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UNITED STATESSECURITIES
AND EXCHANGE COMMISSIONWASHINGTON, DC 20549

FORM 10-QSB

(Mark One)x  Quarterly Report Pursuant
  To Section 13 Or 15(d) Of The Securities Exchange Act Of 1934
  For the quarterly period ended September 30, 2005

 ̈ Transition
  Report Under Section 13 Or 15(D) Of The Securities Exchange Act Of 1934
  For the transition period from _____ to _____

Commission File Number:000-26047

ENCORE CLEAN ENERGY,
INC.(Exact Name of Small Business Issuer as Specified in Its
Charter)

|Nevada                          | 65-0609891         
|------------------------------- | -------------------
|(State or Other Jurisdiction of | (I.R.S. Employer   
|Incorporation or Organization)  | Identification No.)

Suite 610  375 Water StreetVancouver, British
Columbia, Canada V6B 5C6(Address of Principal Executive Offices)

(604) 801-5566(Issuer's Telephone Number,
Including Area Code)

Not Applicable(Former Name, Former Address and
Former Fiscal Year, if Changed Since Last Report)

Check whether the issuer: (1) filed all reports required to be
  filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or
  for such shorter period that the registrant was required to file such reports),
  and (2) has been subject to such filing requirements for the past 90 days. Yes xNo  ̈

Indicate by check mark whether the registrant is a shell company
  (as defined in Rule 12b-2 of the Exchange Act). Yes  ̈ No x

State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date: 15,906,975
shares of common stock, $0.001 par value per share, issued and outstanding as of
November 30, 2005.

Transitional Small Business Disclosure Format (check one): Yes  ̈ No x

1

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ENCORE CLEAN ENERGY, INC. AND SUBSIDIARIESFORM
10-QSBQUARTERLY PERIOD ENDED SEPTEMBER 30, 2005INDEX

|                                                                                                                                                 | Page
|------------------------------------------------------------------------------------------------------------------------------------------------ | ----
|                                                                                                                                                 |     
|PART I - FINANCIAL INFORMATION                                                                                                                   | 3   
|                                                                                                                                                 |     
|Item 1  Consolidated
      Financial Statements For the Three and Nine Months Ended September 30, 2005
      and September 30, 2004 (unaudited) | 3   
|                                                                                                                                                 |     
|Item 2 - Management's Discussion
      and Analysis or Plan of Operation                                                                         | 4   
|                                                                                                                                                 |     
|Item 3 - Controls and
      Procedures                                                                                                           | 13  
|                                                                                                                                                 |     
|PART II - OTHER INFORMATION                                                                                                                      | 14  
|                                                                                                                                                 |     
|Item 1 - Legal Proceedings                                                                                                                       | 14  
|Item 2 - Unregistered Sales of Equity Securities
      and Use of Proceeds                                                                       | 14  
|Item 3 - Defaults Upon
      Senior Securities                                                                                                   | 14  
|Item 4 - Submission of Matters to a Vote
      of Security Holders                                                                               | 14  
|Item 5 - Other Information                                                                                                                       | 15  
|Item 6 - Exhibits and Reports on Form 8-K                                                                                                        | 15  
|                                                                                                                                                 |     
|Signatures                                                                                                                                       | 17  

2

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PART I. FINANCIAL INFORMATION

|ITEM 1. | FINANCIAL STATEMENTS
|------- | --------------------

3

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Encore Clean Energy, Inc.Consolidated Balance Sheet (unaudited) 
  expressed in United States dollars)

