxics emissions have been demonstrated.

Powerspan and FirstEnergy are now engineering an $11.9 million commercial ECO installation for Spring 2001 at FirstEnergy's Eastlake Generating Station near Cleveland, Ohio. Successful completion of this demonstration will lead to the deployment of full-scale, commercial ECO systems.

"This new funding comes at a critical time and allows the Company to dramatically increase the resources dedicated to commercializing ECO technology. With these added resources, ECO should be available to help power generators achieve NOx reductions required on many midwestern coal-fired power plants to support the NOx SIP Call," said Frank R. Alix, chairman and CEO of Powerspan Corp. The NOx SIP Call is a requirement by the U.S. Environmental Protection Agency that calls for large scale NOx reductions from eastern and midwestern coal-fired power plants to meet National Ambient Air Quality Standards.

Powerspan will use a portion of the investment to support the Eastlake demonstration and to finalize product design for widespread commercial deployment on coal-fired power plants. The funds will also be used to further develop ECO technology for other applications, which include cost-effective emission control for gas-fired combustion turbines and stationary diesel generators.

Powerspan Corp. is engaged in the development and commercialization of innovative, proprietary energy technology for the global electric power industry. The Company is a pioneer in building cost effective and timely solutions for the existing power generating base. Company research and development efforts focus on unique applications of its proprietary electrotechnology to air emission control and water disinfection. Powerspan offers technology solutions to address the competitive needs of the new energy economy. More information on Powerspan is accessible at www.powerspancorp.com.

Powerspan Corp.
Contact: Stephanie Procopis, Director of Marketing
Phone: (603) 859-2500, ext. 20
Fax: (603) 859-2501
Email: sprocopis@powerspancorp.com
www.powerspancorp.com