Echelon Wins Advanced Meter Infrastructure Project With Dutch Utility
01.02.2006 20:30:00

Echelon Corporation (NASDAQ:ELON), a global networkingcompany providing technology and solutions for controls, smartmetering, and energy and environment management, today announced thatEchelon's NES System has been selected under the European Union publictender 65798 -- "eTender Automatic Meter Reading" issued by the Dutchutility Nuon. The companies have entered into a letter of intent, withfinal agreements expected later in February. Echelon will act as alead supplier for the project, providing approximately 25,000intelligent, communicating electricity meters and associated dataconcentrator and NES system software infrastructure. Initialinstallations are planned to begin in the second quarter of 2006 withfinal acceptance of the system targeted for late Q4 2006 or Q1 2007.Revenue to Echelon for the project is expected to be approximately $2million, and is not expected to be recognized until after thisacceptance.
As part of this deployment, the NES System will also be used tocommunicate to approximately 25,000 gas meters via a Meter-Bus (M-Bus)interface, a European standard for connecting various consumptionmeters such as heat, water, and gas meters. Using the newest membersof Echelon's second generation NES electricity meter family, which canact as an "M-Bus master" for up to four attached M-Bus devices, thesegas meters will be able to report alarms and be read over the NESnetwork on a fixed schedule or on demand, and the usage can beprofiled over time. For grid operators, like Nuon, that serve both gasand electricity customers, the ability to read the gas meters over thesame infrastructure being deployed for the electricity meters canbring significant cost savings and service improvements.

"Nuon was our first trial site when we launched the NES system,and we are very pleased to be part of this project as they beginmoving toward larger deployments," said Ken Oshman, Echelon's CEO andchairman. "Nuon has a very sophisticated approach to advancedmetering, with a holistic business model that takes into account awide variety of cost savings and efficiency improvements across thecompany -- a perfect fit for the NES system. Following so closely onthe heels of the Vattenfall announcement for up to 700,000 NES metersannounced in December, we think this is further evidence that a seachange is coming in the utility market."

Echelon's NES system provides an open, bidirectional, andextensible infrastructure that enables a comprehensive range ofutility applications that can bring benefits to every aspect of autility's operation, from metering, to customer services, todistribution operations, to value-added services. The system enables acomprehensive set of energy services, including: two-way automatedmeter reading; multi-tiered billing; time-of-use and real-timepricing; prepaid metering; remote electrical disconnect and reconnect;distribution system asset optimization; electricity outage detectionand restoration management; blackout and brownout elimination;comprehensive revenue protection; real-time direct load control; powerquality measurement; and extensive tamper detection features. Taken asa whole, this set of features yields significant installation,operational, and life-cycle cost savings -- with a typical paybackperiod of two to five years for most utilities.

About Echelon Corporation

Echelon Corporation (NASDAQ:ELON) is a pioneer and world leader incontrol networking -- networks that connect machines and otherelectronic devices -- for the purpose of sensing, monitoring andcontrolling the world around us. Echelon's LonWorks(R) platform forcontrol networking was released in 1990 and has become a worldwidestandard in the building, industrial, transportation, and homeautomation markets. Launched in 2003, Echelon's Networked EnergyServices system is an open, extensible, advanced meteringinfrastructure that can bring benefits to every aspect of a utility'soperation, from metering and customer services to distributionoperations and value-added business. In 2005 Echelon released theworld's first embedded control network infrastructure, the Pyxos(TM)platform, extending the benefits of networking inside machines to thesensors and actuators that make them function.

Echelon has been a leader in the advanced metering infrastructuremarket, providing the underlying network technology for the world'slargest advanced meter management (AMM) project in Italy, with over 27million connected electricity meters and more recently, winning atender to provide the NES system to up to 700,000 customers for theSwedish utility Vattenfall.

Echelon is based in San Jose, California, with internationaloffices in China, France, Germany, Italy, Hong Kong, Japan, Korea, TheNetherlands, and the United Kingdom. Further information regardingEchelon can be found at

Echelon, LonWorks, NES Powered by Echelon, and the Echelon logoare registered trademarks of Echelon Corporation registered in theUnited States and other countries. Networked Energy Services Poweredby Echelon, and Pyxos are trademarks of Echelon Corporation in theU.S. and other countries. Other product or service names mentionedherein are the trademarks of their respective owners.

This press release may contain statements relating to futureplans, events or performance, including statements regarding the awardof the tender for the Nuon project, the timing of installations andacceptance of the system, and the amount and timing of Echelon'srevenue under the project. Such statements may involve risks anduncertainties, including risks associated with the ability of the NESsystem and NES meters to perform as designed, potential production orshipment delays for NES meters and other components; the risk that theapplication of U.S. generally accepted accounting principles couldsignificantly affect the method of calculating, and the timing of, NESrevenues that Echelon expects to recognize under the project; risksthat the deployment and system integration activities with Echelon andother partners in the project are not successful, do not meet theirtarget dates, do not expand or gain momentum, cause Echelon to beliable for penalties or cause the utility to terminate the project;the risk that the project is challenged by third parties and otherrisks identified in Echelon's SEC filings. Actual results, events andperformance may differ materially. Readers are cautioned not to placeundue reliance on these forward-looking statements, which speak onlyas of the date hereof. Echelon undertakes no obligation to releasepublicly the result of any revisions to these forward-lookingstatements that may be made to reflect events or circumstances afterthe date hereof or to reflect the occurrence of unanticipated events.