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A-Power Signs an MOU to Construct a New 290,000 Square Foot Wind Turbine Production Facility in Inner Mongolia - Local Government Agrees to Promote A-Power Turbines and Generate Orders

Posted on: Monday, 14 July 2008, 09:01 CDT

A-Power Energy Generation Systems, Ltd. (NASDAQ:APWR) ("A-Power"), announced today that it has entered into a Memorandum of Understanding with the Bayan Nur city government in western Inner Mongolia Autonomous Region to construct a new 290,000 square foot wind turbine production facility with the capacity to produce approximately 800MW of wind turbines each year. A-Power intends to produce its 2.5MW and 750kW wind turbines in this facility. Based on market demand and the wind conditions in this region, A-Power also anticipates future production of 1.5MW wind turbines in this facility and is in discussions to license or acquire 1.5MW wind turbine technology.

As part of the agreement, the Bayan Nur city government will also provide A-Power with tax breaks and coordinate all of the sales efforts for A-Power's wind turbines with wind farms in Bayan Nur and surrounding areas. Bayan Nur is located in one of the three premium wind belts in China and therefore, significant demand for wind turbines exists from wind farm operators in this region. The PRC central government has recently approved wind farms with a potential 2,100MW of output in Bayan Nur alone.

Mr. Jinxiang Lu, A-Power's Chairman and CEO, commented, "We are excited to announce the signing of this MOU with the Bayan Nur government and feel this expansion is a significant event that will continue to elevate our status and wind turbine production footprint in China. The Bayan Nur government has made us a generous offer and we are very excited to work closely with them to provide high quality wind turbines to operators and investors in this region.

"The new facility will be similar in size to the first phase of our facility recently completed in Shenyang and its strategic location will be advantageous to serve this particular part of Inner Mongolia's wind belt. We plan to begin construction on this facility in October 2008 and it is expected to be completed in July 2009 at a cost of approximately $20 million.

"The 800MW annual wind turbine production capacity at this new Inner Mongolia facility combined with over 1,000MW from the first phase of our Shenyang production facility will give A-Power an annual wind turbine production capacity of over 1,800MW by the end of 2009."

About A-Power

A-Power Energy Generation Systems, Ltd., through its PRC operating subsidiary, Liaoning GaoKe Energy Group Co., Ltd., is the largest provider of distributed power generation systems in China and will enter into China's wind market in 2008. The Company is also focused on developing and commercializing additional renewable energy technologies and has strategic relationships with both Tsinghua University and the China Sciences Academy in Guangzhou.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, about A-Power. Forward-looking statements are statements that are not historical facts, including statements relating to expected wind turbine orders and production output. Such forward-looking statements, based upon the current beliefs and expectations of A-Power's management, are subject to risks and uncertainties, which could cause actual results to differ from the forward-looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: business conditions in China; continued compliance with government regulations; legislation or regulatory environments, requirements or changes adversely affecting the businesses in which A-Power is engaged; cessation or changes in government incentive programs; fluctuations in customer demand; management of rapid growth and transitions to new markets; intensity of competition from or introduction of new and superior products by other providers of distributed power generation and other energy generation technology; timing, approval and market acceptance of new product introductions; general economic conditions; geopolitical events and regulatory changes, as well as other relevant risks detailed in A-Power's filings with the Securities and Exchange Commission. The information set forth herein should be read in light of such risks. A-Power does not assume any obligation to update the information contained in this press release.

Source: Business Wire

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