Technical Update - Milestones

ITM Power PLC
09 January 2007

9 January 2007



                                 ITM Power Plc
                            ('ITM' or 'the Company')

                         Technical Update - Milestones

ITM Power Plc announces today that it has successfully achieved its milestone
objectives set out for completion by the end of December 2006.  Taken together
these developments significantly advance the Company's strategic objectives of
developing products for field trial evaluation and subsequent production.

The achievement of these milestones underpins the Company's ability to seek
further commercial collaborators as they demonstrate ITM's electrolyser and fuel
cell equipment in real world environments.

Electrolyser Developments

The following achievements offer a route to producing and storing hydrogen in
commercially available cylinder systems for transportable applications.

  • A low cost 5kW electrolyser using ITM's Nickel/platinum technology, at a
    cost for the entire stack of less than $250 /kW:

ITM is pleased to announce that it has designed and constructed a dedicated
electrolyser module which has operated successfully using a transient load cycle
(30 minute on-load, 30 minute off), and that the projected production cost is
significantly less than the $250/kW target.  This target has been achieved
notwithstanding the recent increases in the cost of platinum.

  • A demonstration electrolyser operating at 20 bar (approximately 300psi):

ITM has constructed and operated an electrolyser using its materials and
catalyst systems at a pressure of 20 bar on a transient load cycle (30 minute
on-load, 30 minute off).

Conventional PEM materials are known to work at high pressure. However, ITM's
hydrophilic materials are unique so their operation at high pressure must be
demonstrated by practical testing. When operating in 'self-pressuring' mode some
part of the input energy is used to generate the pressure and this results in an
increase in the operating voltage. The voltage increase in the 20 bar ITM
electrolyser was entirely in accordance with theoretical estimates. In brief,
the Company has successfully demonstrated that its materials are not adversely
affected by operation at this pressure and that such an electrolyser can be used
to charge storage systems without necessarily requiring additional compression.

Fuel Cell Developments

  • A Dual Liquid Fuel Cell, to include a rapid refuelling cartridge and
    output power conditioning electronics able to operate electronic appliances:

A 5 cell fuel-cell-stack incorporating liquid fuel circulation systems and a
replaceable fuel cassette has been designed and tested in the laboratory. This
system has repeatedly achieved power outputs in excess of 4W net (after
providing power for the internal fuel circulating pumps). In addition, this
cell-stack has exceeded 10W during polarisation tests giving confidence that the
device can be significantly further developed.

For this reason, ITM has decided to bring forward the design of a fully packaged
device, engineered to pre-production standard, using the '4W' stack as the focus
of this development.

  • The development of a Hydrogen Oxygen fuel cell with an estimated
    production cost of less than $700/kW:

The Company is pleased to announce that it has succeeded in meeting the cost
reduction target for December 2006 of less than $700/kW if produced in
accordance with the assumptions set out previously on 18 October 2006. The
reduction in cost from $900/kW to $700/kW has been achieved by improving power
density per unit area of cell.

Future cost reductions are being sought principally through further increasing
the power density at which the ITM hydrophilic materials can operate, reducing
platinum loadings and/or the complete elimination of platinum.

Jim Heathcote, CEO, ITM Power Plc, comments:

'The achievement of these milestones is of great value to ITM. The ability to
self-pressurise hydrogen to these levels significantly expands the markets that
our electrolysers will be able to address. In addition, it is encouraging that
our hydrogen oxygen fuel cell cost reduction programme is continuing to make
progress. We are on track to achieve our objective of adding a low cost fuel
cell to our low cost electrolyser by December 2007.

We have an increasingly valuable portfolio of IP and demonstrable equipment
which will enable ITM to engage with partners to exploit commercial
opportunities offered by the advent of increasing oil prices and the pressure to
reduce pollution.'


Ends

For further information:

www.itm-power.com


Gemma Chandler
Corporate Communications Officer
ITM Power Plc
Tel: [phone]
Mob: [phone]


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