ThermoEnergy Corp Announces First Quarter 2008 Financial Results

    KEY OPERATIONAL and FINANCIAL HIGHLIGHTS FOR 2008

    -- CASTion Water Segment Revenues Increase Over First Quarter 2007, and
       increases pipeline of new projects.
    -- CASTion Water Group hired new VP of Marketing.
    -- Management increases ownership stake in the Company with additional
       $750,000 investment
    -- Parsons-Brinkerhoff engineering study concludes TMEN's ARP Technology
       substantially reduces the carbon being released by the biological
       nitrogen removal process as compared to conventional biological
       systems, study supports the use of TMEN's ARP process.

"We are pleased with the restructuring that we experienced in our water division during the first quarter, as we continue to work to expand the CASTion pipeline for municipal contracts," stated CEO Dennis Cossey. "The Company's TIPS process continues to develop with extreme interest from multiple high level groups, including the recent announcement of our Memorandum of Understanding with Babcock Power, Inc. With the industrial side of CASTion continuing to build a backlog and our sales focus on various high scale municipalities; we believe ThermoEnergy is uniquely positioned to capitalize on the two billion dollar US water industries market.

The Company reported total operating revenue of $409,000 for the first quarter ended March 31, 2008 compared to $73,000 for the quarters ended March 31, 2007. The Company's water subsidiary CASTion reported $226,000 in revenue, while the Power Group contributed $183,000 in revenue.

The Company had total operating expenses of $1,654,000 for the first quarter 2008 compared to $821,000 for the quarters ended March 31, 2007. Over one-third of the first quarter 2008 operating expenses represented the expense of options, and other one time expenses related to the consolidation of CASTion, and discount to convertible debt. Without these one time expenses, operating expenses for the quarter were flat from year to year including the increased staff from the CASTion acquisition and additional hires to help promote the ARP technology solution. Management believes that current operating expenses will support revenue and sales expected for the remaining of the year.

Loss per share was $.05 per share for the first quarter 2008, compared to the loss per share of $.03 for the same period in 2007.

"ThermoEnergy made significant strides in the first quarter, moving CASTion towards a break even run rate after some post acquisition restructuring," stated, CEO Dennis Cossey. "We believe David Delasanta, who we brought on as our VP of Sales and Marketing provides added depth to our sales force with his extensive experience and contacts in the water industry. We expect CASTion to continue to expand its industrial sales of our water solutions while we remain in talks to solidify our first municipal projects ground breaking date. The realization that green house gas emissions are being excreted by wastewater treatment plants using biological nitrogen removal agents combined with new knowledge brought to light by the Parsons-Brinkerhoff report has created a sense of urgency in many municipalities to speak with us regarding our proprietary ARP process."

About ThermoEnergy Corporation

ThermoEnergy Corporation is a diversified technologies company engaged in the worldwide commercialization of patented and/or proprietary municipal and industrial wastewater treatment and power generation technologies. The wastewater treatment technologies are consolidated in our subsidiary, CASTion Corporation ("CASTion"), a fast growing developer and manufacturer of innovative wastewater treatment and recovery systems to industrial and municipal clients. The systems are unique because they meet environmental regulations while providing a rapid return on investment by recovering and reusing expensive feedstock's, reducing contaminated wastewater discharge and reusing wastewater in process operations. CASTion's wastewater treatment systems have application in aerospace, food processing, metal finishing, refineries, manufacturing and municipal wastewater. We assemble and ship our waste water treatment products from our 20,000 square foot manufacturing facility inWorcester, Massachusetts. The power generation technologies are consolidated in our subsidiary, ThermoEnergy Power Systems, LLC ("TEPS"). The economic and environmental matrix of the Company's technologies represents a paradigm shift in these key infrastructure industries. The Company currently has offices inLittle Rock, AR,Worcester, MA,Hudson, MA, andNew York, NY, Jacksonville, FL andBaton Rouge, LA. Additional information on the Company and its technologies can be found on its website at (www.thermoenergy.com), or (www.castion.com) for wastewater treatment specific information.

THIS PRESS RELEASE INCLUDES STATEMENTS THAT MAY CONSTITUTE "FORWARD LOOKING" STATEMENTS, USUALLY CONTAINING THE WORD "BELIEVE", "ESTIMATE", "PROJECT", "EXPECT" OR SIMILAR EXPRESSIONS. FORWARD LOOKING STATEMENTS INHERENTLY INVOLVE RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE FORWARD LOOKING STATEMENTS. FACTORS THAT WOULD CAUSE OR CONTRIBUTE TO SUCH DIFFERENCES INCLUDE, BUT ARE NOT LIMITED TO, CONTINUED ACCEPTANCE OF THE COMPANY'S PRODUCTS AND SERVICES IN THE MARKETPLACE, COMPETITIVE FACTORS, CHANGES IN REGULATORY ENVIRONMENTS AND OTHER RISKS DETAILED IN THE COMPANY'S PERIODIC REPORT FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION. BY MAKING THESE FORWARD LOOKING STATEMENTS, THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE THESE STATEMENTS FOR REVISIONS OR CHANGES.

    Investor Contact:
    Alliance Advisors, LLC
    Mark McPartland or Bryan Kobel
    212-398-3487
    markmcp@allianceadvisors.net
    bkobel@allianceadvisors.net

SOURCE ThermoEnergy Corp

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