|                                                                                        |   | September 30, |  
|--------------------------------------------------------------------------------------- | - | ------------- | -
|                                                                                        |   | 2005          |  
|                                                                                        |   |               |  
|Assets                                                                                  |   |               |  
|                                                                                        |   |               |  
|Current assets:                                                                         |   |               |  
|Cash and
      cash equivalents                                                         | $ | 165           |  
|Investment                                                                              |   | 14,966        |  
|Accounts
      receivable                                                               |   | 130,290       |  
|Prepaid expenses                                                                        |   | 28,801        |  
|Other assets                                                                            |   | 2,193         |  
|Deferred tax asset less valuation allowance of $1,663,200                               |   | -             |  
|                                                                                        |   |               |  
|Total current assets                                                                    |   | 176,415       |  
|                                                                                        |   |               |  
|Property and equipment,
      less accumulated depreciation                             |   | 61,290        |  
|                                                                                        |   |               |  
|TOTAL ASSETS                                                                            | $ | 237,705       |  
|                                                                                        |   |               |  
|Liabilities and Deficiency in Assets                                                    |   |               |  
|                                                                                        |   |               |  
|Current liabilities:                                                                    |   |               |  
|Bank indebtedness                                                                       | $ | 95,159        |  
|Accounts payable and accrued
      liabilities                                          |   | 2,060,761     |  
|Credit facility                                                                         |   | 380,368       |  
|Due to related parties -
      current portion                                          |   | 1,284,773     |  
|Capital lease obligation
      - current portion                                        |   | 7,324         |  
|                                                                                        |   |               |  
|Total current liabilities                                                               |   | 3,828,385     |  
|                                                                                        |   |               |  
|Due to related parties                                                                  |   | 1,293,204     |  
|Minority interest                                                                       |   | 100,000       |  
|Capital lease obligations                                                               |   | 5,181         |  
|                                                                                        |   |               |  
|Total liabilities                                                                       |   | 5,226,770     |  
|                                                                                        |   |               |  
|Deficiency in assets:                                                                   |   |               |  
|Common stock, .001 par value;
      18,000,000 share authorized; 14,406,975             |   |               |  
|issued
      and outstanding                                                            |   | 14,407        |  
|Series A convertible preferred
      shares, .001 par value; 300,000 shares authorized; |   |               |  
|300,000
      issued                                                                    |   | 150,000       |  
|Additional paid-in capital                                                              |   | 6,347,381     |  
|Deficit                                                                                 |   | (10,930,761   | )
|Accumulated other comprehensive loss                                                    |   | (570,092      | )
|                                                                                        |   |               |  
|Total deficiency in assets                                                              |   | (4,989,065    | )
|                                                                                        |   |               |  
|TOTAL LIABILITIES
      AND DEFICIENCY IN ASSETS                                        | $ | 237,705       |  

See accompanying notes to unaudited consolidated financial statements

F1

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Encore Clean Energy, Inc.Consolidated Statements of Operations (unaudited)
  (expressed in United States dollars)

Three Months Ended
      
      
      Nine Months EndedSeptember 30,
      
      
      September 30,
      
      
      September 30,
      
      
      September 30,2005
      
      
      2004
      
      
      2005
      
      
      2004Revenue
      $
      646,999
      
      $
      561,613
      
      $
      2,047,359
      
      $
      2,006,849Cost of revenue
      
      558,933
      
      
      370,976
      
      
      1,589,971
      
      
      1,392,572Gross profit
      
      88,066
      
      
      190,637
      
      
      457,388
      
      
      614,277Operating expenses:Depreciation
      
      6,166
      
      
      7,194
      
      
      14,982
      
      
      22,608Salaries and benefits
      
      165,269
      
      
      170,767
      
      
      475,790
      
      
      520,754Legal and accounting
      
      78,126
      
      
      22,407
      
      
      149,679
      
      
      112,021Consulting fees andcomputer
        services
      
      161,746
      
      
      106,070
      
      
      539,195
      
      
      380,929Phones and utilities
      
      4,979
      
      
      5,806
      
      
      16,414
      
      
      17,661Rent
      
      29,866
      
      
      26,659
      
      
      87,436
      
      
      92,558Advertising and promotion
      
      5,014
      
      
      3,114
      
      
      106,648
      
      
      9,848Other selling, generaland
        administrative
      
      34,787
      
      
      23,176
      
      
      100,731
      
      
      55,490Total operating expenses
      
      485,953
      
      
      365,193
      
      
      1,490,875
      
      
      1,211,869Loss from operations
      
      (397,887
      )
      
      (174,556
      )
      
      (1,033,487
      )
      
      (597,592
      )Interest expense
      
      (91,109
      )
      
      (77,116
      )
      
      (365,321
      )
      
      (224,106
      )Loss before taxes
      
      (488,996
      )
      
      (251,672
      )
      
      (1,398,808
      )
      
      (821,698
      )Provision for income
        taxes
      
      -
      
      
      -
      
      
      -
      
      
      -Net loss
      
      (488,996
      )
      
      (251,672
      )
      
