Integrated CHP Demonstration

Ceres Power Holdings plc
11 September 2007



11 September 2007

Ceres Power Holdings plc
('Ceres', 'Ceres Power' or the 'Company')

Fuel Cell CHP Demonstration and Facilities Showcase

Ceres Power, the AIM-quoted fuel cell group, today demonstrates an integrated, 
wall-mountable combined heat and power unit ('CHP Unit').  The successful 
design, construction and testing of this natural gas-fed unit represents an 
important milestone in the Company's  residential CHP programme with British Gas 
and highlights the commercial potential of the product.  The compact and 
wall-mountable design will enable access to both the boiler replacement and 
new build residential mass markets in the UK and overseas.

As part of an ongoing testing programme, the integrated wall-mountable CHP Unit 
has already demonstrated the capability of generating electricity and all of the 
central heating and hot water requirements of a typical home, avoiding the need 
for a separate boiler.  The compact CHP Unit uses the same natural gas, water 
and electricity connections as a boiler, and is thus easy to install.

Key balance of plant components within the CHP programme have been developed in 
partnership with well-established volume manufacturers in Europe and the USA 
from industries including automotive and white goods. The operating temperature 
(500-600degreesC) of the unique Ceres Power fuel cell technology has enabled the 
use of widely available and cost-effective raw materials, components and 
manufacturing equipment.

Facilities - The fit-out of the recently secured Product Facility has been 
completed, with the focus shifting to validating performance of the core 
manufacturing processes through statistical process trials.  All of the key 
volume production equipment has now been installed on-site and includes machines 
for: steel substrate perforation, ceramic layer deposition, fuel cell drying and 
firing, stack layer welding, and associated quality control.  Initial process 
trials have been conducted, with further work helping to finalise the planned 
investment in scaling-up to the Company's first volume production facility 
('Mother Plant').

In parallel, detailed planning for the Mother Plant is also proceeding to plan 
with final specification expected by end 2007.  The initial footprint of the 
facility should have a rated capacity of approximately 1million cells per annum,
with the  ability to be expanded through more intense shift patterns and
additional  equipment.  The plant will also be designed for low-volume complete
product  assembly to service early market uptake and to help transfer to volume
assembly  partners in-country for mass market deployment. The Company is
planning a  facility with floor space in the region of 50,000 ft2 with short-
listed location  options focusing on UK sites to minimize logistics costs and
facilitate  knowledge transfer from the Company's existing operations.

Peter Bance, Chief Executive of Ceres Power, commented:

'The demonstration of an integrated wall-mountable CHP Unit is not only a 
significant step forward in the commercialisation of our unique technology but 
also represents an industry-leading position.  We are now focusing on value 
engineering of the CHP Unit and the scale-up of core manufacturing processes 
to meet expected customer demand.'

Following today's event, the Company will be holding a series of shareholder 
visits to its Crawley headquarters and will also present its CHP hardware at the 
London Stock Exchange on Friday September 14th.

A presentation summarizing the CHP demonstration and facilities showcase is 
available on Ceres Power website through 
the following link:
http://www.cerespower.com/investor/press.htm.

                                       - ends -

For further information contact:

Peter Bance, Chief Executive, Ceres Power                   [phone]
Patrick d'Ancona / Charlotte Kirkham                        [phone]
M: Communications


About Ceres Power

Ceres is a successful AIM-listed fuel cell business developing a range of global 
market applications including residential combined heat and power, 
on-site / back-up generators and auxiliary power units for transport.  The 
technology is based on commercially available materials for low cost manufacture 
and, unlike many fuel cells, the Ceres cell operates on widely available fuels 
like natural gas and LPG, as well as on hydrogen.

Ceres has developed a new generation of Solid Oxide Fuel Cell (SOFC) technology 
which operates in the temperature range of 500-600 degrees C enabled by the use 
of CGO (Cerium Gadolinium Oxide) as the electrolyte material.  This is
substantially  lower than the temperatures at which conventional SOFC materials
operate,  typically 750-1000 degrees C for YSZ (Yttria Stabilised Zirconia).

The inherently lower operating temperature of the Ceres CGO-based SOFC 
technology enables thin ceramic layers to be supported by metal substrates, 
which, in turn, provides the basis of cell and stack designs manufactured from 
commercially available grades of stainless steel, providing excellent sealing 
integrity, mechanical robustness, and thermal shock resistance.

Fuel and air are supplied to a stack of fuel cell layers to produce electricity 
and heat via a solid state electrochemical process, similar to a battery.  
Unlike combustion in an engine or with a burner, this solid state process is 
highly efficient, environmentally friendly, and quiet.

The uniqueness of the Ceres metal supported SOFC technology and its operating 
temperature range provide the basis for a range of attractive commercial 
applications in terms of: fuel efficiency, with associated economic savings and 
reduction in carbon emissions; heat-to-power ratio ideally suited for domestic 
CHP applications and well matched to seasonal variations in electrical and heat 
demand; the ability to operate on a range of commercially available fuels 
including natural gas and LPG; low temperature of operation enabling use of 
commercially available materials resulting in reduced product costs.

In conjunction with the Ceres stack programme, the Company has been developing 
the non-fuel cell elements within the complete product, known as the balance of 
plant ('BOP'), as part of its systems integration activities aimed at 
delivering products for specific customers.  Because of the unique attributes of 
the technology, Ceres has been able to dramatically reduce the time and cost of 
BOP development and systems integration by utilising mature component supply 
chains and ordinary, low cost materials. Unlike other fuel cell designs which 
operate at more extreme temperatures, time-consuming and expensive bespoke 
solutions for BOP components are not required.





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