Raser Technologies Enters Design Agreement with a Singapore Company

PROVO, Utah--Sept. 21, 2006--Raser Technologies, Inc. (NYSE Arca: RZ, "Raser") today announced that it has entered into a design and engineering consulting agreement (the "Agreement") with a wholly owned subsidiary of a publicly traded, Singapore-based engineering company. Financial terms of the transaction were not disclosed.

The Agreement calls for Raser to provide technical, engineering and design support for the development and manufacture of a switched reluctance ("SR") motor and drive. Raser will receive royalty payments on a sliding scale based on sales of up to 500,000 units.

For certain applications, Raser believes that SR motors offer advantages over traditional DC and induction motors. SR motors do not contain permanent magnets, brushes or windings on the rotors, thus resulting in reduced weight, less wear, and lower manufacturing cost. SR motors also provide higher initial starting torque and are well suited to applications requiring high speeds.

"Raser looks forward to the development of a new product line of SR motors," said Raser's President, Patrick J. Schwartz. "Despite its inherent advantages, broad adoption of the SR motor has been hindered by the challenges of torque ripple or acoustic noise. We have forged an alliance with another technology company to address the torque ripple and noise problems, with a goal of making valuable advances in SR motor technology. We believe the experience gained in this SR motor project will be complementary to our core business and will increase the breadth of our rotating electro-magnetic device offerings."

Raser Chief Executive Officer Brent M. Cook added, "Although this design will likely generate less revenue than a licensing of our patented Symetron(TM) technology, it provides an excellent forum to cultivate commercial relationships and could lead to future licensing opportunities."

About Raser Technologies

Raser is a publicly traded technology licensing company focused on improving the efficiency of rotating electro-magnetic and heat transfer applications within the Transportation, Industrial and Power Generation markets. Further information on Raser may be found at: www.rasertech.com.

Cautionary Note Regarding Forward-Looking Statements

This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, but not limited to, our belief that our expertise in developing the Symetron(TM) control systems will enable us to make valuable advances in SR motor technology; our belief that our experience from the SR motor project will complement our core business and increase our technical breadth in the field of rotating electro-magnetic devices; and our ability to obtain funding for our development activities relating to the SR motor technology.

These forward-looking statements involve certain risks and uncertainties that could cause actual results to differ, including, without limitation, the competitive environment and our inability to compete in the SR motor industry; our inability to effectively apply our technical knowledge to projects in the SR motor industry; our inability to enter into agreements with third-party subcontractors to fulfill our obligations under the Agreement; our inability to protect any intellectual property we obtain in SR motor technology; and such other risks as identified in Raser's quarterly report on Form 10-Q for the quarter ended June 30, 2006, as filed with the Securities and Exchange Commission, and all subsequent filings, which contain and identify important factors that could cause the actual results to differ from those contained in forward-looking statements.

All forward-looking statements in this press release are based on information available to us as of the date hereof, and we undertake no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this press release.