Energy Recovery and Seawater Desalination

SAN LEANDRO, Calif.-- Energy Recovery, Inc. (Nasdaq:ERII), a global leader of ultra-high-efficiency energy recovery products and technology for seawater desalination, announced today that it will release its third quarter results for fiscal 2008 on Tuesday, November 11, 2008, after the market close. The Company will host a conference call for investors on Tuesday, November 11, 2008 at 1:30 p.m. PT.

The conference call will be in a "listen-only" mode for all participants other than the sell-side and buy-side investment professionals who regularly follow the Company. The toll-free phone number for the call is 800-951-9235 or 706-758-9752 and the access code is 68565515. Callers should dial in approximately 15 minutes prior to the scheduled start time. A telephonic replay will be available at 800-642-1687 or 706-645-9291, access code: 68565515, from 5:30 p.m. PT Tuesday, November 11, 2008 to 8:59 p.m. PT on Tuesday, November 24, 2008. Investors may also access the live call or the replay over the internet at www.streetevents.com and www.energyrecovery.com. The replay will be available approximately three hours after the live call concludes.

About ERI(R)

Energy Recovery, Inc. (ERI) is a leading manufacturer of energy recovery devices, which by significantly reducing energy consumption is helping make desalination affordable. ERI's PX Pressure Exchanger(R) technology (PX(R)) is a rotary positive displacement pump that recovers energy from the high pressure waste stream of sea water reverse osmosis systems at up to 98% efficiency with no downtime or scheduled maintenance.

The company has research, development and manufacturing facilities in the San Francisco technology corridor as well as direct sales offices and technical support centers in key desalination hubs such as Madrid, UAE, Shanghai and Florida. ERI service representatives are based in Algeria, Australia, China, India, Korea, Mexico, Taiwan and the Caribbean.

As the demand for clean, potable water increases; ERI is poised to face the global challenges ahead. For more information on ERI and PX technology, please visit www.energyrecovery.com.

Design Requirements

In the original RFP, KAJUR requested twin 75,000 gpd SWRO units (expandable to 100,000 gpd) designed for a seawater feed of 45,000 mg/l TDS. The proposal presented by Hydropro was for two Seawater Reverse Osmosis Water Treatment units each designed to produce 75,000 gallons per day. Permeate water was projected to be of less than 300 mg/l TDS based on feed water from seawater wells with a maximum TDS of 50,000 mg/l and an SDI of less than 3. Each unit was designed to be easily expandable to a daily capacity of 100,000 gallons by the addition of one pressure vessel containing seven seawater membranes. All instrumentation, piping, valves, headers and pumps were pre-sized to accommodate the expansion.

Each proposed SWRO system consisted of four pressure vessels containing seven membrane elements each arranged in a single, one-pass array. With the expansion, the system would consist of five pressure vessels in a single staged array. Each system was designed to operate at a 30-40% recovery rate, with a maximum trans-membrane (feed to product) pressure of 1100 psi at a feed water TDS of 50,000 mg/l. With a feed water TDS of 46,000 mg/l, the trans-membrane pressure was projected to be approximately 900 psi at startup and 950 psi after three years of operation.

