Echelon and Mori Building Team to Bring Open, Integrated Buildings Systems to Asian Market Including Asia's Largest Office/Residential Complex and World's Tallest Building

SAN JOSE, Calif. and TOKYO--()--Aug. 26, 2003--

  LonWorks(R) Networking Recognized as the Standard for Office Building Automation by Japan's Largest General Developer  

Echelon Corporation (Nasdaq:ELON) the creator of the LonWorks device networking platform for networking everyday devices to each other and the Internet, and Mori Building, Co., Ltd., Japan's largest commercial real estate developer and operator, today announced that Mori Building is requiring LonWorks open systems using Echelon's hardware and software infrastructure and integration products for Mori's most important building projects. As the developer and operator for the recently opened Roppongi Hills (Roppongi 6-chome, Minato-ward, Tokyo), Japan's premier office, residential and retail complex and the upcoming Shanghai World Financial Center in Shanghai, China, Mori Building is committing millions of square feet of commercial real estate to LonWorks networking systems. When completed in 2007, Shanghai World Financial Center will be the world's tallest building with 101 above ground stories, 378,500 sq. meters (4.07 million sq. ft.) of space, and a height of 492 meters (1,618 feet) -- exceeding the height of Patronas Twin Towers.

Yuzou Tada, managing director of Mori Building Co., Ltd. said, "LonWorks networks have fundamentally changed the market for automated buildings in Japan and Asia, resulting in more and more open building automation systems. As users, this has enabled us to construct systems based on our own needs and initiative." Tada added, "Because of our market position and extensive and successful use of LonWorks open systems, both users and manufacturers have benefited in terms of greater competition, expanded business opportunities, increased quality of service, lower costs and greater flexibility -- from system design, through implementation, to adds/moves/changes over time."

Mori's most recent LonWorks project is the 729,000 sq. meters (7.8 million sq. ft.) Roppongi Hills project, currently believed to be the world's largest stand-alone LonWorks building project. Over 100,000 workers and residents occupy Roppongi Hills every day. Mori's initial estimates for energy savings attributed to the LonWorks based air conditioning system of 16,500 intelligent devices are over 20% per year. Mori expects greater savings in many other facets of operating costs over time as the Roppongi Hills project matures.

"From their position as Japan's largest general developer and through their actions in demanding LonWorks based open systems, it's our belief that Mori building is effectively redefining the Japanese building market," said Lawrence Chan, Echelon's vice president of Sales and Regional Manager, Asia/Pacific. "At Roppongi Hills Residences, Mori building is setting what we believe is the new standard for what end-users expect from their systems and creating new and better opportunities for manufacturers enabled by their specification of LonMark(R) interoperable products, IP integration using Echelon's i.LON(R) Internet Servers, and Internet connectivity through web services interfaces."

Mori Building's first multi-vendor, open building automation system project based on the LonWorks platform, Koraku Mori Building, was completed in March 2000. This first foray took advantage of the interoperable nature of LonWorks networks to easily interconnect sub-systems and add functionality over time -- all in a multi-vendor, open bid, environment. The resulting reduction in life cycle cost and collection of very detailed device data allowed Mori Building to develop an efficient operation and management methodology for building analysis and to quantify the benefits of LonWorks based open systems.

Upcoming Mori projects that will have LonWorks based open building automation systems using Echelon's infrastructure products include the "Toranomon 5-chome Project," "Jingumae 4-chome redevelopment Project," "ARK Mori Building renewal Project," both in Japan, and the "Shanghai World Financial Center" in Shanghai, China, the World's tallest building.

About the Roppongi Hills Development Project

Roppongi Hills Mori Tower

-- Roppongi 6-chome, Minato-ku, Tokyo, Japan

- 54 floors; 6 basement levels

- 380,105 sq. meters (4.09 million sq. ft.)

-- Primary Uses

- Offices, shops, Museum, restaurants, conference center, etc.

