MTI Micro Fuel Cell Delivers on Energy Density Milestone

June 26, 2006

A 30 percent increase in fuel efficiency
Successful completion of second quarter milestone

ALBANY, N.Y., June 26 — MTI MicroFuel Cells Inc. (MTI Micro), the developer of the award-winning Mobion® micro fuel cell technology and a subsidiary of Mechanical Technology Incorporated (Nasdaq: MKTYNews), announced today that it has achieved an energy density of over 1.3Wh per cc of fuel on a 30 Watt Mobion® laboratory test unit. This significant achievement represents more than a 30% increase in fuel efficiency and is an important technical milestone as MTI Micro moves forward in developing Mobion® products for a range of applications targeted for the military market.

“Achieving both fuel efficiency and power together in the same lab unit is key to making lighter and smaller products with longer run-times than batteries,” said Russel Marvin, Chief Operating Officer of MTI Micro. “This is an important step in our DMFC development efforts.”For the military markets, MTI Micro is focusing its proprietary Mobion® technology along two separate platforms — a 30 Watt high power platform, and a 1 Watt low power platform — both targeting key portable applications used in day-to-day military operations.

“We recognize what our military customers need — a rugged, light, compact, power-pack that can work in most operational environments, and run longer than batteries,” said Juan Becerra, Vice President of Market and Business Development for MTI Micro. “We are focused on developing products that can meet those requirements and improve the mobility, and effectiveness of our soldiers.”

For high power applications, MTI Micro’s unique direct methanol fuel cell (DMFC) system, Mobion®-30, is being designed to produce up to 30 Watts of continuous power in a portable, light-weight, energy-rich, power-pack allowing deployed soldiers to continue the use of multiple portable electronic devices such as communication radios, satellite equipment, laptops, and GPS devices for much longer periods of time. The Mobion®-30 system is expected to eliminate the need to carry multiple battery types and the constant swapping of batteries during the course of a mission. In addition, the Mobion®-30 may help reduce military operational and logistics costs of tracking, shipping and disposing of millions of batteries.

“The latest accomplishments in fuel cell efficiency by MTI Micro are very exciting to AFRL. In particular, these results bode well for the man-pack communications satellite equipment that is being developed by AFRL at this time,” said William Cook, Senior Engineer at the Air Force Research Laboratory Information Directorate. “The recent MTI Micro accomplishments will allow for great reductions in the weight of the power system needed to operate the satellite equipment. This is critical for the dismounted soldier. AFRL is anxious to incorporate the MTI fuel cell technology and is looking forward to working with MTI Micro in this area.”

When compared to batteries required for a 72 hour mission, the Mobion®- 30 and two of its easy-to-swap, 100% methanol cartridges are expected to weigh less than one-half the weight of currently used batteries — a critical parameter for deployed soldiers in the field who have to make trade-offs between carrying batteries and other essential gear like ammunition, food and water.

In the low power military space, MTI Micro’s proprietary Mobion® technology, Mobion®-1 is designed to produce 1 Watt of continuous power and is intended for applications with minimal power needs, but continuous, unattended run-time. Possible applications for our Mobion®-1 range from powering sensors for surveillance and monitoring equipment along U.S. borders for homeland defense to deploying sensors in enemy territory for surveillance and combat operations where changing batteries is not desirable.

As part of its military market entry strategy, MTI Micro has met a number of milestones in 2005 and has forged strategic relationships to initially penetrate this market. MTI Micro is currently working on a project for the US Army as part of a contract with Saft America to jointly develop a hybrid system combining Mobion® fuel cells and Li-Ion battery technology, and is also working on the delivery of fuel cell evaluation kits to the Air Force Research Laboratory in Rome, New York.

“I am very pleased with the progress achieved by MTI Micro in the past few months with the completion of this second quarter milestone on the technical side and in connection with our efforts in the consumer market with the initiation of our alliance with Samsung Electronics,” said Peng Lim, CEO of MTI Micro. “This progress certainly brings us a step closer to our ultimate goal – making Mobion® a standard power source used for powering all types of mobile products in military, industrial, and consumer applications.”

About MTI MicroFuel Cells

MTI MicroFuel Cells Inc., a subsidiary of Mechanical Technology Incorporated (MTI) (Nasdaq: MKTYNews), is the developer of the award-winning Mobion® direct methanol micro fuel cell technology. MTI Micro has a world- class team of entrepreneurial business executives, researchers and scientists; a number of system prototypes demonstrating size reductions and performance improvements; significant related intellectual property; and has received government awards and developed strategic partnerships to facilitate efforts to achieve commercialization. More information is available at

Statements in this press release which are not historical fact including statements regarding management’s intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future are forward- looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include statements regarding MTI Micro’s ability to meet its milestones on time, if at all, including, the timing of entry into the military, industrial, and consumer markets and MTI Micro’s ability to succeed in such markets, MTI Micro’s ability to manufacture any operationally robust units for field testing in the military market during 2006, if at all, MTI Micro’s ability to produce products or prototypes consistent with any announced specifications or customer requirements (including a prototype that exceed Li-Ion battery energy density), if at all, our ability to enter into agreements with OEMs on commercially reasonable terms during 2006, if at all, and the future prospects, markets, and market acceptance of MTI Micro products. It is important to note that actual results of MTI Micro and Mechanical Technology Incorporated (MTI) may differ materially from those in any such forward-looking statements. Factors that could cause actual results to differ materially include, among others, risks related to financing, uncertainties in development, manufacturing, competition and demand for DMFCs, and the risk factors listed from time to time in MTI’s SEC reports including but not limited to, MTI’s Annual Report on Form 10-K and MTI’s Quarterly Reports on Form 10-Q.

Source: MTI MicroFuel Cells Inc.


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