System Design

The final, installed 100,000 gpd Hydropro design consisted of the following major components and unit operations for each SWRO unit:
• Sand and Particulate Filters: Two HYDROPRO Tubular filter units Model STF5M2-400- PVC/150 each consisting of one PVC housing with a 150-micron wedge wire PVC screen for the removal of sand and particles, with automatic purge valves
• Micron Filters: Three heavy-duty filter housings constructed of FRP/PVC and built to ASME Code X, the housings are Eden Model 24EFC each accommodating six (6) 40" long five micron polypropylene cartridges
• RO High Pressure Booster Pumps: Two high pressure feed booster pumps Grundfos Model BM 17-27R (installed in series) - horizontal centrifugal, multi-stage construction of 904L Super Austenitic Stainless Steel, each driven by a 35 HP submersible type motor rated at 460V/60Hz/3Ø utilizing a Soft start motor starter and VFD RO Low Pressure Booster Pump: One booster pump Grundfos Model BM 30-4R - horizontal centrifugal, multi-stage type of 904L Super Austenitic Stainless Steel, driven by a 7.5 HP submersible type motor rated at 460V/60Hz/3Ø controlled by a variable frequency drive
• Membrane Modules: One FRP construction structural frame, five pressure vessels of FRP construction rated at 1200 psi operating pressure, 35 Thin Film Composite membrane elements ¬ 8" x 40", 2205 DUPLEX SS headers for feed and concentrate and Sch. 80 PVC for the permeate headers and low pressure feed, suction and concentrate piping, Allen- Bradley PLC SLC 5/04 based control system - installed in a NEMA 4X enclosure with system switches lights etc. installed on the panel door
• Chemical Feed Systems: One anti-scalant dosing system and one chlorine dosing system
• Freshwater Flush/Membrane Cleaning System

The system skid was designed and fabricated for a compact footprint due to limited installation space and to allow for shipping both units in a single container. The entire system was pre-assembled as much as possible to minimize field services.

Water-short California's search to satisfy its thirst is beginning to focus on a controversial source -- the Pacific Ocean.

In November, Connecticut-based Poseidon Resources Corp. won a key regulatory approval to build a $300 million water-desalination plant in Carlsbad, north of San Diego. The facility would be the largest in the Western Hemisphere, producing 50 million gallons of drinking water a day, enough to supply about 100,000 homes.

Taking the salt out of seawater is a common way to produce drinking water in the Middle East and in other arid regions. World-wide, 13,080 desalination plants produce more than 12 billion gallons of water a day, according to the International Desalination Association.

But it has been less successful in the U.S. Desalination is more expensive than traditional sources, and critics say it harms the ocean. In 1992, Santa Barbara, Calif., shuttered a small plant after three months when rain replenished the county's main water sources. At a plant near Tampa, Fla., that Poseidon was also involved in, technical glitches increased the water's cost and, when it opened in 2003, initially limited output to less than a third of the projected 25 million gallons a day.

Southern California water officials say conditions have changed. Improved technology has cut the cost of desalination in half in the past decade, making it more competitive. And traditional water supplies, such as the Colorado River and snow-melt runoff, are becoming less reliable because of population growth and environmental restrictions.

"We have to get our water from somewhere, and it's going to be the Pacific Ocean," says Gary Arant, manager of the Valley Center Municipal Water District, which serves farms and homes around San Diego. His district has agreed to buy almost 15% of the Carlsbad plant's output. Poseidon says it has signed 30-year contracts with nine local water districts to sell all the water; about 40% would go to the city of Carlsbad.

The project has attracted big financial partners. In May, General Electric Co. said it had invested in it and would provide filtration technology. In September, Citigroup Inc.'s sustainable-development-investments unit became the lead investor in closely held Poseidon, formed in 1995 by former GE executives and private-equity firm Warburg Pincus. Andrew de Pass, the Citigroup unit's managing director, says the need for long-term water sources drove the investment. He declined to specify how much Citigroup invested.

Poseidon hopes to break ground this year and deliver water no later than 2011, providing it wins approval for its plans to mitigate the plant's impact on marine life and to offset its carbon-dioxide emissions.

The plant would initially take the saltwater discharged from an adjacent power plant that uses it for cooling, and later take water directly from the Pacific. Two sets of filters purify the water. The first set, thin tubes resembling rows of angel-hair pasta, blocks relatively large particles. The seawater is then pumped at very high pressure through dense membranes to remove salt, in a process called reverse osmosis.

This process uses a lot of electricity, contributing to its big price tag. Poseidon plans to sell the water for about $950 per acre-foot. That compares with an average $700 an acre-foot that local agencies now pay for water. (An acre-foot is 325,851 gallons, enough water for four people a year.) The Metropolitan Water District, a wholesale supplier to 18 million Southern Californians, will subsidize the difference as a way to add new water sources to the region. Poseidon President Walter Winrow says Poseidon will raise its price as local agencies pay more for water from other sources.

