Hybrid Fuel Systems Unveils the No School Bus Left Behind Initiative; 438,000 Diesel School Buses Targeted for Hybrid's Fuel 2 Conversion Technology

TAMPA, Fla.--Jan. 1, 20051, 2005--Hybrid Fuel Systems, Inc., ("Hybrid" or the "Company') (OTCBB:HYFS) today unveiled the details to the Company's No School Bus Left Behind Initiative(TM).

According to the US Environmental Protection Agency (EPA) internet web site, 24 million school age children ride the bus daily. On average, children spend an hour and half per day on a school bus and school buses travel 4 billion miles a year. In a 2003 document published by the EPA titled What You Should Know About Diesel Exhaust and School Bus Idling, "Exposure to diesel exhaust can cause lung damage and respiratory problems. Diesel exhaust also exacerbates asthma and existing allergies and long-term exposure is thought to increase the risk of cancer."

Previously, the only proposed solution to the school bus diesel exhaust problems were filters and traps. Both items are a capital expense and offer no opportunity for a payout beyond partially reducing one or more pollutants. Further, both techniques have problems for which current technology can't solve. Hybrid recently announced independent emission results for the Company's Fuel 2(TM) conversion technology. These results indicate that a diesel school bus retrofitted with a Fuel 2(TM) conversion kit can immediately bring the bus into recommended levels of compliance.

Under the terms of the No School Bus Left Behind Initiative(TM), Hybrid will sell kits at fixed price $4,500 per kit. Hybrid will purchase the required catalytic converter and fuel storage tanks at volume prices and pass the savings on to the school system. Once a kit is installed, Hybrid will, at its own expense, conduct quarterly emission audits to ensure the emission reduction targets are achieved. If for any reason connected to Hybrid's Fuel 2(TM) kit the emissions of a particular bus fall below acceptable levels, Hybrid will adjust or replace the kit at no cost to the school system. During February 2005 Hybrid will raise awareness of the Company's No School Bus Left Behind Initiative(TM) through a direct mail program targeting school buses in the continental United States.

"This is much more than a one-time sale," said CEO Mark Clancy. "We intend to inspect the buses on a quarterly basis to ensure our children are riding in as clean an environment as possible. This program will not only have a dramatic and immediate effect on our children but will have a meaningful and lasting impact to society as a whole. Trends at the pump indicate that natural gas will continue to sell for less than diesel fuel. A school bus converted with our Fuel 2(TM) kit can not only expect an immediate reduction of harmful pollutants, but the school system can recognize a measurable savings in transportation costs. We believe this is a great combination," concluded Mr. Clancy.

Hybrid was formed in 1996 to commercialize retrofit systems for the conversion of diesel stationary or vehicular engines to non-petroleum based fuels such as natural gas. The Company's technology is based on five patents and one patent pending. For more information contact CEO Mark Clancy at 813-979-9222 or visit the Company's website at http://www.hybridfuelsystems.com.