News | August 21, 2001

Capstone MicroTurbines Generate Green Power For Los Angeles Department of Water and Power

LOS ANGELES, Aug 21, 2001 (BUSINESS WIRE) -- Capstone California, a wholly owned subsidiary of Capstone Turbine Corp.(Nasdaq:CPST), announced the installation of its largest commercial Capstone MicroTurbine(TM) landfill gas system to date is now completed at Los Angeles' Lopez Canyon landfill.

This 50-microturbine system, owned by the Los Angeles Department of Water and Power (LADWP), will convert methane gas collected at the site into 1.5 megawatts of electricity. In its entirety, this project will produce and send back to the grid enough electricity to power about 1,500 homes.

"The microturbine project will create energy from an innovative source and help reduce pollution," said David H. Wiggs, LADWP general manager. "LADWP is proud of this power plant. It shows that thinking outside conventional standards can bring about creative ideas to help us deal with both energy and ecological issues."

The project represents a unique partnership between the agency and the South Coast Air Quality Management District (SCAQMD).

The SCAQMD is the air pollution control agency for Southern California covering all of Orange County and the metropolitan portions of Los Angeles, Riverside and San Bernardino counties. Nearly half of the state's entire population, 15 million people, resides in this region.

Funds come from an LADWP commitment to spend $14 million on clean air projects in exchange for the right to exceed state air pollution limits while producing power for California's tight energy market.

The transformation of landfill methane gas into clean energy will eliminate 10,000 pounds of NOx emissions annually, or the equivalent of removing 500 cars from Southern California highways.

"This project is an example of how we as regulators are able to balance air quality requirements with economic needs during these challenging times," said Dr. William Burke, chairman of the SCAQMD.

Bob Fleet, senior vice president of Capstone California and project lead for the Lopez Canyon installation, stated: "Capstone MicroTurbine power generation systems are clean, simple and efficient energy solutions that can go online in months, not years. The forward-thinking leadership at LADWP and SCAQMD are using our technology to transform a source of pollution into valuable electricity homes and businesses can use, and that is good for everyone."

This is the largest landfill project undertaken by Capstone to date.

Capstone Turbine Corp.'s microturbine power systems are emerging as a practical and cost-effective technology for North American biogas applications from landfills to wastewater treatment plants and anaerobic digesters -- with this announcement coming just weeks after the city of Burbank commissioned a 10-unit system at its local landfill Aug. 2.

With this commission, Capstone now has almost 100 microturbines in place for biogas applications across North America. A development test site sponsored by the Los Angeles County Sanitation District at its Puente Hills landfill has proven invaluable in the development of this program.

The Capstone MicroTurbine is a versatile, highly efficient, quiet and environmentally beneficial solution for power generation that aims to be virtually maintenance-free and safety assured. The system uses scaled-down jet engine technology to generate electricity cleanly from a variety of gaseous and liquid fuels including propane, natural gas, diesel, kerosene and biogas.

Operating 90 percent cleaner than a diesel generator, the Capstone MicroTurbine is well under the low emission standards set by the SCAQMD for an ultra-clean generator, and impressed the SCAQMD so much that the district is now also a customer.

Mike Tingus, president of Capstone California, added: "Biogas applications are a natural market for our microturbine because waste gases that are otherwise flared into the atmosphere can be utilized essentially as free fuel for the system. The Capstone MicroTurbine can destroy these greenhouse gases more effectively than flaring, and the electricity generated can go back into the grid. It's good for the community, good for the environment and good for the utility."

The Capstone MicroTurbine has just one moving assembly, uses no oil, lubricants or coolants, and is designed to operate at full load 24 hours a day, 365 days a year. In California, traditional diesel generators, due to pollution concerns, are limited to less than 200 hours (about 8 continuous days) of operation per year. Several other states have similar limits.

Capstone MicroTurbines are not subject to such limitations, since they emit extremely low levels of nitrogen oxides. This enables businesses and public facilities to generate power onsite at a cost lower than peak rates while effectively conserving grid power when it is most important to do so.

Capstone Turbine Corp. (www.microturbine.com) (Nasdaq:CPST) -- winner of the Financial Times Energy's 2000 Global Energy Award for Most Innovative Commercial Technology -- is a leading producer of low-emission microturbine systems. In 1998, Capstone was the first to offer commercial power products utilizing microturbine technology, the result of more than 10 years of focused research.

Capstone Turbine has shipped more than 1,700 commercial production Capstone MicroTurbine systems to customers worldwide. These systems have logged more than 1 million hours of commercial operation serving, among others, the following applications:

-- Hybrid electric vehicles (HEVs): onboard generation.
-- Resource recovery: converting oilfield, landfill and sewage
waste gases into electricity.
-- Micro-cogeneration: combined heat/power/chilling solutions.
-- Power quality/reliability: arrays of microturbines that can
provide 99.9999 percent or higher reliability, compared with
99.9 percent levels offered by average utility power.

Capstone California, a wholly owned subsidiary of Southern California-based Capstone Turbine Corp., has headquarters in the Los Angeles suburb of Woodland Hills with satellite offices in Orange County, Sacramento and offices opening soon in San Diego and the Silicon Valley.

As a direct sales conduit, Capstone California offers one-stop turnkey expertise from site survey and custom application design to engineering consultation, full service project management and after sales support exclusively for the Capstone MicroTurbine family of products.

This news release contains "forward-looking statements," as that term is used in the federal securities laws, about Capstone's business, including statements regarding leadership in technology, market applications and operational capabilities. You can find many of these statements by looking for words such as "believes," "expects," "anticipates," "estimates," or similar expressions. These forward-looking statements are subject to numerous assumptions, risks and uncertainties that may cause Capstone's actual results to be materially different from any future results expressed or implied in such statements. These risks and uncertainties include those risks, uncertainties, marketplace competitors and risk factors identified, among other places, under "Business Risks" in Capstone's Form 10-Q for the quarter ended June 30, 2001. Capstone cautions you not to place undue reliance on these statements, which speak only as of the date of this release. Capstone undertakes no obligation to release any revisions to such statements to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.

Note: High-resolution photos are at:
www.microturbine.com/whatsnew/morephotos.asp?newsid=139

Note: LADWP announcement of this project is at
www.ladwp.com/whatnew/dwpnews/081601.htm

Note: Authorized reprints of Los Angeles Times and Los Angeles Daily News
articles on this project are at:
www.microturbine.com/whatsnew/pressrelease.asp?article=137

Note: Announcement of LADWP purchase of microturbines from Capstone California is at: www.microturbine.com/whatsnew/pressrelease.asp?article=67

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