Hoku Scientific Buys Land in Kapolei for Production Facility

HONOLULU, Oct. 21, 2004 -- Hoku Scientific, Inc., announced today that it has purchased 2.2 acres in Kapolei Business Park on Oahu for the construction of its global headquarters and manufacturing facility.

"Purchasing land in Kapolei Business Park marks a major milestone for Hoku Scientific as we begin the automated production of our fuel cell membrane and MEA products," says Dustin Shindo, chairman and CEO of Hoku Scientific.

"The facility will include office space, research and development labs and production space, which is scalable to meet the growing volume requirements of our customers," says Shindo. "We expect to break ground on the building in early 2005."

Hoku Scientific recently announced an agreement to sell significant volumes of its Hoku Membrane(TM) and Hoku MEA(TM) products to a global automotive company, and in 2003 Hoku Scientific announced its relationship with Sanyo Electric Co., Ltd., to develop a membrane electrode assembly using Hoku Membrane(TM) for integration into Sanyo's fuel cell systems. In Japan stationary fuel cells, which provide residential electricity and hot water, will be marketed as early as 2005.

According to Scott L. Mitchell and Guy V. Kidder of Colliers Monroe Friedlander, Inc., exclusive sales agents for Kapolei Business Park, "Hoku Scientific's research into cutting edge technologies is exactly the type of business Kapolei Business Park was designed for. The park's advanced connectivity should benefit their operations."

Hoku Scientific is the second lot sale since the ownership of 97-acre Kapolei Business Park changed hands in June of this year. According to Colliers, "another 10 lots should close over the next several months and activity within the park has been reflective of the high demand and the low availability of quality industrial lands for sale on Oahu."

Hoku Scientific is financing the construction with a loan from American Savings Bank, Hawaii's third largest financial institution. "We are delighted by the opportunity to finance the growth and expansion of an emerging Hawaii company," says Gabe Lee, senior vice president and manager of the commercial markets at American Savings Bank. "This financing is consistent with our commitment to the community and the growth of local businesses.

Fuel cells use hydrogen and oxygen to generate electricity with only water and heat as byproducts. This technology is the leading zero-emissions solution under development by automotive companies to ultimately replace the internal combustion engine. The consumer availability of fuel cell vehicles, however, has been hindered by high cost and limited performance and durability. Hoku Scientific's proprietary fuel cell membrane and MEA technologies were developed to accelerate the commercialization of fuel cells by lowering their cost while also improving their performance and durability.

Hoku Scientific is a developer of advanced components for Proton Exchange Membrane (PEM) fuel cells. Located in Honolulu, Hawaii, the company is currently focusing its efforts on a new non-fluorinated membrane technology for use in PEM fuel cells, called Hoku Membrane(TM). Hoku Membrane offers the potential for substantially improved performance over today's leading membranes, while reducing production costs by up to 90%. Hoku Scientific is backed by various investors, including Hawaiian Electric Industries, Inc. , Servco Pacific, Lava Ventures, Advantage Capital Partners, HMS Hawaii and Garage Technology Ventures. Hoku Scientific is an executive member of the US Fuel Cell Council.

www.hokuscientific.com

American Savings Bank is Hawaii's third-largest financial institution with $6.5 billion in assets. American Savings Bank provides a full range of financial products and services, including commercial banking and consumer deposits and loans. American Savings Bank has the second-largest branch network in the state, with 68 branches and nearly 170 automated teller machines. For more information on American Savings Bank, visit www.asbhawaii.com.