Additional Generation at the Sheraton San Diego Hotel & Marina to Bring Total Onsite Generation at Two Separate Towers

WHITE PLAINS, N.Y. & DANBURY, Conn. -- FuelCell Energy, Inc. (NasdaqNM:FCEL), a leading manufacturer of ultra-clean power generation plants for commercial and industrial customers, today announced an additional 500 kilowatt (kW) Direct FuelCell(R) (DFC(R)) power plant installation at Starwood Hotels & Resorts' (HOT) Sheraton San Diego Hotel & Marina. This increases Starwood's commitment to base load heat and power from DFC power plants to 2.25 megawatts (MW) at four hotels in California, New Jersey and New York.

The Sheraton San Diego Hotel & Marina's original installation of 1 MW of DFC power generation at its East Tower has been increased by 500 kW with a second installation at its West Tower. The fuel cells will supply base load electricity for the 1,044-room hotel while the heat byproduct will be used for the hotel's pools.

"Increasing the onsite power generation from our DFC power plants at the Sheraton San Diego Hotel & Marina, our fourth Starwood property in the United States to have its base load power from our ultra-clean fuel cells, clearly demonstrates a repeat customer's confidence in our products for commercial applications," said R. Daniel Brdar, President and COO of FuelCell Energy, Inc. "Continuing to meet Starwood's expectations has enabled us to develop hotels as an excellent, repeatable vertical market segment for our DFC products."

The two separate fuel cell installations at the Sheraton San Diego Hotel & Marina will generate a total of 1.5 MW onsite. This will be the largest commercial fuel cell installation in the United States. Starwood will purchase the electricity and heat output from the DFC power plants under a long-term power purchase agreement.

"Managing energy reliability, costs and efficiency are critical components of delivering world class comfort to our customers," said John Lembo, Director of Energy for Starwood Hotels. "FuelCell Energy has proven that the value proposition of its DFC power plants meets our strategic focus -- reducing our energy costs while improving the reliability and cleanliness of power generation at our resorts."

The DFC power plants at the hotel will be installed and operated by Alliance Star Energy, a joint venture between FuelCell Energy and Alliance Power.

"Our work with Starwood in California is evidence that fuel cells are demonstrating the benefits that not only help the environment, but also ease the load on the grid and provide the facility with an environmentally friendly way of producing electricity." said James Michael, President of Alliance Power.

The State of California continues to lead the way in supporting fuel cell technology by providing financial and regulatory support. Fuel cell energy is categorized as an "ultra-clean" and low-emission distributed technology, which produces zero emissions during operation or produces emissions that are equal to or less than limits established by the California Air Resources Board.

The San Diego Regional Energy Office, administrator for The California Public Utilities Commission's (CPUC) Self-Generation Incentive Program for the San Diego area, is expected to issue a reservation letter that will provide incentive funding of up to $1.25 million of eligible project costs to the Sheraton San Diego Hotel & Marina West Tower DFC power plant installation.

FuelCell Energy is seeing increased interest for its ultra-clean DFC power plants by customers such as Starwood that are demanding clean, efficient and reliable onsite power generation. This is more pronounced in markets where high electrical costs, strict emissions controls, grid constraints and other characteristics require a clean, efficient distributed generation solution. The key attributes of the company's DFC power plants include: favorable emissions profile (and resulting less restrictive permitting requirements), lower operating and maintenance costs (due to higher fuel efficiency and remote monitoring), and improved reliability (having power generation located at the customer's site). The company is having success in developing repeatable business in geographical markets such as California that offer sufficient funding to make the pricing of the company's DFC power plants more competitive with the local cost of electricity and cogeneration.

About Starwood Hotels & Resorts Worldwide, Inc.

Starwood Hotels & Resorts Worldwide, Inc. is one of the leading hotel and leisure companies in the world with approximately 750 properties in more than 80 countries and 120,000 employees at its owned and managed properties. With internationally renowned brands, Starwood(R) corporation is a fully integrated owner, operator and franchisor of hotels and resorts including: St. Regis(R), The Luxury Collection(R), Sheraton(R), Westin(R), Four Points(R) by Sheraton, and W(R), Hotels and Resorts as well as Starwood Vacation Ownership, Inc., one of the premier developers and operators of high quality vacation interval ownership resorts. For more information, please visit www.starwoodhotels.com

About FuelCell Energy

FuelCell Energy develops and markets ultra-clean power plants that generate electricity with up to twice the efficiency of conventional fossil fuel plants and with virtually no air pollution. Fuel cells produce base load electricity where commercial and industrial customers face cost, reliability, security or environmental issues with their existing energy supplies. Emerging state, federal and international regulations to reduce harmful greenhouse gas emissions consider fuel cell power plants in the same environmentally friendly category as wind and solar energy sources -- with the added advantages of running 24 hours a day and the capacity to be installed where wind turbines or solar panels often cannot. Headquartered in Danbury, Conn., FuelCell Energy services over 40 power plant sites around the globe that have generated more than 78 million kilowatt hours, and conducts R&D on next-generation fuel cell technologies to meet the world's ever-increasing demand for ultra-clean distributed energy. For more information on the Company, its products and its worldwide commercial distribution alliances, please see www.fuelcellenergy.com.

Direct FuelCell, DFC and DFC/Turbine are registered trademarks of FuelCell Energy, Inc. All other trademarks are the property of their respective owners. The Company's sub-megawatt DFC fuel cell power plant is a collaborative effort combining its Direct FuelCell technology with a Hot Module(R) balance of plant design from MTU CFC Solutions, GmbH, a subsidiary of DaimlerChrysler.