Clean Diesel Technologies, Inc. CEO Comments on Proposed Elimination of DERA Funding...

Tue Feb 22, 2011 9:02am EST

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Clean Diesel Technologies, Inc. CEO Comments on Proposed Elimination of DERA
Funding in Fiscal 2012 U.S. Budget Proposal

VENTURA, Calif., Feb. 22, 2011 (GLOBE NEWSWIRE) -- Clean Diesel Technologies,
Inc. (Nasdaq:CDTI) ("Clean Diesel" or the "Company"), a cleantech emissions
reduction company, commented today on the recent announcement made by the Obama
Administration which proposes an elimination of funding for the Environmental
Protection Agency's ("EPA") Diesel Emissions Reduction Program ("DERA").

On February 14, 2011, the Obama Administration proposed a FY 2012 budget to the
EPA eliminating the funding for the DERA program that retrofits diesel trucks
and buses to reduce harmful emissions.

"We are disappointed in the proposal to eliminate the DERA funding, which
funding was reauthorized just last month," said Charles Call, Chief Executive
Officer of Clean Diesel Technologies, Inc. Mr. Call added, "EPA funding for
diesel engine retrofits under the DERA program has proven to be a highly
cost-effective program for several years. It has enabled the installation of
emission systems to existing vehicles, such as heavy duty trucks and school
buses, to reduce harmful emissions at a fraction of the cost of purchasing new
vehicles. Clean Diesel has played an important role in providing a broad set of
retrofit system solutions in the United States. We believe that, since 2008,
$469 million dollars has been appropriated by Congress under DERA and the
American Reinvestment and Recovery Act (ARRA). Projects awarded funding under
ARRA ($300M) are believed to be still in progress until September 2011. In
addition, the 2011 requests for proposals (RFP) recently closed on January 13,
2011 and these funds are not scheduled to be awarded until May 2011. As DERA
projects can be two to three years in length and can result in additional
matching funds under various state and other funding sources, DERA funds are
expected to continue the government's investment in green jobs for the remainder
of 2011 and 2012.

In spite of the proposed elimination of DERA funding in 2012, we see renewed
commitment for on-road diesel emission reductions from state governments, such
as California, where it has mandated that all 1996 through 2009 Class 7 and 8
diesel trucks be retrofit with diesel particulate filters if not so equipped to
meet state emission standards between 2012 and 2014. The state of California is
also scheduled to issue the next solicitation round for Proposition 1B funding
in March/April of 2011. In addition, the U.S. Department of Transportation
provides funding through its Congestion Mitigation and Air Quality Improvement
Program.  Governments outside of the United States are also taking steps to
address emission reductions, as evidenced by the more than 160 low emission
zones in operation throughout Europe with others being planned in Europe and

Mr. Call went on to say that, "While the reduction in DERA funding, if
confirmed, may have an adverse impact on some retrofit programs, the state
mandated opportunities in the United States, coupled with the growth of Low
Emission Zone ("LEZ") initiatives in Europe and Asia are expected to provide a
good growth opportunity for the company."

About the Company

Clean Diesel Technologies, Inc. (Nasdaq:CDTI), "Clean Diesel," "CDT" or the
"Company" is, as a result of the recent business combination with Catalytic
Solutions, Inc. ("CSI"), a vertically integrated global manufacturer and
distributor of emissions control systems and products, focused on the heavy duty
diesel (HDD) and light duty vehicle (LDV) markets. CDT utilizes its proprietary
patented Mixed Phase Catalyst (MPC(R)) technology, as well as its ARIS(R)
selective catalytic reduction; Platinum Plus(R) Fuel-Borne Catalyst (FBC), and
other technologies to provide high-value sustainable solutions to reduce
emissions, increase energy efficiency and lower the carbon intensity of on- and
off-road engine applications. CDT is headquartered in Ventura, California, along
with its wholly-owned subsidiary, CSI, and currently has operations in the U.S.,
Canada, U.K., France, Japan and Sweden as well as an Asian joint venture. For
more information, please visit and

The Clean Diesel Technologies, Inc. logo is available at

Forward-Looking Statements Safe Harbor

Certain statements in this news release such as statements about cost-savings,
government emission reduction programs, EPA budget funding, growth of LEZ
initiatives and growth opportunity constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known or unknown risks, including those
detailed in the Company's filings with the U.S. Securities and Exchange
Commission, uncertainties and other factors that may cause the actual results,
performance or achievements of the Company following the business combination
with CSI to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements. Readers
are cautioned not to place undue reliance on these forward-looking statements,
which speak only as of the date hereof. The Company assumes no obligation to
update the forward-looking information contained in this release.

CONTACT: Kristi Cushing, Investor Relations Manager
         Tel: +1 (805) 639-9458
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