Telkonet Awarded Department of the Navy Approval to Support Worldwide Navy Marine Corps Intranet.

GERMANTOWN, Md. -- Telkonet, Inc. (AMEX:TKO), the leader in providing powerline carrier (PLC) networking solutions using existing electrical wiring, today announced that after extensive testing, validation and field deployment of its patented Telkonet iWire System(TM) powerline networking platform, the Department of the Navy and Electronic Data Systems (NYSE:EDS) approved the Company's FIPS 140-2 government certified networking solution for use within the extensive Navy and Marine Corps Intranet (NMCI) computing environment.

Ronald W. Pickett, President and CEO of Telkonet, Inc. commented on this significant milestone, "Telkonet has invested a significant amount of time, capital and creative energy to deliver and certify the secure Telkonet iWire System networking platform for NMCI use. We are proud to be the only powerline communications solution to secure such a significant competitive advantage within the Department of the Navy and the Department of Defense and look forward to building upon our relationship with EDS and its partners to support the delivery of high-speed communications in one of the largest, most secure enterprise network in the world."

Awarded to EDS in October 2000, the $6.9 billion government program was designed to unify thousands of disparate Navy and Marine Corps computer applications, networks and peripherals throughout the world into one secure, enterprise-class computing platform. In March 2006, EDS was awarded a contract extension for NMCI through 2010.

Telkonet's Government Systems team will continue to work closely with the Navy, Marine Corps, EDS and its NMCI partners to enable the Telkonet iWire System networking solutions where ever it is appropriate within the approximately 400,000 Navy and Marine Corps users across a wide range of deployments including: occupied commercial spaces, temporary locations, disaster recovery areas, historic locations, low-density facilities, remote locations and very small work sites.

About the Navy and Marine Corps Intranet

The Navy Marine Corps Intranet (NMCI) provides the Department of the Navy with a full range of network-based information services on a single, enterprise-wide intranet. Through NMCI, the Navy and Marine Corps will gain secure, universal access to integrated voice, video and data communications. The common environment will improve security across the enterprise, periodically integrate the most up-to-date commercial technologies and centralize information technology budgeting and expenditures for the department.

Eventually, the massive NMCI network will link more than 400,000 workstations and laptops for 500,000 Navy and Marine Corps users across the continental United States, Hawaii, Cuba, Guam, Japan and Puerto Rico.

About Telkonet

Telkonet develops and markets technology for the high-speed transmission of secure voice, video and data communications over in-premise and shipboard electrical wiring. The revolutionary Telkonet iWire System(TM) utilizes proven powerline communications (PLC) technology to deliver commercial high-speed broadband access from an IP "platform" that is easy to deploy, reliable and cost-effective by leveraging a buildings existing electrical infrastructure. The Telkonet iWire System can be installed rapidly and offers a viable and cost-effective alternative to the challenges of hardwiring and wireless local area network (LAN) deployment. Telkonet's products are designed for use in commercial and residential applications, including multi-dwelling units and the hospitality and government markets. Applications supported by the Telkonet "platform" include but are not limited to: VoIP telephones, Internet connectivity, local area networking, video conferencing, closed circuit security surveillance and a host of other information services. For more information, please visit www.telkonet.com.

Statements included in this release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve a number of risks and uncertainties such as competitive factors, technological development, market demand and the Company's ability to obtain new contracts and accurately estimate net revenues due to variability in size, scope and duration of projects, and internal issues in the sponsoring client. Further information on potential factors that could affect the Company's financial results can be found in the Company's Registration Statement and in its Reports on Forms 8-K filed with the Securities and Exchange Commission (SEC).