The highlights of the Material Transfer & Collaborative Testing Agreement signed today are:

--  SANYO will purchase samples of Hoku Membrane and Hoku MEA for testing
    at SANYO's R&D facility in Japan.

--  Hoku Scientific and SANYO will continue to collaborate on testing of
    Hoku Membrane and Hoku MEA.

Dustin Shindo, chairman of the board, president and chief executive officer of Hoku Scientific, said, "We are excited by this additional commitment by SANYO to our company and technology. We look forward to continuing to work closely with SANYO in an effort to integrate Hoku Membrane and Hoku MEA products into SANYO's fuel cells. This agreement reflects our mutual commitment to stay at the leading-edge of non-fluorinated membrane and MEA technologies."

In March 2003, Hoku Scientific and SANYO entered into a contract to jointly develop an MEA assembly process using Hoku Membrane for integration into SANYO's residential fuel cell systems. As of February 2005, SANYO agreed that Hoku Scientific had satisfied all of the performance milestones under its contract with SANYO. The companies have continued to work together, each bearing their own costs, to conduct testing of Hoku Membrane and Hoku MEA.

The new agreement announced today will allow SANYO to evaluate newer versions of Hoku Scientific's membrane and MEA products that have been developed since completion of the collaboration portion of the prior agreement, and formalizes the next step towards the integration of Hoku Membrane and Hoku MEA into SANYO's fuel cells.

About Hoku Scientific, Inc.

Hoku Scientific (NasdaqNM:HOKU) develops and manufactures fuel cell membranes and membrane electrode assemblies (MEA) for stationary (including residential and back-up power applications) and automotive proton exchange membrane (PEM) fuel cells. For more information visit www.hokuscientific.com.

About SANYO Electric Co., Ltd.

SANYO Electric Co., Ltd. is a global consumer electronics giant leading the way in technology innovation with consolidated sales of $23,151 million yen for FY 2004. SANYO's businesses cover a broad range of products such as AV/Information and Communications Equipment, Home Appliances, Commercial Equipment, Rechargeable Batteries, Electronic Devices and Others. In sync with its new corporate vision -- 'Think GAIA,' SANYO will provide global solutions by knitting together its numerous proprietary technologies. For further information, please visit SANYO's web site at http://www.global-sanyo.com/.