August 10, 1999



TO THE SHAREHOLDERS OF ENERGY RESEARCH CORPORATION:

The  purpose  of this  letter is to remind  you that the Board of  Directors  of
Energy  Research  Corporation  has called a Special  Meeting of  Shareholders in
order to consider and act on Proposals  (i) to change the name of the Company to
FuelCell  Energy,  Inc.;  (ii) to increase  the number of  authorized  shares of
Common Stock of the Company from 8,000,000 to  20,000,000;  and (iii) to approve
the  reincorporation  of the  Company  in  the  State  of  Delaware.  The  Proxy
Statement,  which you should have received in the mail,  describes each of these
Proposals in detail.  We seek your support for these  Proposals which we believe
will enable our Company to more effectively move forward into  commercialization
of our fuel cell technology.

It is important  that you vote on the  Proposals by returning  the Proxy Card or
attending  the  Special  Meeting.   Approval  of  Proposal  (iii)  requires  the
affirmative vote of two-thirds of the outstanding  shares of Common Stock of the
Company.  For your  convenience,  if you hold your shares  through a street name
broker, you can also vote via phone by calling (800) 454-8683 or on the internet
at WWW.PROXYVOTE.COM using the control number provided on the voting instruction
sheet which was included with your proxy materials.  If your shares are not held
through a street  name  broker,  then you can only vote by mailing in your Proxy
Card to Continental  Stock Transfer & Trust  Company,  2 Broadway,  New York, NY
10275-0491 or by attending the Special  Meeting.  A return envelope was included
with your materials for your convenience.

If you have  lost or  misplaced  your  Proxy  Card,  please  contact  Jacqueline
P'erez-Ares  at  (203)  825-6075  or  by  e-mail  at  jperez-ares@ercc.com   for
assistance.

For planning  purposes,  if you will be  attending  the  shareholder  meeting on
September 2, 1999, please contact Ms. P'erez-Ares.

The  Board  of  Directors  unanimously  supports  each of  these  Proposals  and
recommends your vote in favor of each of them. Thank you for your support.


Jerry D. Leitman
President and Chief Executive Officer



YOUR VOTE IS  IMPORTANT;  FAILURE TO VOTE YOUR SHARES HELD THROUGH A STREET NAME
BROKER WILL HAVE THE EFFECT OF A VOTE AGAINST THE PROPOSALS.