June 26, 2006
Power Efficiency Corporation Reaches Technical Milestone
Company Finishes Development of Prototype Digital Power Controller Based on Patent Pending Technology. Forms Basis for Future Products in Industrial and Appliance Installations
LAS VEGAS--(BUSINESS WIRE)---Power Efficiency Corporation (OTCBB: PEFF), a developer and manufacturer of advanced energy savings technologies for electric motors, today announced it has successfully completed development of a prototype digital power controller based on its new proprietary software- and microchip-based technology. The prototype successfully reduces the current and voltage supplied to a single phase motor, similar to those found in many appliances and light commercial equipment. The controller also soft starts the motor, bringing it from rest to full speed in a gradual manner.
The prototype includes a microchip and software, comprising the Company’s latest technological developments. This technology is covered by a provisional patent the Company recently filed. Further improvements will result in additional patent filings.
“Electric motors operating at low loads can waste in excess of half of the energy they consume. With this prototype and the provisional patent we recently filed, we have taken great steps toward using our proprietary technology to improve the efficiency of vast numbers of electric motors,” said Steven Strasser, Power Efficiency’s Chairman and CEO.
The Company believes its new technology will have the following benefits:
• Reduced product manufacturing expenses, resulting in greater gross margins
• Increased access to distribution networks, including industrial rep networks, distributors and energy service companies that resell electric motor soft starts and drives
• New opportunity to license the technology to manufacturers of motor control systems and soft starts
• Improved potential for sales or licensing opportunities to appliance manufacturers, so their products can more easily and inexpensively qualify for the Federal Government’s EnergyStar® rating
Power Efficiency Corporation’s microchip-based technology will not only be the foundation for its own product line, but can also be incorporated by other manufacturers of control systems and soft starts. These manufacturers include some of the world’s largest industrial companies.
Strasser also stated, “Power Efficiency Corp is also targeting home and light commercial appliances, which have many motors that are candidates for the Company’s technology. For example, there are over 14 million refrigerators and freezers and 8.5 million washing machines sold in the United States each year. We believe our digital controller may become the simplest and most cost-effective technology to reduce the energy consumed by many appliances.”
With the completion of this prototype, the Company is now aggressively moving toward the design and subsequent manufacturing of commercial units for use on motors in industrial facilities and commercial buildings. For example, motors on grinders, conveyors, crushers, saws, stamping presses, escalators, elevators and other applications are candidates for the PEC’s technology. The Company anticipates having certified and commercialized units ready for market in the first quarter of 2007.
About Power Efficiency Corporation
Power Efficiency Corporation designs and manufactures the Power Efficiency Motor Efficiency Controller™, a product that reduces the amount of energy used by electric motors in many constant speed/variable load applications. These motors are found in escalators, elevators, grinders, granulators, mixers, saw mills and many other applications. The Power Efficiency Motor Efficiency Controller™ allocates power in direct proportion to the motor's required workload, eliminating wasted electricity. The company's core technology is based on patented improvements to NASA technology. Energy savings from these controllers are typically 20-40%, but can be as high as 45%. The controllers also reduce the operating heat of the motor, enabling significant motor life extension and downtime reduction benefits. PEC products are UL compliant and CE and CSA certified. For more information visit www.powerefficiencycorp.com.
As a cautionary note to investors, certain matters discussed in this press release may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such matters involve risks and uncertainties that may cause actual results to differ materially, including the following: changes in economic conditions; general competitive factors; acceptance of the Company's product in the market; the Company's success in technology and product development; the Company's ability to execute its business model and strategic plans; and all the risks and related information described from time to time in the Company's SEC filings, including the financial statements and related information contained in the Company’s 2005 Annual Report. Power Efficiency assumes no obligation to update the information in this release.
Contact:
Power Efficiency Corporation
B.J. Lackland, 702-697-0377
Chief Financial Officer
blackland@powerefficiencycorp.com