      (1,398,808
      )
      
      (821,698
      )Deficit, beginning
        of period
      
      (10,441,765
      )
      
      (6,722,084
      )
      
      (9,531,953
      )
      
      (6,152,058
      )Deficit, end of
        period
      $
      (10,930,761
      )
      $
      (6,973,756
      )
      $
      (10,930,761
      )
      $
      (6,973,756
      )Net loss per common share,basic and diluted
      $
      (0.04
      )
      $
      (0.02
      )
      $
      (0.10
      )
      $
      (0.06
      )Weighted average commonshares outstanding, basicand diluted
      
      14,406,975
      
      
      12,840,528
      
      
      14,406,975
      
      
      12,840,528


See accompanying notes to the unaudited consolidated financial
  statements

F2

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Encore Clean Energy, Inc.Consolidated Statements of Cash Flows (unaudited)
  (expressed in United States dollars)

|                                                                      |   | Nine Months Ended |  
|--------------------------------------------------------------------- | - | ----------------- | -
|                                                                      |   | September 30,     |  
|                                                                      |   | 2005              |  
|                                                                      |   |                   |  
|Cash flows from operating activities:                                 |   |                   |  
|Net loss                                                              | $ | (1,398,808        | )
|Adjustments to reconcile
      net loss to net cash used in operating |   |                   |  
|activities:                                                           |   |                   |  
|Depreciation                                                          |   | 14,983            |  
|Loss on settlement of accounts receivable                             |   | 20,305            |  
|Stock based compensation                                              |   | 21,678            |  
|Common stock issued for services                                      |   | 92,050            |  
|Accrual of consulting fees                                            |   | 180,000           |  
|Write-down of investment                                              |   | 16,364            |  
|Changes in operating assets
      and liabilities:                    |   |                   |  
|Decrease (increase) in accounts receivable                            |   | (45,377           | )
|Decrease in prepaid expenses and other assets                         |   | (18,205           | )
|Increase in accounts payable and accrued liabilities                  |   | 206,318           |  
|Net cash used in operating
      activities                           |   | (910,692          | )
|                                                                      |   |                   |  
|Cash flows used in investing activities:                              |   |                   |  
|Purchase of property and
      equipment                              |   | (6,222            | )
|Net cash used in investing
      activities                           |   | (6,222            | )
|                                                                      |   |                   |  
|Cash flows from financing activities:                                 |   |                   |  
|Principal
      payments on obligations under capital leases          |   | (1,608            | )
|Proceeds from (repayment
      of) bank indebtedness                  |   | 71,054            |  
|Proceeds
      from credit facility                                   |   | (3,616            | )
|Proceeds from notes payable                                           |   | -                 |  
|Cash received
      from issuance of LLC subsidiary units to          |   |                   |  
|minority shareholders                                                 |   | 100,000           |  
|Proceeds
      from preferred share offering                          |   | 150,000           |  
|Proceeds from loans payable                                           |   | -                 |  
|Advances from related
      parties, net                              |   | 378,031           |  
|Net cash provided by financing
      activities                       |   | 693,861           |  
|                                                                      |   |                   |  
|Effect of exchange
      rate on cash                                 |   | 223,218           |  
|Increase (decrease) in cash                                           |   | 165               |  
|                                                                      |   |                   |  
|Cash, beginning of period                                             |   | -                 |  
|                                                                      |   |                   |  
|Cash, end of period                                                   | $ | 165               |  
|                                                                      |   |                   |  
|Supplementary information:                                            |   |                   |  
|Interest paid                                                         | $ | 308,300           |  
|Income taxes
      paid                                               |   | -                 |  
|Investment received on settlement
      of accounts receivable        |   | 30,605            |  
|Shares issued
      on conversion of note                             |   | 66,000            |  
|Accounts payable settled for shares                                   |   | 100,000           |  

See accompanying notes to the unaudited consolidated financial
  statements.

F3

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ENCORE CLEAN ENERGY, INC. AND SUBSIDIARIESNOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  Expressed in United States DollarsSeptember 30, 2005

|1. | The Company and Description of Business:
|-- | ----------------------------------------

Encore Clean Energy, Inc. (the Company) was originally
  incorporated on May 12, 1995, under the laws of the State of Florida. On May
  13, 2002, the Company changed its state of jurisdiction to Delaware. On December
  1, 2003, the Company merged with, Cryotherm, Inc., now a wholly-owned subsidiary,
  under the laws of Delaware and changed its name to Encore Clean Energy, Inc.

