Question:

Has Capstone ever considered making its service plan a mandatory inclusion on all turbine sales?

Answer from Capstone Management:

Management believes making service plans mandatory would garner a negative market reaction from our valued current and potential customers. We believe that most customers will adopt the Factory Protection Program over time as the value proposition and risk profile is very attractive when compared to self performing maintenance on a time and material basis.

Question:

Has Capstone considered marketing the turbines to Foss on their new Hybrid Tugs? The last CARB report in 2010 shows promise for hybrid tugs; microturbines would be a perfect fit for this application.

Answer from Capstone Management:

Yes, Capstone is actively pursuing several marine applications including both workboats and pleasure craft.

Question:

It has been reported that Hiwig Mfg. in China is selling turbines similar to Capstones. Are they infringing on our patents or are they authorized? What is Capstone doing about it?

Answer from Capstone Management:

Capstone has no relationship with Hiwig Manufacturing in China. Management is actively monitoring the situation and has found no record of actual microturbine quotations or sales. Any sales of microturbines in the U.S. or Europe would most likely violate several Capstone patents. Capstone will continue to monitor the situation and use any and all legal remedies if our patents are in fact infringed upon.

Question:

How does the Capstone microturbine handle vehicular vibration in comparison to a zero vibration stationary machine?

Answer from Capstone Management:

The Capstone microturbine itself can handle very high vibration and shock loads. The long-term area of concern is the power electronics module. Capstone currently has a program to water cool and “harden” the current power electronics for vehicular applications.

Question:

I noticed in the Q1 conference call, that you were trying for a 30% federal rebate level for MTs to match that of other green energy producers. While it would be good to be playing on an even level rebate playing field, might it not be better to have an end goal of zero rebates for all, since the rebate on a Bloom Box fuel cell, for instance would be 30% of $7000/kW or $2100/kW. The government is in effect giving more than the price of a kW of Capstone MT as a rebate for competing product!

Answer from Capstone Management:

Management is not looking to build a business based upon unpredictable government incentives. However, Management is looking to “level the playing field” with other clean energy technology. Introducing a bill to increase the current investment tax credit for microturbines from today’s 10% to 30% is the most expeditious way of achieving that goal.