Beacon Power Corp. (fka BCONQ)

[PBandJ]

I emailed Gene Hunt at Beacon Power a few weeks ago and he said the funds raised will last them until near the end of the year. they will need more money then. instead of sell more shares they might try to get a loan. either way, the pps could take a hit. the key will be orders being made and maybe some money flow from that. like I said before, I am in long and may add some more down the road. if this thing does fly, it could be a 10 bagger.

Dear Paul *****:

Thank you very much for your email. We appreciate hearing from all investors and your questions are good ones.


1) The $10.6 million we raised last month is sufficient to complete the two projects you listed, and fund ongoing operations (which includes preparing for production of more flywheels after the prototype is finished,). It is enough cash to get us into the 4th quarter of this year. We have said that we need to raise additional capital this year in order to build the first full size frequency regulation plant in early 2008. That amount will likely come from the shelf registration we filed last year. The alternative to issuing more shares is debt, and to date we’ve avoided that route. We have said that as we get closer to putting the first commercial system into service -- and with the expectation that we will have one or more contracts in place for those services -- we would likely opt for project financing (rather than issue more shares) to raise the needed capital.


2) Regarding “pending sales” I can only say that we’re pursuing sales opportunities in various places. When we have something to announce there we certainly will. Gaining ISO certification in California as we did, along with the recent approval in New York, have certainly helped the cause in that regard.


3) Assuming building permits and grid interconnect agreements are in place, we believe we can build and connect a 20-MW frequency regulation plant in one year or less. Looking further ahead, this process is scalable in that we could subcontract much of the work to building firms and construct multiple plants each year.


4) You are correct in the total number of outstanding shares, approximately 71 million.


5) In fall 2006 we were on schedule to start construction of the first frequency regulation plant in second half 2007. That changed when our flywheel prototype malfunctioned in December and needed certain components redesigned. The schedule was effectively moved out by four months. We now plan to have the first megawatt in service in April 2008. The expected completion date for installing 10-20 megawatts of commercial regulation service did not change, however. That’s expected by the end of 2008.


A site for the first plant has not yet been selected. We are evaluating multiple possibilities and will choose the location that offers the best return on investment and long-term shareholder value.


6) The next newsletter will be Spring 2007 and it will be published in April – hopefully sooner than the Hannover Fair event.


Thank you for your support of Beacon Power. Please feel free to contact me at any time.


Kind regards,

Gene Hunt



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Director of Corporate Communications

Beacon Power Corporation

office: 978-661-2825

fax: [phone]

email: [e-mail]

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have a great weekend! -P