The Company is currently engaged in the following business:

| | (a) | The business of creating and commercializing products
        that generate electricity without burning fossil fuels; and                                                         
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (b) | The provision of permission-based e-mail
        marketing and integrated advertising strategies services through its wholly-owned
        subsidiary Ignite Communications Inc.

|2. | Liquidity and Future Operations:
|-- | --------------------------------

The Company incurred a net loss in the quarter ending September
  30, 2005, and has sustained negative cash flows from operations since its inception.
  At September 30, 2005, the Company has negative working capital of $3,651,970.
  The Company's ability to meet its obligations in the ordinary course of business
  is dependent upon its ability to increase profitable operations or to obtain
  additional funding through public or private equity financing, collaborative
  or other arrangements with corporate sources, or other sources. Management is
  seeking to increase revenues through continued marketing of its services; however
  additional funding will be required.

Management is working to obtain sufficient working capital from
  external sources in order to continue operations. There is however no assurance
  that the aforementioned events, including the receipt of additional funding,
  will occur and be successful which raises substantial doubt about its ability
  to continue as a going concern. Failure to generate sufficient cash flow will
  require the Company to amend or reduce operations.

|3. | Basis of Presentation:
|-- | ----------------------

The unaudited consolidated financial statements of the Company
  at September 30, 2005, and for the nine month period then ended include the
  accounts of the Company and its wholly-owned subsidiaries and reflect all adjustments
  (consisting only of normal recurring adjustments) which are, in the opinion
  of management, necessary for a fair presentation of the financial position and
  operating results for the interim periods. Certain information and footnote
  disclosures normally included in financial statements prepared in conformity
  with generally accepted accounting principles in the United States of America
  have been condensed or omitted in these interim statements under the rules and
  regulations of the Securities and Exchange Commission ("SEC"). Accounting policies
  used in fiscal 2005 are consistent with those used in fiscal 2004. The results
  of operations for the nine months ended September 30, 2005, are not necessarily
  indicative of the results for the entire fiscal year ending December 31, 2005.
  These interim financial statements should be read in conjunction with the financial
  statements for the fiscal year ended December 31, 2004, and the notes thereto
  included in the Companys Annual Report on Form 10-KSB.

F4

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ENCORE CLEAN ENERGY, INC. AND SUBSIDIARIESNOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  Expressed in United States DollarsSeptember 30, 2005

|4. | Foreign Currency:
|-- | -----------------

The functional currency of the operations of the Company's wholly-owned
  Canadian operating subsidiaries is the Canadian dollar. Assets and liabilities
  measured in Canadian dollars are translated into United States dollars using
  exchange rates in effect at the balance sheet date with revenue and expense
  transactions translated using average exchange rates prevailing during the period.
  Exchange gains and losses arising on this translation are excluded from the
  determination of income and reported as foreign currency translation adjustment
  (which is included in accumulated other comprehensive loss) in stockholders'
  deficit.

|5. | Net Loss Per Share:
|-- | -------------------

Basic net loss per share is computed using the weighted average
  number of common stock outstanding during the periods. Diluted net loss per
  share is computed using the weighted average number of common and potentially
  dilutive common stock outstanding during the period. Basic and diluted net loss
  per share are the same as any exercise of all outstanding options or warrants
  would be anti-dilutive.

|6. | Related Party
|-- | -------------

During the nine months ended September 30, 2005, the Company
  obtained financing from related parties totaling $497,656 with no fixed terms
  of repayment.

