Proton Receives Added Funding for Hydrogen Filling Station Development with University of Nevada Las Vegas Research Foundation

$1.9 Million Agreement Focusing on Safe, Efficient Hydrogen Fueling Technology

WALLINGFORD, Conn., Nov. 30 -- Proton Energy Systems, Inc., a subsidiary of Distributed Energy Systems Corp. , announced today that the company received its third consecutive award from the University of Nevada Las Vegas Research Foundation (UNLVRF) to continue its groundbreaking work on hydrogen fueling stations for automobiles and other motor vehicles. Proton is a leader in on-site hydrogen- generation systems and other advanced energy storage technologies.

This third phase, funded by the U.S. Department of Energy, allows Proton and UNLVRF to continue their collaboration that began in 2003 to develop advanced hydrogen fueling technologies. The award is valued at $1.9 million, including Proton cost share. The fueling station unit under development will be located at the Las Vegas Valley Water District, and technological investigations will be carried out both there and in Proton's central Connecticut facilities.

The fueling station's design is expected to incorporate a high-capacity electrolyzer, capable of generating up to 12 kilograms per day of hydrogen -- enough to fuel at least two fuel cell light duty vehicles. This electrolyzer will also incorporate higher-pressure capability, enabling the reduction of the downstream compression required to store high-pressure hydrogen onboard a vehicle. The high-pressure unit enables safe, fast and efficient hydrogen fueling that can compete with the way vehicles are filled using more traditional fuels. Hydrogen-powered vehicles are under development by major automotive and other companies.

The R&D project will also seek to add natural gas blending capability for compressed natural gas vehicles, which already exist in Las Vegas. Blending hydrogen with natural gas shows potential for reducing emissions without additional modifications to the vehicles.

Speaking on behalf of the UNLVRF, Tom Williams, its executive director, said: "The support we have received from Nevada's Senator Harry Reid and our teamwork with Proton over the past two years has enabled us to learn more about the technology and potential for hydrogen fueling, to begin to apply it in increasingly practical ways, and to help UNLV students become better at exploring and pinning down the energy-saving practicalities that hydrogen fueling promises."

Rob Friedland, Proton Energy's senior vice president, said: "By working on higher pressures and fuel-blending technologies with the exceptional UNLVRF research team, we expect exciting additional progress toward making the 'hydrogen highway' a proven and pragmatic reality, sooner rather than later."

About UNLVRF

The University of Nevada Las Vegas Research Foundation, a non-profit affiliate of the University of Nevada Las Vegas, was established in 2001 to facilitate commercialization of products and services resulting from UNLV faculty research, promote the scope of its research programs, and establish and implement strategies to stimulate economic growth and regional diversification originating from its research. The Foundation partners with UNLV research staff and a variety of organizations and businesses in an effort to bring the educational community together with the business community to explore opportunities in technology, research and development.

About Proton Energy Systems

Proton Energy Systems, Inc. is a leader in on-site hydrogen-generation systems and other advanced energy storage technologies. It is a subsidiary of Distributed Energy Systems Corp. , which creates and delivers products and solutions to the emerging decentralized energy marketplace, giving users greater control over their energy cost, quality, and reliability. For more information, visit http://www.protonenergy.com/ or http://www.distributed-energy.com/.