"We have been working closely with the client's engineers for the past year to produce a custom designed system that meets their exacting specifications," said Jeffrey Powell, EVP of ThermoEnergy and President of the Castion division. "We are very pleased that Castion was selected as the vendor of choice to provide this system." The Castion system includes an ultraviolet sanitation unit, a high recovery dual membrane system, a CAST 2500 vacuum distillation system, an integrated control system and additional ancillary equipment.

Dennis Cossey, ThermoEnergy's Chairman and CEO stated "We see this as the beginning of a long-term relationship with this valuable new client, and we look forward to the opportunity to provide environmentally responsible and cost-effective solutions for their future water management needs." Water management, conservation and reuse are becoming essential to sustainability, not just in the US, but in many parts of the world as communities struggle to meet the growing demand for clean water. "A significant number of Castion's proprietary and patented process systems are dedicated to providing solutions for these critical issues," said Cossey.

About CASTion

CASTion, a subsidiary of ThermoEnergy Corporation, is a 22-year old award winning company, with offices in Massachusetts, Florida, Louisiana, Ohio and California, that provides customized turnkey systems for industrial wastewater treatment. CASTion offers a comprehensive range of products and services including vacuum distillation, evaporators, reverse osmosis, ion exchange, oil/water separators and specialty products. CASTion has successful installations across the U.S., Canada, Mexico and Japan. CASTion's customer base includes the military, power generation, mining, food processing, beverage, automotive, chemical process, refining, micro-electronics, municipal, heavy manufacturing, textile and semi-conductor industries. Its client list includes a significant number of Fortune 100 companies. Additional information on the CASTion can be found on its website at www.castion.com.

About ThermoEnergy

Founded in 1988, ThermoEnergy is an integrated technologies company engaged in the worldwide commercialization of patented and/or proprietary municipal and industrial wastewater treatment and power generation technologies. The economic and environmental matrix of the Company's technologies represents a significant advancement in these key infrastructure industries. The Company currently has offices in Little Rock, AR, Hudson, MA, Worcester, MA and New York, NY. Additional information on the Company and its technologies can be found on its website at www.thermoenergy.com and www.castion.com.

This press release may include statements that constitutes "forward looking" statements, usually containing the word "believe", "estimate", "project", "expect" or similar expressions. Forward looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward looking statements. Factors that would cause or contribute to such differences include, but are not limited to, continued acceptance of the company's products and services in the marketplace, competitive factors, changes in regulatory environments and other risks detailed in the company's periodic report filings with the securities and exchange commission. By making these forward looking statements, the company undertakes no obligation to update these statements for revisions or changes.