F5

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ENCORE CLEAN ENERGY, INC. AND SUBSIDIARIESNOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTSExpressed in United States DollarsSeptember 30, 2005

|7. | Comprehensive Income (Loss):
|-- | ----------------------------

Comprehensive loss for each of the periods presented is as follows:

Three Months Ended September 30, 2005
      
      
      Three Months Ended September 30, 2004
      
      
      Nine Months Ended September 30, 2005
      
      
      Nine Months Ended September 30, 2004Net
        loss
      $
      (
        488,996
      )
      $
      (
        261,440
      )
      $
      (
        1,398,808
      )
      $
      (
        821,698
      )Other comprehensive income/ (loss): Foreign currency translation
        adjustment
      
      ( 118,798
      )
      
      35,955
      
      
      ( 84,281
      )
      
      9,134Comprehensive
        loss
      $
      (
        640,054
      )
      $
      (
        215,717
      )
      $
      (
        1,483,091
      )
      $
      (
        812,564
      )


|8. | Segmented Information
|-- | ---------------------

The Company has two segments although only one operating segment
  has reportable activity at this time. This segment controls advertising services
  and commercializing products that generate electricity without burning fossil
  fuels, and the chief operating decision maker makes decisions about allocating
  resources based on each operating segment. All of the Companys sales relate
  to the advertising services operating segment and are to Canadian customers.
  Substantially all of the Companys assets are located in Canada.

F6

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ENCORE CLEAN ENERGY, INC. AND SUBSIDIARIESNOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  Expressed in United States DollarsSeptember 30, 2005

|9. | Commitment
|-- | ----------

Effective June 1, 2005, we entered into consulting contracts
  with two companies resident in Canada (each a Canadian Consultant)
  for the provision of investor relations services. Each of these contracts calls
  for the Canadian Consultant to be paid fees in the amount of $4,500 per month,
  payable by the issuance of 10,000 shares of our common stock, which shares are
  to be issued to the Canadian Consultants on a quarterly basis. As a result,
  effective July 15, 2005, we issued an aggregate of 60,000 shares of our common
  stock (30,000 shares each) to the Canadian Consultants.

Effective July 15, 2005, we entered into an additional consulting
  contract with a company resident in the United States (the US Consultant),
  also for the provision of investor relations services. The contract calls for
  the US consultant to be paid fees of $3,000 US per month, plus an additional
  equity based consulting fee of $20,000 per each three month period, payable
  by the issuance of 100,000 shares of our common stock, which shares are to be
  issued at the end of each such three month period. As a result, effective July
  15, 2005, we issued an aggregate of 100,000 shares of our common stock to the
  US Consultant.

Effective August 29, 2005, we entered into an additional letter
  agreement with a related party assigning all of their interest in the MPG technology.
  In consideration we issued warrants to purchase 1,500,000 shares of common stock
  at $0.20 per share. As of the date of this filing no change to the status of
  this agreement has occurred.

Effective September 9, 2005, we have entered into a development
  and license agreement with ISE Corporation to build a prototype unit of the
  MPG to be used as a prime electric generator in hybrid-electric Heavy Duty Motor
  Vehicles. For this effort, the Company will pay $260,000 payable in two installments
  of $100,000 within the next 60 and 120 days respectively and the final installment
  for the first phase within the next 180 days. If the first phase is successful,
  we will also fund the second phase currently estimated at $600,000.

F7

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ENCORE CLEAN ENERGY, INC. AND SUBSIDIARIESNOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
  Expressed in United States DollarsSeptember 30, 2005

|10. | Subsequent Event
|--- | ----------------

On October 21, 2005, the Companys state of incorporation
  relocated from Delaware to Nevada and our authorized capital increased to 100,000,000
  shares of Common Stock and 20,000,000 shares of preferred stock.

On October 21, 2005, each share of our Series A Convertible Preferred
  Stock outstanding was converted into five shares of our Common Stock and warrants
  to purchase an additional five shares of our Common Stock at a price of $0.25
  per share. We had 300,000 shares of Series A Stock outstanding. As such, we
  issued 1,500,000 shares of our Common Stock and Series A Warrants to acquire
  an aggregate of 1,500,000 additional shares of Common Stock at a price of $0.25
  per share.

F8

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|ITEM 2. | MANAGEMENT'S DISCUSSION AND ANALYSIS
      OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS.
|------- | --------------------------------------------------------------------------------------------------
|

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS

Certain statements contained in this Form 10-QSB constitute
"forward-looking statements". These statements, identified by words such as
plan, "anticipate," "believe," "estimate," "should," "expect" and similar
expressions include our expectations and objectives regarding our future
financial position, operating results and business strategy. These statements
reflect the current views of management with respect to future events and are
subject to risks, uncertainties and other factors that may cause our actual
results, performance or achievements, or industry results, to be materially
different from those described in the forward-looking statements. Such risks and
uncertainties include those set forth under this Item 2. "Management's
Discussion and Analysis or Plan of Operation" and elsewhere in this Form 10-QSB.
We do not intend to update the forward-looking information to reflect actual
results or changes in the factors affecting such forward-looking information. We
advise you to carefully review the reports and documents we file from time to
time with the Securities and Exchange Commission (the SEC), particularly our
annual reports on Form 10-KSB, our quarterly reports on Form 10-QSB and our
current reports on Form 8-K.

