WALLINGFORD, Conn.-- Proton Energy Systems, Inc., a subsidiary of Distributed Energy Systems Corp. (Nasdaq: DESC ), is highlighted in the current issue of Power Engineering, a leading electric utility industry publication. The article, entitled, "On- Site Hydrogen Production Means More Than Convenience," gives background on the efficiencies and cost savings that are driving growing power plant industry acceptance of Proton's HOGEN® Proton Exchange Membrane system for on-site hydrogen generation.

The article discusses how power plant efficiency and capacity can be enhanced by on-site hydrogen generation, resulting in hundreds of thousands of dollars of savings per plant. The article also quotes customers, including an engineering support executive for Mirant's Dickerson Plant in Maryland and an official of Alaska's Golden Valley Electric Association, confirming the benefits derived from on-site hydrogen production and from "not muscling hydrogen bottles around."

Citing data Proton Energy has gathered many leading turbine manufacturers, the article describes how higher purity hydrogen from on-site production improves generator efficiency, extends generating equipment life, and yields gains in plant capacity as a result of increased hydrogen purity. "For example," the article states, "a four percent increase in the purity of hydrogen within an 800 MW generator at a natural gas power plant can save the plant $890 per day or $320,000 per year ... "

Hydrogen is used in power plants to cool the power generator-the device incorporating magnets and copper windings that actually produces electricity. Hydrogen acts as a coolant gas within the generator housing because hydrogen's superior heat transfer properties and low molecular weight offer minimal "wind resistance" to the components spinning within the generator. Keeping generators cool is critical, because elevated temperatures reduce efficiency and, in the extreme, can lead to catastrophic failure. The majority of the world's power plants are cooled with hydrogen, typically delivered via truck by industrial gas companies.

"Initially, on-site hydrogen production was marketed as a convenience that eliminated delivery trucks coming in and out of plant gates while providing marginal cost savings compared to having hydrogen delivered," the article also states. "But since Proton Energy has been providing its HOGEN hydrogen generation systems to power plants, far greater advantages for on-site hydrogen production have become apparent." Proton Energy's proprietary hydrogen generators utilize Proton Exchange Membrane, or PEM, technology to separate high purity hydrogen from water through a process known as electrolysis.

The article also quotes Chip Schroeder, a founder of Proton Energy and now president and CEO of parent company Distributed Energy Systems, stating: "By generating their own hydrogen, plants gain both efficiency and capacity. We found that the savings transitioning from cylinders to on-site hydrogen generation gives plants a payback of investment that is measured in months."

Proton Energy currently has approximately 500 hydrogen generators in various applications worldwide, with 34 units operating in or on their way to power plants. Mark Murray, Proton Energy's president, believes that "There are more than 6,000 hydrogen-cooled power plants around the world. Proton sees an addressable market of several hundred million dollars for this industry alone. With more than four years of experience in this market, our value-oriented marketing strategy for power plants is gaining momentum. Our growing success in this market is one reason why Proton Energy is off to its best start ever in terms of bookings."

More details on how Proton Energy's hydrogen generators are producing reliable benefits for power plants will be presented next week at the ELECTRIC POWER 2005 Conference and Exhibition, in Chicago. Proton Energy will present results of a case study jointly authored with a power plant customer. A written summary of that presentation will be available from after the presentation on April 5.

About Proton Energy Systems, Inc.

Proton Energy Systems, Inc. designs, develops and manufactures Proton Exchange Membrane, or PEM, electrochemical products that it employs in hydrogen generating devices and in regenerative fuel cell systems that function as power generating and energy storage devices. Proton Energy's HOGEN® hydrogen generators produce hydrogen from electricity and water in a clean and efficient process using its proprietary PEM technology. For more information visit http://www.protonenergy.com

About Distributed Energy Systems Corp.

Distributed Energy Systems Corp. (Nasdaq: DESC - News) creates and delivers products and solutions to the emerging decentralized energy marketplace, giving users greater control over their energy cost, quality and reliability. As the parent company of Proton Energy Systems (http://www.protonenergy.com ) and Northern Power Systems ( http://www.northernpower.com ), Distributed Energy Systems delivers a combination of practical, ready-today energy solutions and the solid business platforms for capitalizing on the changing energy landscape. For more information visit http://www.distributed-energy.com .

This press release contains forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Statements contained herein concerning Proton's and Distributed Energy's goals, guidance, revenue projections and other statements that are not statements of historical fact, including statements concerning projected saving by using hydrogen generators in power plant applications, projected sales, or estimated market sizes, may be deemed to be forward-looking information. Without limiting the foregoing, words such as "anticipates", "believes", "could", "estimate", "expect", "intend", "may", "might", "should", "will", and "would" and other forms of these words or similar words are intended to identify forward-looking information. Proton's and Distributed Energy's actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors. Proton Energy Systems and Distributed Energy each disclaim any obligation to update these forward-looking statements. Factors that could cause results to differ materially from those contained in Proton's and Distributed Energy's forward- looking statements include, but are not limited to, failure of our products and systems to perform as specified or achieve commercial acceptance, the impact of competitive products and systems and other factors detailed in Distributed Energy's Form 10-K for the year ended December 31, 2004, and other filings Distributed Energy may make from time to time with the SEC.

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