Mr. Larry Stapleton reports

BALLARD SIGNS MOU WITH RIGAS SATIKSME AND SKODA ELECTRIC FOR CLEAN TROLLEY BUS PROGRAM

Ballard Power Systems Inc. has signed a non-binding memorandum of understanding with Rigas Satiksme, a Latvian transit bus operator, and Skoda Electric, a leading Czech Republic bus and tram manufacturer, in relation to a hydrogen-fuel cell-powered trolley bus development and deployment program called Hy-Trolley, for the city of Riga, Latvia.

Rigas Satiksme provides public transportation services throughout Riga, the capital of Latvia, including operation of more than 250 trolley buses, 116 trams and 415 diesel buses. Growth in the city has made expansion of the catenary network that supports the trolley bus fleet impractical. As a result, some trolley buses operate with diesel generators for a portion of their route, adversely affecting air quality. Replacement of diesel generators with clean energy power modules supplied by Ballard will eliminate emissions from the trolley buses.

"We are concerned about air quality in Riga and are searching for ways to improve it," said Leons Bemhens, chief executive officer of Rigas Satiksme. "We are confident that this proposal with Skoda and Ballard can be an important part of the solution."

Under the Hy-Trolley program, Skoda and Ballard will undertake a feasibility study and product evaluation, followed by potential replacement of up to 27 diesel generators on existing trolley buses with Ballard's next-generation FCvelocity-HD7 fuel cell power module in the 2016 time frame. The Ballard module features reduced parts count, including fewer moving parts, integrated air compressor and coolant pump, along with reduced parasitic load.

Ladislav Sobotka, chief technology officer and board member of Skoda, said, "Skoda is very happy to be working with Ballard on this exciting opportunity to provide a zero-emission solution for an important customer."

Skoda is focused on manufacturing vehicles for public transportation and railways and has a long history of developing and manufacturing low-floor trams, trolley buses and hybrid vehicles for ecological public transport in European cities.

Larry Stapleton, Ballard vice-president of global sales, added: "Ballard has extensive experience with heavy-duty fuel cell modules. We are excited to have this opportunity to work on the Hy-Trolley program with Rigas and Skoda for delivery of clean transportation in Riga using our leading-edge product solution."

We seek Safe Harbor.