As used in this Quarterly Report, the terms "we", "us", "our",
Company and Encore mean Encore Clean Energy, Inc. unless otherwise
indicated. All dollar amounts in this Quarterly Report are in U.S. dollars
unless otherwise stated.

INTRODUCTION

The following discussion and analysis summarizes our plan of
operation for the next 12 months, our results of operations for the nine months
ended September 30, 2005 and changes in our financial condition from December
31, 2004. This discussion should be read in conjunction with the Managements
Discussion and Analysis or Plan of Operation included in our Annual Report on
Form 10-KSB for the year ended December 31, 2004.

Effective October 21, 2005, we completed a merger with a Nevada
corporation also named Encore Clean Energy, Inc. (Encore Nevada). As a result
of completing this merger, our jurisdiction of incorporation has been changed
from the State of Delaware to the State of Nevada. In addition, our authorized
capital was increased to include 100,000,000 shares of Common Stock and
20,000,000 shares of Preferred Stock. (See Part II, Item 4 Submission of
Matters to a Vote of Security Holders.)

We are currently engaged in the following businesses:

| | (i)  | The Encore Business: The Encore Business involves
      developing and commercializing proprietary clean-energy technologies
      that we have acquired through our acquisition of Cryotherm. Our plan for
      this segment of our business involves creating products that will be
      targeted at creating lower-cost, cleaner ways to generate electricity
      without the burning of fossil fuels.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                
| | (ii) | The Ignite Business: Prior to our acquisition of
      Cryotherm, our primary business was the Ignite Business of providing
      permission-based email marketing and integrated advertising services. We
      continue to carry on this segment of our business through our wholly owned
      subsidiary, Ignite Communications Inc. (Ignite).                                                         

PLAN OF OPERATION

Our plan of operation for the next twelve months includes the
following elements:

|1. | We will continue the research and development of our
      Encore products. Initially we plan to focus on the continuing development
      and commercialization of the HeatSeekerTMwaste heat recovery
      unit, the EliminatorTMRankine Cycle liquid pump elimination
      process, the SideWinderTMVAWT, the
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4

---

RiverBankTM hydro turbine
and our latest design, the MPGTMaccelerated magnetic piston
generator. In pursuit of this, we will:

|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                 | Pursue the development and testing of our
      HeatSeekerTM, EliminatorTM, SideWinderTM, RiverBankTMand MPGTMprototypes on various
      applications. We anticipate that the development and testing programs for
      these products will continue for the foreseeable future. The results of
      these testing programs will be used to further refine the product designs
      and identify the optimal sizes and configurations for various commercial
      and consumer applications. Our current development programs
  include:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                 | Refine our marketing and sales program for each of the
      products. The anticipated costs of manufacturing each product will be
      analyzed using the final designs and specifications for each. These costs
      will be used to develop a business model for various applications. The
      business models will be analyzed in order to identify the optimum target
      market for each of the products. We anticipate that the optimum market
      will depend on various factors, including the energy source, the
      electricity that can be generated based on the available energy source,
      the manufacturing costs and installation costs and the price of
      electricity in the targeted customers market. If we are able to develop
      fully functional prototypes of any of our Encore Products, of which there
      is no assurance, we intend to invite industry representatives to Robert
      Hunts facility located in Pass Christian, Mississippi in order
      demonstrate the potential benefits of those technologies. Mr. Hunt is the
      inventor of the clean-energy technologies that we are currently
      developing. Mr. Hunt is also one of our principal stockholders and acts as
      one of our consultants.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|2. | We also plan to continue operating our advertising
      business through our wholly owned subsidiary, Ignite Communications, Inc.
      We will continue to seek new clients for our integrated advertising
      strategies and permission-based eDirect Marketing services and to
      further explore how we can better service our existing clients. In pursuit
      of this, we plan to do the following:
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                 | Build market awareness and recognition for Ignite eDirect
      Marketing;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                 | Target industries and businesses that represent the
      greatest potential for both email marketing adoption and traditional
      advertising growth;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (c)                                                                                                                                                                                                                                                                                                                                                                                                                 | Develop and present case studies to organizations in
      other regions and markets who could benefit from our experience;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (d)                                                                                                                                                                                                                                                                                                                                                                                                                 | Research and utilize emerging relevant technologies
      primarily from application service providers (ASPs);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (e)                                                                                                                                                                                                                                                                                                                                                                                                                 | Leverage our advertising contacts in pursuit of Ignite
      eDirect Marketing opportunities;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (f)                                                                                                                                                                                                                                                                                                                                                                                                                 | Pursue strategic acquisitions and alliances to access new
      geographic markets and to add complimentary
services.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