Peter Gleick, head of environmental think-tank Pacific Institute, says the costs of desalination projects tend to increase from those projected by sponsors, because of energy expenses and environmental requirements. "What people claim is always a little different," says Mr. Gleick.

There are other obstacles. California coastal regulators and some environmentalists say desalination uses too much energy and kills fish when the water is processed. Two environmental groups Monday filed suit to block the plant, on the grounds that it will harm marine life. Peter MacLaggan, who oversees the Carlsbad project for Poseidon, says the plant would kill about two pounds of fish a day, or "less than the daily consumption of one pelican."

Some opponents are wary of Poseidon because it was originally the co-developer of the troubled Tampa plant. Poseidon and the engineering firm it was working with estimated in 1999 that the plant would cost $110 million to build and produce water costing an average of $677 an acre-foot.

Then two engineering firms involved in the plant ran into financial difficulties, slowing work on the project.

In 2002, Tampa Bay Water, the government agency building the plant, bought out Poseidon and took on plant oversight. Tampa Bay Water ultimately brought in other companies, including units of Spain's Acciona S.A. and Germany's RWE AG, to finish and run the plant.

Last month, years behind schedule, the plant was declared fully operational, producing more than 25 million gallons of drinking water a day. Exceeding the initial estimate, construction came to $158 million, and the desalinated water costs $1,100 an acre-foot. Tom Pankratz, a Houston-based consultant to Tampa Bay Water's lawyers and a spokesman for the IDA, says there was "sloppy work" across the board. Poseidon's president, Mr. Winrow, says the company "would have managed the construction more appropriately" if it had been allowed to finish the project.

Ken Herd, Tampa Bay Water's operations director, says the plant is mostly running smoothly and the region may build more plants. Desalination is "not the cheapest source of supply, but it's drought-proof," he says.

Southern California officials toured the Tampa Bay plant before signing with Poseidon on the Carlsbad plant. Poseidon has brought in Acciona and RWE'S American Water to design and operate it.

Meanwhile, improved membranes and pumping systems have sharply reduced electricity costs. G.G. Pique, chief executive of Energy Recovery Inc., which makes desalination technology for the plant, estimates it will cost the Carlsbad plant $1.10 in electricity to produce 1,000 gallons of water. That is down from $2.10 per 1,000 gallons at the mothballed Santa Barbara plant, which he was also involved in.

The push on the Carlsbad plant comes as the National Academy of Sciences nears completion of a report on the potential role of desalination in meeting U.S. water needs.

Water experts are watching closely. California regulators are mulling as many as 20 proposed seawater projects that could produce 500 million gallons of water a day for the state. Poseidon is planning a second major plant in Huntington Beach, about 60 miles north of Carlsbad. "We're excited about the prospects," says Mike Chrisman, California's Secretary of Water Resources.

Tampa, FL, September 16, 2008 - The Ministry of Electricity and Water (MEW) of Kuwait awarded Doosan Heavy Industries & Construction the 136,000 m3/day (36 million US gallons per day (MGD)) Shuwaikh Seawater RO Desalination Plant with Recarbonation system. Doosan Heavy Industries & Construction is executing the project on an EPC basis while Doosan Hydro Technology, the wholly owned US based subsidiary, will partially provide basic process design engineering, as well as detail engineering review services. Energy Recovery, Inc. (“ERI”) (NASDAQ:ERII), a global leader of ultra-high-efficiency energy recovery products and technology for desalination was also contracted for its innovative PX Pressure Exchanger (PX) technology for the Shuwaikh SWRO project.

Water sustainability is a growing concern in the Middle East and the Kuwaiti Ministry of Electricity and Water has taken proper measures to sustain a potable water supply for its communities. The Plant is Kuwait’s first seawater desalination plant using RO technology. It will supply drinking water for 450,000 residents in Kuwait City. Under the contract, Doosan will design and build the plant, which is to be built near Shuwaikh port, as well as supply equipment and materials. The project is scheduled for completion in September 2010.

