Lithium Technology Corporation Selected for PHEV Project with Volkswagen AG and E.ON

PLYMOUTH MEETING, Pa., June 26 -- Lithium Technology Corporation (LTC) (OTC Pink Sheets: LTHU) announced today that its German subsidiary, GAIA Akkumulatorenwerke GmbH (GAIA), was selected to participate in a passenger car fleet project for Plug-In Hybrid Electric Vehicles (PHEV) sponsored by the German Federal Government. GAIA batteries will power the project made possible in conjunction with Volkswagen AG and E.ON. The project was unveiled today in Berlin by Minister Sigmar Gabriel, Prof. Martin Winterkorn, CEO of Volkswagen AG and Dr. Klaus-Dieter Maubach, CEO of E.ON.

Over the next three years, GAIA will deliver a total of seven lithium ion batteries that are based on iron phosphate cathode chemistry with energy content of about 12kWh. The project will partially be funded by the German Federal Government.

The project aims to demonstrate the use of electricity generated by renewable energy such as wind and solar for powering up 20 PHEV's in a fleet trial under real-time conditions. The project will also validate the superiority of advanced lithium ion batteries to power such vehicles and evaluate the use of various methods of integrating these vehicles into the electric power grid for stabilization purposes.

"It is a great honor for LTC to be part of this program and to work with a leading car company and one of the largest utility companies in Europe," commented Dr. Klaus Brandt, Chief Executive Officer of LTC and Managing Director of GAIA. "This project will not only demonstrate the viability of the use of lithium ion batteries to power PHEV's, but also the use of the large energy storage capabilities that the batteries of such a PHEV fleet represent to the power grid."

"At the present time the automobile is unthinkable without a highly efficient diesel or gasoline engine. The future however, and that is certain, will belong to the electric motors fueled by the wall power plug" (PHEV), commented Professor Winterkorn, CEO of Volkswagen AG in their announcement today. "On this way to the future, our innovative motors (TDI/TSI) combined with electric motors and highly efficient battery systems create advanced propulsion systems."

PHEVs are part of a family of electric-drive technologies that will play an important role in achieving the objectives of energy security and a reduction of greenhouse gas emissions. The relatively large battery installed enables a full electric driving over distances typical in urban situations as the battery can be charged directly from the electricity grid. The increased use of renewable energy sources such as wind and solar put stress on the grid stability as power generation becomes less predictable. PHEV batteries can play a role in stabilizing the grid by charging at times of excess power generation capability and by feeding power back to the grid when there is a power generation shortage.

"LTC, with its unique battery technology, is one of the few companies in the world today that enables the construction of large batteries needed by PHEV's and other heavy duty applications in the transportation market. Moreover, with regard to the grid and renewable energy, we currently target even larger applications, such as grid stabilization and peak shaving, which will require batteries of 2-20 Mega Watt hours, the largest of their kind in the world," concluded Dr. Brandt.

About Volkswagen AG:

Volkswagen AG is a Germany-based automobile manufacturer. The Company consists of two divisions: Automotive and Financial Services. The activities of the Automotive Division comprise the development of vehicles and engines, as well as the production and sale of passenger cars, commercial vehicles, trucks and buses, and the genuine parts business. The Financial Services Division's portfolio of services includes the Company's dealer and customer financing, leasing, banking and insurance activities and fleet management business. The Company is made up of eight brands from six European countries: Volkswagen, Audi, Bentley, Bugatti, Lamborghini, SEAT, Skoda and Volkswagen Commercial Vehicles. The Company operates 48 production plants in 13 European countries and a further six countries in the Americas, Asia and Africa. It sells its vehicles in more than 150 countries worldwide. During the year ended December 31, 2007, the Company delivered some 6.2 million vehicles to customers worldwide.

About E.ON AG Corporation:

E.ON AG, based in Dusseldorf, Germany, is an energy corporation, one of the 30 members of the DAX stock index of major German companies. E.ON is one of the major public utility companies in Europe and the world's largest investor-owned energy service provider. E.ON operates in all of Europe and Scandinavia, and has a stake in the Russian natural gas company Gazprom (6.4%). In the United States, E.ON acquired and renamed LG&E Energy to E.ON U.S., which is headquartered in Louisville, Kentucky. Currently, E.ON is organized in five market units: (i) E.ON Energie AG, which supplies power in continental Europe; (ii) E.ON Sverige, which supplies power in Scandinavia; (iii) E.ON UK, which supplies power in the UK; (iv) E.ON US, which supplies power in the US; and (v) E.ON Ruhrgas, which supplies gas in Europe. E.ON has moved to the alternative power generation in Britain, and will open a windfarm off the coast of Cornwall later this year.

About Lithium Technology Corporation:

Lithium Technology Corporation (LTC) is a global provider of large format rechargeable power solutions for diverse applications, and offers the largest lithium-ion cells with the highest power of any standard commercial lithium ion cell produced in the western hemisphere. With more than 20 years of experience, LTC leverages its extensive expertise in high power and large battery assemblies to commercialize advanced lithium batteries as a new power source in the military and national security systems, transportation and stationary power markets.

LTC manufactures the GAIA(R) product line of large, high power hermetically sealed rechargeable lithium-ion cells and batteries. The Company's product portfolio includes large cells and batteries from 10 times the capacity of a standard laptop computer battery to 100,000 times greater. LTC manufactures a variety of standard cells that are assembled into custom large batteries complete with electronics (battery management systems) and electronics to communicate with other components of the system for performance monitoring.

LTC headquarters are located in Plymouth Meeting, PA and R&D in Nordhausen, Germany. LTC sales for the U.S. and European markets are managed out of each of the offices.