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American Superconductor Reports Increasing Demand for 344 Superconductors Used in Fault Current Limiter Applications.

Majority of 344 Superconductor Shipments are for Fault Current Limiters

Demand for Increased Power Grid Reliability Driving Accelerated Product Development Efforts by AMSC and its Customers

WESTBOROUGH, Mass. -- American Superconductor Corporation (NASDAQ: AMSC), a leading energy technologies company, announced today that a majority of the second generation (2G) high temperature superconductor (HTS) wire - known as 344 superconductors - being shipped by AMSC in its current fiscal year ending March 31, 2007 is being used in the development of fault current limiters. Fault current limiters act as high-voltage surge protectors for power grids to increase grid reliability.

"Fault current levels are posing significant challenges in many utility grids around the country and have the potential to cause widespread brownouts and blackouts," said Syed Ahmed, consulting engineer, transmission and distribution business unit of Southern California Edison. "HTS fault current limiters are a unique solution that will help address and accommodate projected load growth, without endangering our grid operations."

344 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.

"The race for market leadership in HTS fault current limiters is on. There has been strong demand for fault current limiters among domestic and overseas utilities, and, with our 344 superconductors now available, we are beginning to capitalize on this significant business opportunity," said Greg Yurek, chief executive officer and founder, American Superconductor. "In addition to our own fault current limiter product development effort with Siemens, at least seven other electrical equipment developers in four countries are now utilizing 344 superconductors to develop fault current limiters. This is a vast new market opportunity for HTS that the U.S. Department of Energy forecasts to be in the billions of dollars."

About Fault Current Limiters

When a short circuit occurs in an electrical transmission or distribution system, an electrical generator feeding power into that system responds by creating a surge of current throughout the grid. As additional capacity is added, these surges can exceed the current rating of the circuit breakers that are conventionally used to protect the valuable equipment located throughout the grid. It is estimated that without adequate protection these power surges would cost electric utilities hundreds of millions of dollars a year in equipment damages. An FCL uses high temperature superconductors to instantaneously limit electrical surges, or reduce them to levels that can be handled by existing circuit breaker. Particularly in the high voltage transmission grid, there is no alternative outside of rewiring the grid at enormous cost.

For more information on American Superconductor's FCL technology please visit: .

About American Superconductor's 344 Superconductors

AMSC's 344 superconductors are a drop-in replacement for customers currently using first generation (1G) HTS wire. The 344 superconductors comprise 2G HTS wire clad with ultra-thin strips of copper or stainless steel. 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. The 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: .

About American Superconductor Corporation (NASDAQ:AMSC)

AMSC is the world's principal vendor of high temperature superconductor (HTS) wire and large rotating superconductor machinery, and it is a world-leading supplier of dynamic reactive power grid stabilization products. AMSC's HTS wire and power electronic converters are at the core of a broad range of new electricity transmission and distribution, transportation, medical and industrial processing applications, including dynamic reactive power grid stabilization solutions, large ship propulsion motors and generators, smart, controllable, superconductor power cables and advanced defense systems. The company's products are supported by hundreds of patents and licenses covering technologies fundamental to Revolutionizing the Way the World Uses Electricity[R]. More information is available at

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

Any statements in this release about future expectations, plans and prospects for the Company, including the potential market demand for fault current limiters, AMSC's ability to ship its 344 superconductors in a timely manner 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 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, including several large Japanese companies. Reference is made to these and other factors discussed in the "Management's Discussion and Analysis of Financial Condition and Results of Operation" 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.
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Publication:Business Wire
Date:Nov 16, 2006
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