Doosan selected ERI’s largest commercially available 65-Series product, the PX-260 energy recovery device due to its high efficiency, flexibility and small footprint. The project will include 187 PX-260 PX Pressure Exchanger® energy recovery devices which will save an estimated 12.7 megawatts of power. ERI and Doosan also teamed up for the 150,000 m3/day (39.6 MGD) Al Shuaibah III Expansion SWRO Desalination Plant in September of 2007.

Dr. Richard Stover, ERI Chief Technology Officer stated, “We are excited about winning this project in Kuwait. Our ground-breaking work in the early 1990’s at the Kuwait Institute of Scientific Research (KISR) Laboratories laid the foundation for our innovative PX technology. It’s with great pleasure that we are able to give back to the region”, Dr. Stover continued. ERI has several desalination plants throughout the Middle East and North Africa engaging its PX technology. From large plants in Algeria and the UAE to smaller plants throughout Egypt and Saudi Arabia; ERI has focused its efforts on providing the region with advanced energy recovery solutions. The company has a regional sales office in Dubai.

About ERI(R)

Energy Recovery, Inc. (ERI) is a leading manufacturer of energy recovery devices, which by significantly reducing energy consumption is helping make desalination affordable. ERI's PX Pressure Exchanger(R) technology (PX(R)) is a rotary positive displacement pump that recovers energy from the high pressure waste stream of sea water reverse osmosis systems at up to 98% efficiency with no downtime or scheduled maintenance.

The company has research, development and manufacturing facilities in the San Francisco technology corridor as well as direct sales offices and technical support centers in key desalination hubs such as Madrid, UAE, Shanghai and Florida. ERI service representatives are based in Algeria, Australia, China, India, Korea, Mexico, Taiwan and the Caribbean.

As the demand for clean, potable water increases; ERI is poised to face the global challenges ahead. For more information on ERI and PX technology, please visit www.energyrecovery.com.

SAN LEANDRO, Calif.--(BUSINESS WIRE)--Sept. 3, 2008--Energy Recovery, Inc. ("ERI") (NASDAQ:ERII), a global leader of ultra-high-efficiency energy recovery products and technology for desalination, announces that the Spanish joint venture of FCC / AQUALIA / BEFESA group of companies awarded the contract for energy recovery equipment for its Bajo Almanzora seawater desalination project to ERI. The plant will supply 60,000 m3/day (15.9 MGD) of fresh water to the region.

The design, build and operate seawater desalination project was awarded to the partnership of FCC/AQUALIA and BEFESA in August 2007 by Acuamed, the Spanish governmental water authority. Spanish companies have played a leadership role in designing and building desalination plants world-wide. The plant is located in the province of Almeria, Andalucia region, along the southeastern border of Spain. It is currently under construction and is scheduled to produce water in 2009. The Bajo Almanzora seawater desalination plant will supply water to one of the warmest provinces in the country where the level of rainfall is one of the lowest in Europe, with much of the area containing semi-arid and desert-like landscapes.

ERI PX(R) technology was specified for the project. ERI will supply 50 PX-220 energy recovery devices to operate in the first-stage of the reverse osmosis process. It is estimated that this technology will save the project over 5 mega-watts of high-pressure pump power. Last year, Befesa and ERI teamed to provide and energy recovery solution to India's largest desalination plant located in Chennai.

ERI's Vice President, of the Mega Projects Division stated, "As with all our projects, we feel very satisfied when our customers build desalination plants that consider energy recovery as a key component of the overall solution."

About ERI(R)

Energy Recovery, Inc. (ERI) is a leading manufacturer of energy recovery devices, which by significantly reducing energy consumption is helping make desalination affordable. ERI's PX Pressure Exchanger(R) technology (PX(R)) is a rotary positive displacement pump that recovers energy from the high pressure waste stream of sea water reverse osmosis systems at up to 98% efficiency with no downtime or scheduled maintenance.

