Echelon Speeds Development of Home Automation Products with Introduction of Power Line Chip Featurin

Echelon's New Smart Chip Simplifies Development of Next Generation Products for Energy Management, Home Monitoring and Control by Consumers and Utilities

(SAN JOSE, CA - April 3, 2007) - Echelon Corporation (NASDAQ: ELON), a leading provider of networking technology that is used to manage and reduce energy consumption, today announced a new power line based integrated circuit that promises to speed and simplify the creation of consumer friendly home automation products. Echelon's PL 3170 Power Line Smart Transceiver allows manufacturers to create networked home control products that install automatically when plugged into a wall - eliminating the fear and technology complexity that consumers associate with home automation. This new power line smart transceiver is the latest addition to the company's LonWorks® products and Digital Home® (www.digitalhome.com) technologies - hardware and software products that are helping to drive the worldwide home automation market.

"Energy management is the key driver for home automation, and the devices that can help make a home more energy efficient - lights, fans, blinds, smart appliances, furnaces, air -conditioners, and power outlets - are already connected to the power wiring. With our power line technology, these devices are already connected to the network," said Bea Yormark, Echelon's president and COO. "The new power line smart chip adds automatic installation to what is, hands down, the most reliable solution on the home automation market today. Now manufacturers have a 'no new wires' home automation solution that's also low cost, easy -to -develop, and doesn't require the help of an installer or electrician to install." Echelon's automatic installation software is known as Interoperable Self -Installation (ISI).
Echelon's PL 3170 Smart Transceiver combines the industry's leading power line signaling technology with an applications processor and ISI software - all in a single chip. The new chip also allows appliance manufacturers to easily and inexpensively create products in accordance with the CECED (European Committee of Manufacturers of Domestic Appliances) Household Appliances Control and Monitoring - Application Interworking Specification (AIS) standard. The PL 3170 Smart Transceiver can be used in conjunction with Echelon's full range of LonWorks products, or independently.
The PL 3170 Power Line Smart Transceiver will be available in summer of 2007. Contact Echelon for volume pricing.

More About Echelon's ISI and Power Line Technology
Reflecting a breakthrough in simplicity and ease -of -use, Echelon's ISI technology makes adding multi -zone lighting, multi -zone heating control, and pool/spa controls as simple as plugging in a power cord. Devices equipped with ISI software are ideally suited to the home environment because they do not need specialized software or programming to work. As soon as power is applied or a "service" function is activated, the devices discover one another and configure themselves into fully functional control systems. System changes, such as the addition of a new device or changing a lighting scene, can take place at any time without any expertise or training on the part of the user.
In addition to normal operation, Echelon's Power Line Smart Transceivers provide reliable, bidirectional communications over switched -leg circuits, a common occurrence in over 50% of American homes when the Neutral wire is missing. Another unique feature of Echelon's Power Line Smart Transceivers involves its ability to measure electricity. Echelon chips installed in switches, outlets, plug -in modules and other popular products can share energy consumption information with consumers and utilities to help better manage energy in homes. More information about power line control networking can be found at http://www.echelon.com/products/oem/transceivers/smartpl/default.htm.

More About the Digital Home Alliance
The Digital Home Alliance (DHA) was formed to offer consumers a new generation of networkable home automation products based on Echelon's market -leading LonWorks control networking technology. Its members are committed to creating intuitive and affordable products that can be easily connected in a home automation network. DHA offers installers an unprecedented opportunity to deliver value -added products and services to consumers. When consumers see the Digital Home logo on a product that has met DHA standards, they'll know that it will work seamlessly - right out of the box - with any other Digital Home product in their home automation network. More information on the Digital Home Alliance can be found at www.digitalhome.com.

About Echelon Corporation
Echelon Corporation (NASDAQ:ELON) is a networking company that provides products and systems that can monitor and save energy, lower costs, improve productivity and enhance service, quality, safety and convenience by networking together everyday devices in utility, building, industrial, transportation and home control systems. Tens of millions of smart devices based on Echelon's LonWorks products and Networked Energy Services (NES) systems are in use around the world today bringing benefits to consumers and industry. More information about Echelon can be found at http://www.echelon.com.

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