FuelCell Energy Power Plants to Generate Renewable, Ultra-Clean Electricity at California Wastewater Treatment Facility.

Efficient Biogas-Fueled Plants Reduce Local Emissions

DANBURY, Conn. -- FuelCell Energy, Inc. (NasdaqNM:FCEL), a leading manufacturer of ultra-clean electric power plants for commercial, industrial and government customers, today announced that Dublin San Ramon Services District (DSRSD) has purchased two of its high efficiency Direct FuelCell[R] (DFC[R]) power plants to provide electric power to run its Regional Wastewater Treatment Facility located in Pleasanton, Calif. The DFC300MA power plants will generate 600 kilowatts of ultra-clean power and reduce harmful emissions by operating on fuel gas harvested from the waste treatment process.

The power plants are combined with an anaerobic digester -- equipment that creates and captures usable methane fuel during the wastewater treatment cycle -- and are expected to be installed next summer. Financial terms of the sale were not disclosed.

The wastewater treatment plant, in close proximity to residential areas, not only serves as a good neighbor by providing "green" power, it also enables the facility to meet the more stringent emission standards that the California Air Resources Board currently is proposing. Harmful emissions are reduced because, unlike most conventional power plants which combust fuel, DFC units convert the fuel electrochemically.

"By installing fuel cell power plants running on biogas we are able to help the community by reducing emissions and lessening the demand for power from the local grid," said DSRSD General Manager Bert Michalczyk. "And the wastewater treatment facility benefits from having onsite reliable 24/7 power that reduces the need for more expensive energy from the local utility. It's a compelling proposition for the people in the Dublin San Ramon Service District."

Heat from the fuel cell units will supply additional heat to the anaerobic digesters and boost the total thermal efficiency of this cogeneration application. Wastewater treatment facilities are an ideal application for DFC power plants because they can operate on anaerobic digester gas which is classified as a renewable fuel and are eligible for government incentive funding in many locations.

"The Dublin San Ramon power plant installation is FuelCell's 13th wastewater treatment project worldwide and the fifth in California. DFC plants are particularly well suited for wastewater treatment due to their ability to produce more electricity from the same amount of digester gas than the less efficient and higher polluting combustion technologies," said William A. Karambelas, Vice President of the Western Region at FuelCell Energy. "The operating efficiency of DFC power plants combined with our 24/7 reliability and superior emissions profile are important drivers for customers in this market."

The California Public Utilities Commission's Self-Generation Incentive Program (SGIP) has issued a reservation letter that provides incentive funding of approximately $2.7 million for this fuel cell installation. FuelCell Energy has applications totaling another $32.1 million and representing more than 8 megawatts approved for participation in the 2006 SGIP.

About FuelCell Energy, Inc.

FuelCell Energy develops and markets ultra-clean power plants that generate electricity with higher efficiency than distributed generation plants of similar size and with virtually no air pollution. Fuel cells produce base load electricity giving commercial and industrial customers greater control over their power generation economics, reliability and emissions. Emerging state, federal and international regulations to reduce harmful greenhouse gas emissions consider fuel cell power plants in the same environmentally friendly category as wind and solar energy sources -- with the added advantages of running 24 hours a day and the capacity to be installed where wind turbines or solar panels often cannot. Headquartered in Danbury, Conn., FuelCell Energy services over 50 power plant sites around the globe that have generated more than 124 million kilowatt hours, and conducts R&D on next-generation fuel cell technologies to meet the world's ever-increasing demand for ultra-clean distributed energy. For more information on the company, its products and its worldwide commercial distribution alliances, please see www.fuelcellenergy.com.

This news release contains forward-looking statements, including statements regarding the Company's plans and expectations regarding the development and commercialization of its fuel cell technology. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Factors that could cause such a difference include, without limitation, the risk that commercial field trials of the Company's products will not occur when anticipated, general risks associated with product development, manufacturing, changes in the utility regulatory environment, potential volatility of energy prices, rapid technological change, and competition, as well as other risks set forth in the Company's filings with the Securities and Exchange Commission. The forward-looking statements contained herein speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any such statement to reflect any change in the Company's expectations or any change in events, conditions or circumstances on which any such statement is based.