The company has research, development and manufacturing facilities in the San Francisco technology corridor as well as direct sales offices and technical support centers in key desalination hubs such as Madrid, UAE, Shanghai and Florida. ERI service representatives are based in Algeria, Australia, China, India, Korea, Mexico, Taiwan and the Caribbean.

As the demand for clean, potable water increases; ERI is poised to face the global challenges ahead. For more information on ERI and PX technology, please visit www.energyrecovery.com.

91,000 m3/day (24 million gallons per day) Hamriyah Seawater

Desalination Plant in Sharjah Selects PX Technology

SAN LEANDRO, Calif.--(BUSINESS WIRE)--Aug. 5, 2008--Energy Recovery, Inc. ("ERI") (NASDAQ:ERII), a global leader of ultra-high-efficiency energy recovery products and technology for desalination, announced that it has been awarded a contract to provide the energy recovery technology for the Hamriyah (Phase 1) Power Station Seawater Reverse Osmosis (SWRO) Desalination Plant. Aqua Engineering GmbH and ERI have signed a supply agreement for PX(R) energy recovery devices for the 91,000 cubic meters per day (m3/day) (24 million gallons per day (MGD)) plant to be located in Sharjah, United Arab Emirates.

The plant was awarded to Austrian company Aqua Engineering GmbH, a subsidiary of Christ Water Technology AG, by the Sharjah Electricity and Water Authority (SEWA). The overall capacity of the Hamriyah facility will be 455,000 m3/day (120 MGD) of fresh water by reverse osmosis technology and 181,000 m3/day (48 MGD) by a thermal desalination process called multiple effect distillation (MED). This phase of the project will include 104 PX-260 PX Pressure Exchanger(R) energy recovery devices which will save an estimated 13 megawatts of power. Designed with a total of eight (8) SWRO trains operating in parallel, the devices will provide fail-safe redundancy and reliability with little or no down-time. Currently, the plant is under construction and scheduled for start-up in 2009. Initial work on the site included a 600 MW power plant. The SEWA project will eventually supply 2000 MW of power and 637,000 m3/day (168 MGD) of desalinated water.

In late 2007, ERI announced the release of its PX-260 device, the latest addition to its PX technology line of products. The PX-260 is part of the 65-Series product line and is the Company's largest commercially available energy recovery device, handling brine flow rates of up to 260 gallons per minute (59 cubic meters per hour) - nearly 20% greater capacity than ERI's former largest device. It operates at the highest efficiency, providing the best overall energy savings and lowest cost of ownership of any commercially available energy recovery solution.

The Middle East has been a mainstay for ERI with many small to large plant installations across the region, ranging from small hotels in Egypt and UAE to larger projects in Saudi Arabia, among others. The company has a regional sales office in Dubai.

"This is the fourth plant within a few years for which we have chosen PX technology. Having installed them in various plant sizes in Oman and UAE, we found these devices working very reliably and most efficiently," stated Guido Codemo, Process Engineer for Aqua Engineering.

About ERI(R)

Energy Recovery, Inc. (ERI) is a leading manufacturer of energy recovery devices, which by significantly reducing energy consumption is helping make desalination affordable. ERI's PX Pressure Exchanger(R) technology (PX(R)) is a rotary positive displacement pump that recovers energy from the high pressure waste stream of sea water reverse osmosis systems at up to 98% efficiency with no downtime or scheduled maintenance.

The company has research, development and manufacturing facilities in the San Francisco technology corridor as well as direct sales offices and technical support centers in key desalination hubs such as Madrid, UAE, Shanghai and Florida. ERI service representatives are based in Algeria, Australia, China, India, Korea, Mexico, Taiwan and the Caribbean.

As the demand for clean, potable water increases; ERI is poised to face the global challenges ahead. For more information on ERI and PX technology, please visit www.energyrecovery.com.