- Almost half a million visitors during the first week of operations

-- Features

- Asia's largest multi vender system using LonWorks platform

- 18 vendors

- 12,500 LonWorks devices

- 160,000 monitoring points

Roppongi Hills Residences

-- Roppongi 6-chome, Minato-ku, Tokyo, Japan

- Residence A: 6 floors, 2 basement levels (35 houses)

- Residence B: 43 floors, 2 basement levels (336 houses)

- Residences C: 43 floors, 2 basement levels (255 houses)

- Residences D: 18 floors, 2 basement levels (223 houses)

- 149,811 sq. meters (1,612,555 sq. ft.)

-- Features

- Disaster control center employed to consolidate the monitoring systems of all residences

- 7 vendors

- 1,240 LonWorks devices

- 10,000 monitoring points

-- i.LON 1000 Internet Servers deployed on each residential floor

About Mori Building, Ltd.

Headquartered in Tokyo, Japan, Mori Building is Japans' largest commercial real estate developer and operator with 2002 revenues of 76.9 billion Yen. The company was founded in 1959 and currently includes urban development and the planning, design supervision, operation and management of office, residential, commercial, hotel and other facilities under its scope of business. As of April 2001, Mori leased 790,000 square meters (8.5 million square feet) of space in 94 buildings.

About Echelon Corporation

Echelon Corporation is the creator of the LonWorks platform, the world's most widely used standard for connecting everyday devices such as appliances, thermostats, air conditioners, electric meters, and lighting systems to each other and to the Internet. Echelon's hardware and software products enable manufacturers and integrators to create smart devices and systems that lower cost, increase convenience, improve service, and enhance productivity, quality, and safety. Thousands of companies have developed and installed LonWorks products and more than 30 million LonWorks enabled processors have been shipped for use in homes, buildings, factories, trains, and other systems worldwide.

The protocol underlying LonWorks networks and the signaling technology used by Echelon's power line and free topology transceivers have been adopted as standards by the American National Standards Institute (ANSI). Echelon is also a founding member of the LonMark Interoperability Association, an open industry forum of hundreds of leading manufacturers, integrators, and users dedicated to promoting the use of interoperable LonWorks devices. More information is available at http://www.LonMark.org. Further information regarding Echelon can be found at http://www.echelon.com.

Echelon is a sponsor of the LonWorld(R) Exhibition, the world's largest event devoted to the networking of everyday devices, to be held October 15-16th 2003 in Munich, Germany. The show is being organized by TEMA AG. Concurrent with the LonWorld Exhibition, Echelon will hold an international developers' conference. More information on the show can be found at http://www.lonworldexpo.com or http://www.tema.de. Contact Echelon for more information about the developers' conference.

Echelon, LonWorks, LonMark, i.LON, LNS, LonWorld, the LonMark logo, and the Echelon logo are registered trademarks of Echelon Corporation registered in the United States and other countries. Other marks belong to their respective holders.

This press release may contain statements relating to future plans, events or performance. Such statements may involve risks and uncertainties, including risks associated with uncertainties pertaining to the timing and level of customer orders, demand for products and services, development of markets for Echelon's products and services; risks associated with Mori Buildings' use of LonWorks based products, the growth of the LonWorks industry in Japan and other Asian countries, sales targets not being met, and development of markets for Mori Building services; and other risks identified in Echelon's SEC filings. Actual results, events and performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Echelon undertakes no obligation to release publicly the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events

Contacts

Echelon Corporation
Steve Nguyen, 408-938-5272
qnguyen@echelon.com
or
Echelon Japan K.K.
Etsuko Sugita, +81-3-3320-1288
lonworks@echelon.co.jp
or
McQUERTER
Tina Wilmott, 858-450-0030 ext. 140
twilmott@mcquerter.com

Contacts

Echelon Corporation
Steve Nguyen, 408-938-5272
qnguyen@echelon.com
or
Echelon Japan K.K.
Etsuko Sugita, +81-3-3320-1288
lonworks@echelon.co.jp
or
McQUERTER
Tina Wilmott, 858-450-0030 ext. 140
twilmott@mcquerter.com