APWRU A-Power Energy Generation Sys (MM)

A-Power Energy Generation Systems, Ltd. (NASDAQ:APWR)(NASDAQ:APWRW)(NASDAQ:APWRU) ("A-Power") announced today that its Chinese operating subsidiary, Liaoning GaoKe Energy Group (๏ฟฝGaoKe๏ฟฝ), has entered into an agreement with Norwin A/S of Denmark (๏ฟฝNorwin๏ฟฝ) that gives GaoKe the exclusive right to produce and sell Norwin๏ฟฝs 750 kW and 225 kW wind turbines in China. Mr. Jinxing Lu, A-Power's Chairman and CEO, commented, ๏ฟฝWe are excited to become the exclusive partner of Norwin in China and this agreement marks a significant step in our strategic plan to become the leading clean energy solutions company in Asia. As a natural adjunct to our rapidly expanding distributed power generation business, we are adding this leading wind technology to our repertoire of potential energy sources. The market demand for renewable energy in Asia is surging. China๏ฟฝs wind energy market alone is expected to grow to over 50 GW of output by 2020, up from just 1.2 GW in 2005. We look forward to playing a major role in that growth.๏ฟฝ As part of the agreement with Norwin, a joint venture company will be established in Shenyang, China that is 80% owned by GaoKe. This JV will begin selling the 750 kW and 225 kW wind turbines later in 2008, after construction is completed on the first phase of GaoKe๏ฟฝs new wind turbine production facility. GaoKe and Norwin will also establish a joint research and development facility in Shenyang to develop new wind turbine technology for both the China and the international markets. To secure these rights, GaoKe has agreed to pay Norwin a license fee of $3.5 million. The sales price of the 225 kW wind turbine has not yet been determined, but the 750 kW wind turbine is expected to sell for RMB 3.4 to 3.7 million ($0.46 to $0.51 million) with approximately 8 to 12% gross margins. GaoKe will have the capacity to produce a maximum of 420 units of 750 kW wind turbines and 400 units of 225 kW wind turbines on an annual basis after the first phase of its wind production facility is completed later this year. This product will complement the 2.5 MW wind turbines that GaoKe has also acquired rights to from Germany-based Fuhrlander AG and, when combined, will create a wind turbine portfolio that will give GaoKe the ability to accommodate the varying wind conditions across China. About A-Power A-Power Energy Generation Systems, Ltd., formerly Chardan South China Acquisition Corp., through its PRC operating subsidiary, Liaoning GaoKe Energy Group Co., Ltd., is the largest provider of distributed power generation systems in China and will enter into China๏ฟฝs wind energy market in 2008. The Company is also focused on developing and commercializing additional renewable energy technologies and has strategic relationships with both, Tsinghua University and the China Sciences Academy in Guangzhou. This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, about A-Power and GaoKe. Forward-looking statements are statements that are not historical facts. Such forward-looking statements, based upon the current beliefs and expectations of A-Power๏ฟฝs and GaoKe๏ฟฝs management, are subject to risks and uncertainties, which could cause actual results to differ from the forward looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: business conditions in China; continued compliance with government regulations; legislation or regulatory environments, requirements or changes adversely affecting the businesses in which GaoKe is engaged; cessation or changes in government incentive programs: potential trade barriers affecting international expansion; fluctuations in customer demand; management of rapid growth and transitions to new markets; intensity of competition from or introduction of new and superior products by other providers of distributed power generation and other energy generation technology; timing, approval and market acceptance of new product introductions; general economic conditions; geopolitical events and regulatory changes, as well as other relevant risks detailed in A-Power๏ฟฝs filings with the Securities and Exchange Commission. The information set forth herein should be read in light of such risks. Neither A-Power nor GaoKe assumes any obligation to update the information contained in this press release.