Clean Air Power and Volvo Bus Enter Supply Agreement for Dual-Fuel Systems

| United Kingdom and Sweden

Clean Air Power (CAP), developer of dual-fuel combustion technology that enables heavy-duty diesel engines to operate on a combination of diesel and natural gas, reports that it will deliver 11 dual-fuel systems to Volvo Bus Corporation under a new supply agreement, valued at circa £200,000  (USD 312,000). The agreement follows on from the development agreement signed with Volvo Bus Corporation in July 2010 which stated that the companies would jointly develop the installation of dual-fuel systems on existing bus engines.

The 11 dual-fuel systems will be fitted directly onto the buses on the Volvo production line and these buses are expected to be in service in Sweden by July 2011.  Once in service, the vehicles will be the first Volvo buses to operate on both biogas and diesel as part of a Swedish government backed project, says CAP. Using diesel technology increases environmental efficiency by up to 30-40% compared with current gas-operated buses.  Due to this positive environmental impact, this project is receiving considerable support from the Swedish government who are contributing almost SEK 24m (USD 3.54m) of funding towards the project through the Swedish Energy Agency.

Further to this agreement, the Company is in follow-on discussions with Volvo Bus Corporation regarding the joint development of dual-fuel engines for the next generation of Volvo Buses and bus chassis.

This supply agreement is separate from the supply agreement signed with Volvo Powertrain in July 2010, and represents a further extension to the relationship which began in 2007.

Commenting on the agreement, John Pettitt, CEO of Clean Air Power, said this supply agreement “represents a further endorsement of the significant recognition that Volvo has for our technology and the work that we have done together to date.  It is the first time that we have received a supply agreement from this division of Volvo and hope that this successful agreement may lead to further opportunities with Volvo Bus Corporation in the future.”

(Item primarily compiled using information from a Clean Air Power press release.)

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