American Superconductor and Siemens Achieve Commercial-Grade Performance Levels for Superconductor Surge Protection Device for Power Grids.

Strategic Development and Commercialization Alliance Extended

WESTBOROUGH, Mass. and ERLANGEN, Germany -- American Superconductor Corporation (NASDAQ: AMSC), a leading energy technologies company, and Siemens AG (NYSE: SI), a global power systems company, announced today commercial-grade performance levels for a medium voltage superconductor surge protection device known as a fault current limiter (FCL). The device was based on Siemens' proprietary superconductor switching module technology, which utilizes coils fabricated with AMSC's proprietary 344S superconductors. Fault current limiters act as high-voltage surge protectors for power grids to increase grid reliability. The United States Department of Energy has estimated that the potential market for fault current limiters is several billion dollars over the next 15 years.

AMSC and Siemens also announced the extension for a third year of their strategic alliance, which is focused on the development and commercialization of fault current limiters for power transmission and distribution grids.

"We have made tremendous progress during the past two years through our collaboration with AMSC in developing a dynamic fault current limiter solution for utilities," commented Heinz-Werner Neumueller, Department Head of Siemens Corporate Technology. "Based on our new test results, our combined efforts have created an excellent prospect to develop a commercial fault current limiter that is able to suppress fault currents, enabling reliable expansion of power grids to meet the ever-increasing demand for electricity in cities around the world."

The successful test by AMSC and Siemens was conducted on a 2 mega-volt-ampere (2 MVA) FCL. The single-phase laboratory test was based on a superconductor switching module fabricated by Siemens from 344S superconductors. The system operated at a voltage of 7.5 kilovolts (kV), which corresponds to a 13-kV class of three-phase power equipment, widely used in utility distribution grids. It suppressed, or limited, the current during a fault by up to twenty-five times. Such limitation is increasingly important in urban grids where large fault currents, or current surges, arising from accidental, but common, short circuits can destroy power equipment if they are not adequately suppressed. The test results reported today are a critical step on the pathway to the development of commercially viable superconductor fault current limiters.

"Our new results show that fault current limiters are now able to achieve commercial performance levels needed for urban power grids," said Alex Malozemoff, executive vice president and chief technical officer of AMSC. "Aging power infrastructures are facing rapidly increasing demands for more electricity to meet customers' needs in our digital, plug-in economy. As new electricity generation sources are added to meet this demand, fault currents arising from short circuits are becoming dangerously large. Fault current limiters based on Siemens superconductor switching modules and AMSC's 344S superconductors will help utilities safely meet these growing electricity demands."

344S superconductors are smart materials because they possess unique physical properties that allow them to conduct electricity with no resistance under normal operating conditions, while also being able to recognize and then instantaneously suppress large surges of electrical current by switching to the resistive state. Suppressing spikes of electrical current is important because it prevents damage to expensive electrical equipment in power grids.

About AMSC's 344 Superconductors

AMSC's 344 superconductors, which have the architecture of what are generically known as second generation (2G) high temperature superconductor (HTS) wires, are designed as a drop-in replacement for customers who are currently using first generation (1G) HTS wire. The 344 superconductors comprise the basic 2G HTS wire architecture clad with ultra-thin strips of copper. When laminated with stainless steel, the product is known as 344S superconductors, which have made up more than 50% of AMSC's sales of 344 superconductors in the past 12 months. 344 superconductors offer significantly higher power density and efficiency compared with similar copper-based wire products. As a result, electrical systems that incorporate HTS wire are dramatically smaller, lighter and more cost effective than comparable systems based on copper wire. Applications for HTS wire include power transmission and distribution cables, propulsion motors and generators, degaussing cable systems, synchronous condensers and fault current limiters. For more information about American Superconductor's HTS products, please visit: http://www.amsuper.com/products/htsWire/2GWireTechnology.cfm.

About Siemens Corporate Technology

In the fiscal year 2005/2006, Siemens invested 5.7 billion euros in research and development -- which amounts to more than 26 million euros per work day. Worldwide, approximately more than 48,000 researchers and developers work on the newest technologies. With 62,000 current patents, the company is a world leader. Within the corporate department, Corporate Technology (CT), over 2,500 employees work worldwide on key and profile technologies that have a significant role in managerial areas. In addition, CT is responsible within Siemens for global patent management, environmental protection and work with international standardization bodies as well as for the Corporate Information Research Center. Further information about CT is available on the Internet at http://www.siemens.com/corporate-technology.

About AMSC

AMSC (American Superconductor Corporation - NASDAQ: AMSC) is a leading energy technologies company. The company develops and sells a wide range of products and solutions based on high temperature superconductor (HTS) wires and power electronic systems that dramatically improve the efficiency and quality of electricity during its generation, transmission, distribution and use. The company is a dominant force in alternative energy, offering grid interconnection solutions as well as licensed wind energy designs and electrical systems. As the world's principal supplier of HTS wire, AMSC is enabling a new generation of compact, high-power electrical products, including motors, generators, power cables, grid-level surge protectors, and advanced transportation and defense systems. AMSC also provides utility and industrial customers worldwide with voltage regulation systems that dramatically enhance power grid capacity, reliability and security, as well as industrial productivity. The company's technologies are protected by a broad and deep intellectual property portfolio consisting of hundreds of patents and licenses worldwide. More information is available at www.amsuper.com.

American Superconductor and design, Revolutionizing the Way the World Uses Electricity, AMSC, Powered by AMSC, SuperVAR, D-VAR, DVC, PQ-IVR, PowerModule and Windtec are trademarks or registered trademarks of American Superconductor Corporation.

Any statements in this release about future expectations, plans and prospects for the company, including expectations regarding the future market size for FCLs, the cost savings generated by FCLs, the ability of Siemens and AMSC to commercialize these products, and other statements containing the words "believes," "anticipates," "plans," "expects," "will" and similar expressions, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. There are a number of important factors that could cause actual results to differ materially from those indicated by such forward-looking statements. Such factors include: uncertainties regarding the company's ability to obtain anticipated funding from corporate and government contracts, to successfully develop, manufacture and market commercial products, and to secure anticipated orders; the risk that a robust market may not develop for the company's products; the risk that strategic alliances and other contracts may be terminated; the risk that certain technologies utilized by the company will infringe intellectual property rights of others; the competition encountered by the company. Reference is made to these and other factors discussed in the "Risk Factors" section of the company's most recent quarterly or annual report filed with the Securities and Exchange Commission. In addition, the forward-looking statements included in this press release represent the company's views as of the date of this release. While the company anticipates that subsequent events and developments may cause the company's views to change, the company specifically disclaims any obligation to update these forward-looking statements. These forward-looking statements should not be relied upon as representing the company's views as of any date subsequent to the date this press release is issued.