Exclusive supply agreement for Australia

VPhase plc

("VPhase" or the "Company")

Exclusive supply agreement for Australia

VPhase plc, (AIM:VPHA), a leading developer of energy saving products for residential and commercial properties is delighted to announce that its subsidiary VPhase Smart Energy Limited has today entered into an exclusive distribution arrangement with Energy Home Solutions Pty Limited ("EHS") for the supply and installation of its VPhase VX1 product in Australia.

Under the arrangement, which is for an initial period of five years (and then continuing unless terminated by either party) EHS agrees to purchase a minimum quantity of the VX1 product in each year of the agreement. The agreement anticipates achieving minimum volumes to a value of £12.4 million over the initial five year period. The volumes are not spread evenly but scale up over the term of the agreement. Failure by EHS to meet the minimum quantity in any year of the agreement would enable the Company to terminate the agreement. The first call-off order for 500 VPhase units has been placed and these units will be taken over the next six months after which growth is anticipated to meet the minimum volumes as the market develops.

The Australian market comprises some 9.19 million homes and the average domestic electricity consumption is c.50% higher than in the UK at 6,570kWh per home. This coupled with generally higher unit costs for electricity makes installing a VPhase unit a very attractive proposition.

Rick Smith, CEO of VPhase commented: "This establishes an excellent way for us to access the Australian market and to build on the strong sales growth we are seeing in the UK."

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About VPhase

VPhase plc is an energy efficiency technology company that launched the first domestic voltage optimisation device in the UK. The VPhase VX1 lowers the voltage in the home, reducing the energy consumption of many electrical appliances, saving money and reducing carbon emissions.

The VPhase device:

- has been proven to save up to 12% off home electricity bills;

- is easily installed by a qualified electrician;

- does not require a change in lifestyle or electricity supplier;

- is low cost, with a typical payback of under 5 years;

- has a 5 year manufacturer's warranty and an expected lifespan in excess of 25 years;

- can save up to 4.5 tonnes of CO2 over its 25+ year life;

- attaches to the consumer unit (fuse box) and regulates the voltage to 220 volts;

- is the next most affordable and effective green option for the home, after insulation.

The VPhase VX1 has been extensively tested with independent verification supporting the saving claims, including an Ofgem approved CERT demonstration action, social housing trials and a range of independent consumer trials. Many electrical appliances in the home will benefit from having their voltage optimised and reduced, including fridges, freezers, central heating pumps, televisions, washing machines, vacuum cleaners, etc. - and even 'energy-saving' light bulbs. As well as reducing the homes electricity bill, there is evidence that the life of electrical appliances can be extended by the use of this product; light bulbs in particular, have demonstrated at least a doubling of operating life when on a voltage optimised circuit.

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