China Energy Recovery Enters into Engineering Design Service Contract with Fortune Global 500 Company for 30 MW Heat Recovery Power Generation System

Sep 23, 2008

-- Design contract continues China Energy Recovery's push into high gross margin heat recovery services.
-- Design contract is obtained from ongoing relationship with MECS, Inc.

China Energy Recovery, Inc. (OTCBB:CGYV) ("China Energy Recovery" or "CER"), a leader in the waste-heat energy recovery sector of the alternative energy industry, today announced that the company has entered into a design service contract with Sinochem Fuling Chongqing Chemical Industry Co., Ltd. (“Sinochem Fuling”) for the detailed engineering design of a 30 MW Heat Recovery Power Generation System. The value of the design service contract is estimated to be RMB 960,000 (approximately $140,000 as of the date of this press release). The announcement was made by the Chairman and CEO of China Energy Recovery, Mr. Qinghuan Wu.

China Energy Recovery announced that Shanghai HAIE Hi-tech Engineering Co., Ltd., its operating affiliate, is to provide detailed engineering design services to Sincochem Fuling for a heat energy recovery retrofit project for its 1.2 million metric ton per year sulfuric acid production facility in Chongqing, China. The retrofit project is to integrate two sets of low temperature heat recovery systems (HRS) provided by MECS, Inc. with whom CER works together to deploy low temperature heat energy recovery systems for sulfuric acid production facilities in China. The contract will also include engineering design to install two sets of related power generation equipment with a total power generation capacity of 30 MW. Sinochem Fuling will use the heat energy recovered partially in the form of steam, which will be redirected into its production process. The remaining recovered heat will be used to generate electricity, which will be sold to the power grid to generate additional revenue for Sinochem Fuling

Sinochem Fuling, located in Chongqing in southwest China, is a key fertilizer production subsidiary of Sinochem Corporation, a Fortune Global 500 company and one of the largest state-owned enterprises in China. Sinochem Fuling has applied for Clean Development Mechanism certification on this project, in order to monetize the carbon credits that will be created from the new heat recovery systems.

“We are very pleased that Sinochem Fuling has selected China Energy Recovery to provide the detailed engineering design services to install the low temperature HRS systems of MECS for their sulfuric acid production plant in Chongqing, China,” stated Mr. Qinghuan Wu, Chairman and CEO of China Energy Recovery, “With our engineering capability and experience in heat energy recovery systems and the low temperature heat recovery systems of MECS, this system is expected to play an important role in reducing overall costs of operations for Sinochem Fuling by allowing it to sell recovered electricity back into the grid and monetize carbon credits created from this project. This demonstrates CER’s desire to continue to provide more design services for our customers, which produce an attractive gross margin for CER.”

What is Waste Heat Energy Recovery?

Industrial facilities and power plants release significant amounts of excess heat into the atmosphere in the form of hot exhaust gases or high-pressure steam. Energy recovery is the process of recovering vast amounts of that wasted energy and converting it into usable electricity, dramatically lowering energy costs. Energy recovery systems are also capable of capturing the majority of carbon emissions and other harmful pollutants that would otherwise be released into the environment. It is estimated that energy recovery systems installed in U.S. industrial facilities could produce up to 20% of U.S. electricity needs without burning any additional fossil fuel, and could help many industries to meet stringent environmental regulations.

About China Energy Recovery, Inc.

CER is an international leader in energy recovery systems, with a primary focus on the Chinese market. CER's technology captures industrial waste energy to produce low-cost electrical power, enabling industrial manufacturers to reduce their energy costs, shrink their emissions footprint, and generate sellable emissions credits. CER has deployed its systems throughout China and in such international markets as Egypt, Turkey, Korea, Vietnam and Malaysia. CER focuses on numerous industries in which a rapid payback on invested capital is achieved by its customers, including: chemical, petro-chemicals, refining (including Ethanol refining), coke processing, and the manufacture of paper, cement and steel. CER continues to invest in R&D and plans to build China's first state-of-the-art energy recovery system research and fabrication facility to allow it to meet the increased demand for its products and services. For more information on CER, please visit: http://www.chinaenergyrecovery.com/s/Home.asp. Information on CER's website does not comprise a part of this press release.
　