News Release

July 6th 2010

Vancouver: Palcan is pleased to announce that China Telecom has selected Palcan’s back up power system (UPS), a Fuel Cell based system, to test at its newest cell tower in the Shanghai region.

The location for the test is on Chongming Island, China's the third largest Island located at the mouth of the Yangtze River close to Shanghai.

_{(China Telecom’s new cell tower on Chongming Island)}

The testing of Palcan’s UPS represents one of the ways China Telecom and all other China’s Mobile providers are beginning to deploy greener ways to conduct their business and in this case by replacing battery and diesel UPS systems.

The Fuel Cell application provides a number of advances over other UPS systems including; smaller footprint, lighter, no emissions, no noise, more reliable and lower costs over time. For this application Palcan integrates Canada’s Ballard Power Systems fuel cell stack as few others match its reliability.

China Telecom’s agreement with Palcan represents the state of a significant opportunity for Palcan to be a provider of cell tower power back up for which there will be many thousands of new cell towers over the next 5 years to serve China's 3G and 4G mobile mobile platforms.

Palcan is a private Canadian company with two Chinese Joint ventures through which Palcan will commercialize a number of Palcan’s fuel cell powered applications.

For more information visit www.palcan.com and/or email: jshen@palcan.com