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Evergreen Energy Inks Agreement with China Power Investment Corporation

DENVER - September 21, 2007 - Evergreen Energy Inc (NYSE Arca: EEE), a leader in providing solutions for energy and environmental needs, has signed an “Agreement to Proceed” with specifications and design work that lead to the construction of a K-Fuel® lignite coal refinery in the Inner Mongolian Autonomous Region of the People’s Republic of China (PRC). The agreement was signed yesterday with a subsidiary of China Power Investment Corporation (CPI), one of the five state-owned power generation companies in China.

“Coal feedstock tests have been conducted and CPI has evaluated the significant potential of the K-Fuel® process to upgrade low-rank coal, enhance plant efficiency and reduce harmful pollutants,” said Madam Zhang Xiaolu, vice president of international business at CPI. “We have been interested in the K-Fuel® technology solution for some time and are happy to have an agreement to move forward at this time.”

“China presents an important, timely business opportunity for Evergreen, one we cannot overlook,” said Kevin R. Collins, president and CEO of Evergreen, “but we do so without detriment to our domestic business, which we continue to pursue aggressively with multiple parties interested in K-Directsm refineries or shipments to industrial customers.”

“China is looking for near-term answers to its energy and environmental challenges,” Collins added. “We see this as a significant step forward for Evergreen and look forward to supporting CPI’s and the PRC’s efforts to build a cleaner energy future for their country.”

The stated objective of both parties in the opening line of the “Agreement to Proceed” is “to construct a new lignite refinery in the Inner Mongolian Autonomous Region of the People’s Republic of China based on patented K-Fuel® technology with specifications that meet Baiyinhua Coal and Power Company Limited (BCP) performance requirements to produce BCP K-Fuel® product.”

BCP is a principal CPI subsidiary and operating unit. CPI is a state-owned enterprise that operates in 27 provinces, autonomous regions and municipalities with installed generating capacity of almost 38 gigawatts. It has more than 83,000 employees.

The signed agreement calls for a feasibility study followed by a technical services contract that will be funded by CPI to develop environmental, water and land use specifications for the plant. The third phase would develop detailed specifications under a technical license contract to meet BCP’s process and performance requirements.

Upon completion of the three phases, an engineering, procurement and construction contract would be awarded for construction of the new coal refinery.

Top executives from CPI toured Evergreen Energy’s K-Fuel® plant in Gillette, Wyoming before the signing. In addition, Evergreen has held extensive talks with CPI in China regarding the project.

Project Result of US-PRC Energy Accord

This project received support from the U.S. Department of Energy (DOE) and the PRC Ministry of Science and Technology (MOST), and is the result of a MOST and CPI amendment to the “U.S.-PRC Agreement for Cooperation in Fossil Fuel-Clean Coal Technologies” signed earlier this week in Washington, D.C. The “Fossil Energy Protocol” (Dept. of Energy Fossil Protocol) between the United States and China was recently extended to 2010 at a signing ceremony in Beijing.

China’s Energy Challenges

This agreement comes at a time when China’s utility and government leaders are seeking near-term solutions to address the escalating energy demands of rapid industrialization while mitigating the environmental effects of power generation. The government has set targets for reduced emissions and energy conservation and has initiated major efforts to develop new and alternative power sources, including solar and wind.

China gets the bulk of its electricity from coal and as its economy grows the country is now expected to need as much energy in 2010 as it thought it would need in 2020. As it continues to build new coal-fueled power plants, the country is seeking ways to make economical and cleaner use of its estimated 52 billion tons of lignite (brown) coal. Multiple tests with Chinese lignite have shown the K-Fuel® process significantly improves its heat value.

Test burns and commercial applications of K-Fuel® have shown a reduced emissions profile due to refined coal’s higher efficiency. Depending on the feedstock coal, these improvements have included lower mercury content and lower sulfur dioxide and nitrogen oxides emissions. Engineering calculations suggest that due to improved efficiency, K-Fuel® can have a beneficial effect on the amount of CO2 emitted per kilowatt hour generated.

About Evergreen
Evergreen Energy Inc (NYSE Arca: EEE) refines coal into a cleaner, more efficient and affordable solid fuel that is available today to meet the growing energy demands of industrial and utility customers while addressing important environmental concerns. Visit www.evgenergy.com for more information.

About CPI
China Power Investment Corporation (CPI) was established from part of the constituent businesses of the former State Power Corporation of China (SP). With a registered capital of 12 billion RMB, CPI has been approved by the State Council to become one of the pilot state-authorized investment entities and state-owned holding corporations.

As of the end of 2006, the total assets of CPI amounted to 177.831 billion RMB. Its controllable installed capacity reached 37800 MW, of which, 9220 MW or 24.4% comes from hydro units, 27230 MW or 72% from thermal units and 1350.8 MW or 3.6% from nuclear units. The equity capacity of CPI is 28043.3 MW. CPI has 168 member companies/institutions and 15 participating companies with 83,086 employees in total.

Contacts:

Analysts and Investors:
Karli Anderson
Director of Investor Relations
303-293-2992

Media and Public Affairs
Paul Jacobson
VP Corporate Communications
303-293-2992

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