Electric Vehicle Division News

Electric Fuel's All-Electric Transit Bus to be Tested as Part of
Department of Energy Cooperation Program with Israeli Ministry

— Cooperation Agreement Signed by US Energy Secretary Richardson and Israeli Infrastructures Minister Suissa —

February 22, 2000 — The Electric Vehicle Division of Electric Fuel Corporation (NASDAQ: EFCX) announced that an all-electric transit bus using its high-energy, high-power zinc-air battery system will be tested in the United States and Israel according to a cooperation agreement signed today between the US Department of Energy (DOE) and the Israeli Ministry of National Infrastructures (MOI).

The new agreement, for cooperation in the field of electric and hybrid buses, was signed today in Jerusalem by Secretary of Energy Bill Richardson and his Israeli counterpart, Minister of National Infrastructures Eli Suissa. The agreement is an annex to a 1996 general agreement on energy cooperation between the two countries.

According to the new agreement, the DOE and MOI have agreed to cooperate in order to facilitate exchange of information and joint activities in the field of electric and hybrid buses. The cooperation will specifically include the retrofitting of two similar buses in the United States, one with Electric Fuel's advanced zinc-air batteries, which were developed by the Company's Israeli subsidiary, and the other using battery systems developed by DOE. According to the agreement, the first bus can be the one already being built by NovaBus, General Electric Co. and Electric Fuel and funded by the Federal Transit Administration (FTA) of the US Department of Transportation. The bus uses an Electric Fuel zinc-air battery pack as its primary energy source, with a high-power rechargeable battery available for boosting power as well as to regain valuable energy during braking.

The agreement calls for the two buses to be tested in urban transportation service in the US for an agreed period of time, following which the buses will be shipped to Israel for testing in an urban bus route in Israel. The results of the tests will be analyzed and evaluated by experts from both countries. Technical and financial details of the project, including the configuration and the specifications of the buses and the schedule of the tests, will be discussed and agreed between technical experts from both sides. The agreement also calls for the next steps of the collaborative effort to be negotiated after the evaluation of the test results is completed.

Secretary Richardson noted that "this is an important technology that's been developed in Israel and this expanded cooperation will help both our nations," and added that aiding the development of electric mass transit technologies will support several of his key objectives at DOE, by helping to reduce US dependence on imported oil while reducing environmental pollution and greenhouse gas emissions. Minister Suissa responded by saying that he was "very pleased that Israel has leading technologies to offer the United States and the rest of the world in the field of energy and environment."

Yehuda Harats, Electric Fuel president and CEO, said that the cooperation agreement is a natural extension to the FTA-funded bus project, since the battery-battery hybrid electric propulsion system implemented in the bus is being developed by Electric Fuel and General Electric with funding from the US-Israel Bi-National Research and Development (BIRD) Fund. "This is a very positive step forward for our electric bus program, providing for additional testing of the all-electric transit bus under different conditions," said Harats, "and we are grateful that both the DOE and the Israeli MOI have indicated their confidence in Electric Fuel's zinc-air energy system for electric vehicles."

Electric Fuel Corporation, with corporate offices in New York and manufacturing and R&D facilities in Israel and Alabama, is pioneering the use of zinc-air battery technology for consumer electronics, electric vehicles, and industrial applications.

NOTE: This press release contains forward-looking statements. There are certain important factors that could cause results to differ materially from those anticipated by the statements made above as set forth in Electric Fuel's annual report on Form 10-K for the fiscal year ended December 31, 1998. Among, but not limited to these factors, are the stage of development of the Electric Fuel's products, the uncertainty of the market for the Company's products, and significant future capital requirements.