Tokyo, Japan - August 23, 1999

Yokogawa Electric Group and Echelon Announce Strategic Alliance
-Companies to jointly promote open systems to the industrial market-

Echelon Corporation (NASDAQ: ELON) and Yokogawa Electric Group (refer to YOKOGAWA) announced today that they will work together on a worldwide basis to promote the use of open interoperable LONWORKS^® control networks in the factory and process automation markets. With fiscal 1998 sales of over $2.3 billion, Yokogawa Electric Corporation is one of the worlds leading suppliers of solutions to industries and enterprises. The centerpiece of the companies' cooperation is Yokogawa joining the LONMARK^® Interoperability Association as a sponsor member, the first Japanese company to join at this top membership level. The LONMARK Association promotes the interoperable use Echelon's LONWORKS system and counts among its over 200 members some of the world's leading building, industrial, home, and transportation automation companies. As a sponsor member, Yokogawa will join the association's Board of Directors. 

To accelerate the availability of LONWORKS products from the Yokogawa Group, Yokogawa M&C Corporation (refer to Yokogawa M&C) has been designated as the "LONWORKS Center of Excellence" for the Yokogawa Group. This center, with support from Echelon and the LONMARK Interoperability Association, will actively develop for Yokogawa a wide range of LONMARK compliant sensors, actuators and controllers. Yokogawa intends to provide software plug-ins for Echelon's LNS network operating system with all of their products to allow them to be easily engineered and commissioned with LNS based tools such as Echelon's LonMaker™ for Windows integration tool.

"In the industrial automation arena the importance of open systems has dramatically increased for the past several years," said Mr.Hiromasa Ikematsu, President of Yokogawa M&C. "As a leader of the industry, Yokogawa Group has been proactively involved with the promotion of open systems. The LONMARK guidelines and Echelon's LONWORKS networks have been recognized as the de-facto standard in Japan as well as U.S. and Europe. Yokogawa Group would like to leverage our agreement with Echelon to promote open systems based on LONMARK products in Japan and the global market. As the Yokogawa Group, we are aimed at generating some 10 billion yen in 5 years out of the LONWORKS business." 

"Yokogawa Electric Group is a recognized world leader in factory and process automation and we are pleased to welcome them as a LONMARK sponser", said M. Kenneth Oshman, Echelon's president and chief executive officer. "We believe that their particpation in the association will make an important difference in promoting open systems based on LONWORKS networks and LONMARK products. We appreciate their commitment and look forward to working with Yokogawa M&C to insure successful development of their LONMARK products." 

"LONMARK membership in the Asia-Pacific region has been growing steadily over the past year and currently accounts for almost 10% of the overall membership", said Paula Skokowski, executive director of the LONMARK Interoperability Association. "With Yokogawa's new initiatives and decision to become a LONMARK sponsor member, we believe that open system based on LONMARK products will gain further momentum not only in Japan and Asia-Pacific, but throughout the world."

About Yokogawa M&C Corporation
Founded in 1996, Yokogawa M&C Corporation (Yokogawa M&C,1-19,18, Naka-cho, Musashino-shi, Tokyo, Japan President and CEO ; Hiromasa Ikematsu) is one of the key company of Yokogawa group and world's PA and FA products supplier to industries and enterprises. The company is dedicated to promoting the quality, efficiency and profitability of enterprise customers around the globe by providing the most reliable measurement instruments, control & environmental products and energy saving support. Yokogawa M&C facilities in Japan consisting of 9 offices, and 2 affiliates are complemented by using Yokogawa global sales network. News and information are available at http://www.yokogawa.co.jp/MCC/.