Clean Power Technologies Inc.
OTC Bulletin Board : CPWE
FRANKFURT : C1L

Clean Power Technologies Inc.

December 17, 2008 21:30 ET

Clean Power Signs MoU With Farm Fresh Marketing Inc. Third Agreement in North American Food Haulage Sector

CALGARY, ALBERTA--(Marketwire - Dec. 17, 2008) - Clean Power Technologies Inc. ("Clean Power" or the "Company") (OTCBB:CPWE)(FRANKFURT:C1L), developer of a unique heat recovery and hybrid power system to reduce vehicle emissions, is pleased to announce that it has signed a Memorandum of Understanding ("MOU") with Farm Fresh Marketing Inc. ("Farm Fresh"), a North American freight trucking company based in Idaho. Under the terms of the MOU, Farm Fresh will provide Clean Power a Road Load Data Collection Vehicle ("the Vehicle") for the purpose of detailed research on its existing refrigerated trailer fleet.

Both parties have agreed to work together with the ultimate objective of making the Farm Fresh truck fleet more energy-efficient by installing Clean Power's Clean Energy Storage and Recovery (CESAR) system, which takes otherwise wasted heat from the exhaust of a conventional combustion engine and modifies it through a heat recovery system to generate clean steam power for both motive and auxiliary power.

Abdul Mitha, President and CEO of Clean Power, said: "The transport industry is always at the front line in shouldering the brunt of ever escalating fuel prices. As is widely acknowledged, the increase in fuel costs has eaten into the industry's bottom line profit. Even with the current lower fuel prices, the industry is still reeling from the past higher prices. The industry had been operating at a bare bone profit margin. The transport and the grocery industries are looking to rein in their operating costs, and fuel savings will provide a good base to make the industry financial sustainable. Of course, trucks are traditionally not viewed as environmentally friendly but our technology is designed to address fuel efficiency and emission reductions in a substantive manner. Our heat recovery base technology is clean and effective. Our development program shows that the Clean Power's system will be a leader in the fuel efficiency and emission reduction technologies.

"Farm Fresh Marketing has been a long-distance transportation company for 25 years. We are delighted to be working with such a progressive-looking corporation and we are confident that our technology will generate direct economic and compliance benefits for our end users, as well as environmental benefits for us all."

Under the Memorandum of Agreement, and subject to a mutual agreement on a formal Distributorship Agreement, CPTI has granted a First Right of Refusal to Farm Fresh for non-exclusive Distributorships for the States of Idaho, Montana, Washington, Oregon, Utah, Colorado and Nevada.

Mr Herb Allen, President of Farm Fresh Marketing Inc, said: "Since establishing our business in 1983 we have never experienced such rapidly increasing fuel prices, which are now by far our biggest cost; well ahead of wages, capital equipment and maintenance combined. As an operator with 100 refrigerated food trailers, we could get a crucial competitive edge by using Clean Power's technology which provides a potential fuel savings of 40% per unit, whilst minimizing vehicle emissions and helping control ever-escalating grocery bills for consumers. We have looked at various other technologies to find effective and efficient solutions for fuel efficiency and emission reductions and feel Clean Power's heat recovery base technology offers practical answers. We are extremely grateful to be given early access to a technology that provides a step-change in fuel economy and environmental compliance, compared with the incremental benefits of the other options we have been exploring. We look forward to a long and successful cooperation with Clean Power."

Research using the vehicle is an important step towards understanding the operational and environmental performance parameters of the cooling units currently used in Farm Fresh's fleet of 53 trucks, all with refrigeration units on them. From this data Clean Power will refine the design and packaging of its exhaust heat capture, accumulator and steam engine to ensure that, together, they meet or exceed the specifications of the existing diesel engine system.

The overall global truck market is growing at 8% each year and there are already over 7 million refrigerated trailers in North America alone. These trucks and their refrigerated trailers, or 'reefers', are now subject to US anti-idling legislation, introduced in 2006 that prevents drivers from idling their engines for more than five consecutive minutes except in cases of maintenance or repair. As such, there is an immediate and significant market demand for hybrid technologies to power auxiliary systems in the truck cab (such as air conditioning, heating, lighting and entertainment) as well as refrigerated trailers. Clean Power's CESAR system requires no separate fuel source, no high-maintenance components, such as batteries or capacitors, and no major scientific or infrastructural step-changes (such as hydrogen for fuel cells).

CESAR's flexibility has enabled Clean Power to research and design a range of variants for different end applications - from cars and trucks to boats, and even military vehicles, where heat capture has anti-detection benefits. The solution proposed for Farm Fresh is a dual system unit which will operate when the truck is running with the refrigeration trailer attached, and also when the trailer is in stand-alone mode - for instance, keeping goods cool at a supplier depot or distribution centre.

In addition to initial cooperation on the Vehicle's data capture, loading and cycle analysis, the MOU also provides for future discussions, potential collaborations and commercial relationships surrounding the resulting CESAR system, subject to its development to the satisfaction of Farm Fresh.

ABOUT CLEAN POWER TECHNOLOGIES

Clean Power Technologies is committed to developing hybrid fuel technology and alternative fuel for a range of vehicles, including locomotives, heavy trucks and light cars. The Company's proprietary technology significantly reduces pollution through its Clean Energy Storage and Recovery (CESAR) system, which takes otherwise wasted heat from the exhaust of a conventional combustion engine and modifies it through a heat recovery system to generate clean power for the vehicle.

The Company boasts a highly experienced engineering team, whose vision and technical capabilities are driving the development and implementation of this unique hybrid fuel technology.

Clean Power Technologies operates out of its development facility in Newhaven, East Sussex. In 2006, testing of the CSEAR system began on a Mazda RX8 passenger vehicle engine, with trials on a second identical engine commencing later that year. In June 2007 testing also began on a Caterpillar C15 diesel engine to explore applications, such as auxiliary power and trailer refrigeration, within the industrial vehicle and truck industries. Testing on the CESAR process began in late October 2007, with initial results already recording a 40% improvement in fuel efficiency.

The Company listed on XETRA on the Frankfurt Stock Exchange in October 2006, and is also traded on the OTC Bulletin Board in the US.

About CESAR

Clean Power's Clean Energy Storage and Recovery (CESAR) technology is designed to increase vehicle fuel economy and reducing emissions by capturing, storing and reusing otherwise wasted heat from the exhaust of a conventional combustion engine. A heat exchanger captures waste energy, which is then stored in the form of steam in an accumulator, for 'on demand' use either in the same 'primary' engine, or in a secondary vapour engine. Power can be produced solely by the secondary vapour engine even after the primary combustion engine has shut down.

The CESAR system can be used to power auxiliary truck systems, such as trailer refrigeration and cab cooling or heating, in regulatory 'no idle' and 'quiet' zones. In addition to initial truck applications, CESAR can be further applied in Clean Power's well developed passenger car programme in addition to having longer-term potential in the locomotive and marine sectors.

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