West Babylon, NY – April 24, 2002 – Taking another step forward in its program to develop the use of fuel cell power systems as part of its energy technology mix, the Long Island Power Authority (LIPA) announced today that it will begin the installation of 17 Plug Power Inc. (NASDAQ: PLUG) fuel cells at several commercial and municipal customer locations on Long Island this summer.
The 5-kW fuel cells will be interconnected to LIPA’s grid and will operate in a combined heat and power mode, providing electricity and heat on-site at select LIPA customer locations. Operation of these systems, which will be powered by natural gas, will enable evaluation of the integration of fuel cells at the specific point of need.
By the end of 2002, LIPA also will install three 5-kW DC backup power systems, operating on hydrogen, at facilities on Long Island. This will allow an initial assessment of fuel cells as a backup generation source.
LIPA also will expand the operation of fuel cells connected to the electric grid at its West Babylon substation through introduction of Plug Power fuel cell systems that have increased life and functionality. The deployment of Plug Power’s stationary unit (2002 design) at the West Babylon site will support continued assessment of fuel cell integration into the existing utility electric grid and development of remote dispatch capability for distributed power sources.
"We have been eager to develop fuel cell technology as an alternative to the more traditional form of electricity generation," said LIPA Chairman Richard M. Kessel. "Over the last two years, we have developed firsthand knowledge of how fuel cells can be integrated directly into our electric grid. The ongoing operations at West Babylon have helped us to understand the value of fuel cells for on- site power generation. This next and very important step will help us better understand the issues associated with the integration of fuel cells at customers’ facilities where heat produced by the units can also be used."
"Our success to date extends to LIPA’s partnership with the Town of Babylon and our ability to train and develop a network of individuals who will be able to support fuel cell technology as it becomes available in the marketplace," said Mr. Kessel. "Therefore, the Town will be the first to receive new units as they arrive. The West Babylon units will produce electricity for on-site use, and heat produced by the systems will be used to heat water in Town Hall."
"LIPA’s continued use of fuel cells to meet Long Island’s growing demand for electricity represents a significant part of its distributed generation portfolio," said Plug Power President and Chief Executive Officer Roger Saillant. "Chairman Kessel’s commitment to meet the needs of LIPA’s customers, and the vision and focus to install clean energy solutions directly at customer sites places LIPA at the forefront of the development of distributed generation."
At the request of Governor George Pataki, LIPA’s involvement in the development of fuel cell technology began in 2000 when it field tested six Plug Power fuel cells at locations on Long Island to gain operational experience that has supported the evolution of grid interconnected fuel cell systems. In 2001, LIPA constructed a 3-acre site at its substation in West Babylon. Seventy-five Plug Power fuel cell systems were commissioned in late 2001 and have generated in excess of 150,000-kilowatt hours. These fuel cells are currently being operated and maintained by Elemco Testing Company, Inc. of Bohemia. Elemco technicians were trained by Plug Power in the operation and maintenance of fuel cells and have responsibility for the ongoing operation of the West Babylon site under contract to KeySpan Energy.
Funding for this new $3.6 million contract is being provided under LIPA’s Clean Energy Initiative (CEI). The CEI is a five-year, $170 million program, originally proposed by Governor Pataki, designed, in part, to foster the development and application of clean energy technologies including fuel cells. More information on LIPA’s CEI programs can be found on its Web site at www.lipower.org.
Plug Power designs and develops on-site electric power generation systems utilizing proton exchange membrane fuel cells for stationary applications. Plug Power’s fuel cell systems are expected to be sold globally through a joint venture with General Electric and through DTE Energy Technologies in a four-state territory, which includes Michigan, Illinois, Ohio and Indiana. The Company’s headquarters are located in Latham, N.Y., with offices in Washington, D.C., and The Netherlands.
LIPA owns the retail electric system on Long Island, and provides electric service to nearly 1.1 million customers in Nassau and Suffolk counties, and the Rockaway Peninsula in Queens. LIPA does not provide natural gas service.
