KleenAir Set to Participate in U.K. Local Authority Fleet Retrofits.

Business Editors

FULLERTON, Calif.--(BUSINESS WIRE)--March 27, 2002

KleenAir Systems Inc. (OTCBB:KAIR), following its ongoing test program with the Borough of Hounslow, is now commencing a similar program with several other Local Authorities and government agencies in and around London and Manchester.

These Local Authorities have an active environment department established under U.K. Government Air Quality Management Area (AQMA) rules. Some 30 out of 33 London boroughs have voluntarily established such programs. Tests were recently conducted on city-owned vehicles in the Borough of Hounslow, including a Refuse Collection Truck and a 16 passenger Mercedes Benz Sprinter Mini-Coach.

The AQMA program, while voluntary, has been actively pursued and encouraged, by the Department of Transport, Local Government and Regions (DTLR). Various incentive programs for emission reduction on diesel-powered medium and heavy-duty vehicles have been put in place through vehicle license fees and Energy Savings Trust funding programs.

KleenAir has for sometime maintained ongoing communication and relationships with the DTLR and EST, an example of which is the current on road in-service London Taxi program.

Focusing attention on local authority fleets is part of KleenAir's strategy of launching its NOx reduction technology. They are especially motivated to "green" the fleets they control and to come to grips with NOx reduction mandates for their areas. In the United States, this is exemplified by the company's involvement in smog reduction efforts in Houston related to Federal NOx reduction requirements for that area.

Under the DTLR incentive program, thousands of vehicles owned by local authorities have already been equipped with particulate traps. Several U.K. cities have agreed to test the NOxMaster(R) System as a bolt-on retrofit to vehicles on which they have already installed such traps, thus reducing urban smog and the resultant health hazards. The results of KleenAir technology recently released by the City of Houston have clearly demonstrated very high levels of both NOx and particulate reduction when vehicles are equipped with both traps and the NOxMaster(R) System.

"By focusing on market segments with a mandated or strong voluntary program to improve air quality, we believe that we can deliver cost-effective solutions for environmental pollution at its source," said Lionel Simons, president of KleenAir Systems. "This should result in significant revenues from these segments commencing during the last quarter of 2002 and escalating during 2003."

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The statements contained in this release and statements that the company may make orally in connection with this release are not historical fact and are forward-looking statements within the meaning of the private securities Litigation Reform Act of 1995. Actual results may differ materially from those forward-looking statements, as such statements involve risks and uncertainties that could significantly impact the company's business and the actual outcome and results may differ materially.