World Energy Solutions Administers Nation’s First Carbon Emissions Allowances Auction for the Regional Greenhouse Gas Initiative

Worcester, MA – September 30, 2008 – World Energy Solutions, Inc. (TSX: XWE) today announced it has successfully administered the first-in-the-nation auction for carbon dioxide (CO2) emissions allowances on behalf of the Regional Greenhouse Gas Initiative (RGGI). According to RGGI, Inc., 12,565,387 allowances were sold at the auction at a clearing price of $3.07 per allowance, netting the six RGGI states that offered allowances in this pre-compliance auction $38,575,783 in proceeds. The auction occurred on September 25, 2008.

In a previously released statement, Pete Grannis, Commissioner of the New York State Department of Environmental Conservation and Chair of the Regional Greenhouse Gas Initiative, Inc. said: “The 10 RGGI states have demonstrated great leadership in coming together to offer this first carbon cap-and-trade system, and the smooth completion of the initial auction is proof that the RGGI is leading the nation in the battle against climate change. RGGI’s example shows that an open and competitive carbon market can be implemented.” (The complete RGGI, Inc. press release can be read at: http://www.rggi.org/docs/rggi_press_9_29_2008.pdf)

Added Jonathan Schrag, Executive Director of the Regional Greenhouse Gas Initiative, Inc.: “We are grateful that the auction administered by World Energy Solutions ran flawlessly and that the monitoring conducted by Potomac Economics concluded that the auction was robust. We are very fortunate to have two top-notch firms administering and overseeing our auctions.”

“We are honored to be part of this historic and seminal event,” said Richard Domaleski, CEO of World Energy. “I am very proud of our team and the performance of our award-winning World Green Exchange®.”

Industry Flexes Muscle, Weaker Energy Bill Passes

Pared-down energy legislation cleared the Senate on Thursday by a wide margin after the oil industry and utilities succeeded in stripping out provisions that would have cost them billions. The legislation still contains a landmark increase in fuel-economy standards for vehicles and a huge boost for alternative fuels. But a $13 billion tax increase on oil companies and a requirement that utilities nationwide produce 15% of their electricity from renewable sources were left on the floor to secure Republican votes for the package.

Emissions deal to be aimed at key sectors

Businesses in energy-intensive sectors such as cement, steel and aluminium will be asked to sign up to industry-wide pacts on cutting their greenhouse gas emissions, under plans due to be agreed at an international climate change conference today. The negotiations on an international post-2012 framework will include a provision for “global sectoral agreements” aimed at industry. These will require the leading companies in certain sectors to meet and agree on targets to cut their carbon dioxide emissions.

Bali Climate Talks Draft Drop 2020 Emissions Goal

A compromise draft text to launch in Bali two years of negotiations for a global pact to fight climate change has dropped a key ambition of tough 2020 greenhouse emissions cuts for rich countries. The text, trying to end a dispute between the U.S. and the EU on the last day of two-week U.N. talks, retained an ambition for global greenhouse gas emissions to peak in the next 10-15 years and to fall well below half of 2000 levels by 2050.

Poor Nations Demand Green Technology

Poorer countries accuse the rich of pressuring them to control emissions of greenhouse gases blamed for global warming, while refusing to provide them with technology needed to do so without hurting their economies. They have made their demands that rich nations provide cheap access to green know-how a centerpiece of the U.N. climate change conference. Wealthy countries say they must consider demands of private companies for protection of their intellectual property rights, assurances they will have the opportunity to profit from their investments, and better regulation and laws in host nations.

Race for carbon-offset permits heats up

Demand for access to carbon-offset projects is rising as companies volunteer to cancel out their emissions at a faster rate than expected. The price of access to offsets looks set to rise after the second trading round for European carbon-emission permits, which begins next month. They are trading at a discount to second-round European Union carbon futures, which have already started to trade ahead of the round’s commencement in January.

Things change quickly in our industry.

While it is great to see the U.S. Congress leading by example on climate change mitigation strategies, this transaction should be seen as one small sign in a broader sea change in U.S. politics surrounding climate change.

The two leading climate bills in the Senate are bipartisan, have largely been well-received, and are designed to accommodate a post-Kyoto international emissions regime. The Lieberman/Warner bill, currently in the Senate Environment and Public Works Committee, would cap emissions to 70% below 2005 levels by 2050. The Bingaman/Specter bill, currently in the Senate Energy and Natural Resources Committee, calls for a reduction of emissions to 2006 levels by 2020 and to 1990 levels by 2030.

On the campaign trail, nearly all the leading Presidential candidates have

Stated the need for the U.S. to move forward with an emission reductions program

Agreed that domestic efforts should dovetail with a post-Kyoto framework

And internationally it is interesting to see that the U.S.’ partner in rejecting the Kyoto Protocol, Australia, appears to be on track for embracing Kyoto. Over the weekend, the newly-elected Prime Minister Kevin Rudd promised to “quickly ratify” the Kyoto protocol, which should further spur the development of carbon trading in Australia, the world’s largest per capita emitter.

How do you think all of these changes will effect the policies and rhetoric? As we’re heading towards the end of 2007 I’d love to her your 2008 predictions.

-Rick