ECHELON ANNOUNCES PRICE AND PERFORMANCE BREAKTHROUGHS WITH NEW POWER LINE TRANSCEIVER

Palo Alto, California -- March 30, 1999 - Echelon Corporation (NASDAQ: ELON), a leading provider of LONWORKS® control network solutions worldwide, today announced its third-generation power line communication transceiver, the PLT-22. Priced twenty percent lower than the device it replaces, the PLT-22 offers unprecedented performance and reliability through a new Dual Frequency Carrier feature that automatically selects an alternate signaling frequency should the primary frequency be jammed. This feature is especially important for delivering "plug and play" operation in home applications where very high reliability must be achieved in the presence of electrically noisy consumer electronics, personal computers, and appliances.

When the PLT-22 transceiver's Dual Frequency Carrier mode is enabled, devices using the PLT-22 are able to communicate even when their primary signaling frequency is blocked by noise. This is possible because the PLT-22 automatically switches to a back-up frequency if it finds that the primary frequency is blocked.

In addition to the Dual Frequency Carrier feature, the PLT-22 incorporates advanced digital signal processing and error correction to ensure reliable operation. The PLT-22 meets international standards in North America, Europe, and Asia, allowing OEMs to use the same basic product design worldwide. It is also backward-compatible with the PLT-20 and PLT-21 devices it replaces, permitting OEMs to achieve enhanced performance and cost savings without redesigning their products.

"The cost and performance enhancements of the PLT-22 make possible a wide range of LONWORKS based consumer applications," said Raphael Reich, Echelon product marketing manager. "By embedding the low-cost PLT-22 in Internet gateways, set-top boxes, appliances, lighting controls, and electric meters, OEMs can obtain robust and reliable communication over the home's power mains to devices. When combined with the complete LONWORKS system end-to-end architecture, OEMs can deliver new value-added services to consumers and reduce their product support costs. We have already seen examples of this based on our previous generation of transceivers in recent announcements from appliance manufacturer Merloni Elettrodomestici, set-top box maker Teknema, and electric switch manufacturer BPT. We expect the PLT-22 to accelerate the deployment of innovative home networking and automation products."

Samples of the new transceiver are shipping now, with volume shipments slated for May. Echelon's PLT line of transceivers can be found in utility, home, building and industrial applications around the globe. For examples of these applications, visit Echelon's case study library at http://www.echelon.com/Solutions/stories .

For technical background and ordering information, please contact your Echelon sales representative or visit us on the Web at http://www.echelon.com .

About Echelon Corp. Echelon Corporation (NASDAQ: ELON) is the developer of LONWORKS networks, recognized internationally as a standard for interoperable control networks. With thousands of application developers and millions of devices installed worldwide, the LONWORKS system is a leading open, networked control solution for building and home automation, industrial, transportation, and public utility applications. Echelon offers a full range of off-the-shelf hardware and software products to support the development, installation and management of intelligent, open and interoperable control networks. Echelon is based in Palo Alto, California with international offices in China, France, Germany, Japan, Korea, The Netherlands and the United Kingdom. News and information are available at http://www.echelon.com .

Echelon, LONWORKS, and the Echelon logo are registered trademarks of Echelon Corporation registered in the U.S. and other countries.

This press release may contain statements relating to future plans, events or performance. Such statements may involve risks and uncertainties, including risks associated with uncertainties pertaining to the timing and level of customer orders, demand for products and services, development of markets for Echelon's products and services, and other risks identified in Echelon's SEC filings. Actual results, events and performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Echelon undertakes no obligation to release publicly the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

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