ACE.L Regulatory News (ACE)

AUHUA CLEAN ENERGY PLC

("Auhua" or "the Company")

Auhua signs Middle East distribution agreement with Istidama LLC

25 March 2014:Auhua Clean Energy Plc (AIM: ACE) ("ACE"), the environmental technology group, is pleased to announce today that it has entered into a five-year distribution agreement ("Distribution Agreement") with Istidama LLC ("Istidama"), a United Arab Emirates-based business offering a range of services related to corporate social responsibility and sustainability. Istidama has an extensive sales and distribution network in the UAE, helping clients to match power generation requirements with clean-tech solutions.

Under the terms of the Distribution Agreement, Istidama will sell split-unit solar water heater systems supplied by ACE, with a minimum annual performance requirement of 10,000 units annually, increasing to 50,000 units over a five year period. ACE has also granted Istidama the non-exclusive right to distribute ACE's products solely in the Cooperation Council for the Arab States of the Gulf ("GCC"), which comprises Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE. The GCC contract has the potential to generate in excess of US$ 100 million revenues in the mid-term.

David Sumner, non-executive Chairman of Auhua, said: "This deal marks a significant milestone in Auhua's international expansion strategy as our first distribution deal outside of China with contracted revenues that we are confident will materialize over the next five years. We are delighted to work with Istidama which has an extensive network across the GCC and is one of the UAE's leading corporate social responsibility and sustainability consultancies. Most countries in the GCC are actively diversifying away from their dependence on hydro-carbon based fuels and are working towards sustainable economies. Abu Dhabi alone has set itself a target of achieving 7% renewable energy power generation capacity by the year 2020. We look forward to being part of this diversification together with Istidama."

Sheikh Abdul Aziz bin Ali al Nuaimi, part of the Ruling Family of the Emirate of Ajman and Board Director of Istidama, commented: "In the UAE's energy intensive economy, increasing the role of renewable energy to ensure the sustainable development of the country is a priority. Investment in solar power solutions will reap huge long-term benefits to the economy, both environmentally as well as financially, which is why we welcome collaborations between local businesses and international solar energy specialists like ACE."

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About Auhua:

Auhua Clean Energy (www.auhuacleanenergy.com) is a global environmental technology group based in the Shandong Province of Eastern China specialising in the development and application of green energy and energy efficient solar water heating solutions. In particular, the Group is focused on the manufacture and sale of split-unit solar water heating systems. Auhua Clean Energy operates through its wholly owned subsidiaries Shandong Auhua New Energy Co., Ltd and Weihua Auhua New Energy Co., Ltd., of which Auhua Holdings Pte Ltd is the intermediate holding company. 

About Istidama:

Istidama LLC (http://www.istidama.com) is a privately-owned corporate social responsibility (CSR) management consultancy company, based in Dubai, United Arab Emirates. Istidama offers a broad range of advisory, technical and consultancy services in sustainability. Istidama means "Sustainability" in Arabic and the company's vision is to support firms in achieving their expansion plans whilst simultaneously reducing their impact on the environment. This is achieved by helping clients to match power generation requirements with clean-tech solutions, implementing carbon abatement schemes, and sourcing access to private equity to fund environmentally-friendly projects.