5

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We anticipate spending approximately $2,500,000 in pursuing our
plan of operation over the next twelve months. This amount is in excess of our
current cash reserves. It is anticipated that the Encore Business will not
generate any significant revenues over the next twelve months and we do not
anticipate earning sufficient income from the Ignite Business to fund our
development plan for the Encore Business. Accordingly, we will require
substantial additional financing in order to fund our plan of operation. We
anticipate that any additional financing will likely be in the form of equity
financing as substantial debt financing will not be as available at this stage
of our business.

Currently, we do not have any firm financing arrangements in
place and there is no assurance that we will be able to achieve sufficient
financing required to proceed with the development of our Encore Products. If we
do not obtain the necessary financing, then our plan of operation will be scaled
back according to the amount of funds available. The inability to raise the
necessary financing will severely restrict our ability to complete the
development and commercialization of our Encore Products. In the event that we
are unable to develop and commercialize our Encore Products, we intend to focus
on the Ignite Business.

RESULTS OF OPERATIONS

Third Quarter and Nine Months Summary

Third Quarter Ended September 30
    
    
    Nine Months Ended September 30Percentage
    
    
      
    
    
      
    
    
      Percentage2005
    
    
      2004
    
    
      Inc.
        / (Dec.)
    
    
      2005
    
    
      2004
    
    
      Inc.
        / (Dec.)Revenue
    $
      646,999
    
    $
      561,613
    
    
      15.2%
    
    $
      2,047,359
    
    $
      2,006,849
    
    
      2.0%Cost of Revenue
    
      (558,933
    )
    
      (370,976
    )
    
      50.7%
    
    
      (1,589,971
    )
    
      (1,392,572
    )
    
      14.2%Operating Expenses
    
      (485,953
    )
    
      (365,193
    )
    
      33.1%
    
    
      (1,490,875
    )
    
      (1,211,869
    )
    
      23.0%Interest Expenses
    
      (91,109
    )
    
      (77,116
    )
    
      18.2%
    
    
      (365,321
    )
    
      (224,106
    )
    
      63.0%Net Loss
    $
      (488,996
    )
    $
      (251,672
    )
    
      94.3%
    
    $
      (1,398,808
    )
    $
      (821,698
    )
    
      70.2%


Revenue

For the last fiscal quarter, revenues were generated solely
from the Ignite Business. We did not earn revenues from our Encore Business and
there is no assurance that we will be able to do so in the future.

We experienced an increase in our revenues during the third
fiscal quarter of 2005 as compared to the same period in 2004. This increase is
due to the addition of two new clients.

Revenues for the Ignite Business are earned by delivering
online direct marketing, promotional, and informational offers and by developing
and implementing integrated marketing and advertising strategies. We charge our
advertisers based upon a number of criteria including offers delivered,
qualified leads generated, online transactions executed and marketing services
performed.

Revenue for the Ignite Business consists of the gross value of
our billings to clients and includes the price of the advertising that we
purchase from offline and online suppliers. Under marketing services contracts,
we recognize the cost of the advertising we purchase for our clients as an
expense and the payments we receive from our clients for this advertising as
revenue. Under these arrangements, we are ultimately responsible for payment to
suppliers for the cost of the advertising that we purchase.

We believe that our revenues will be subject to seasonal
fluctuations as a result of general patterns of retail advertising, which are
typically higher during the third and fourth calendar quarters. In addition,
expenditures by advertisers tend to be cyclical, reflecting overall economic
conditions and consumer buying patterns.

6

---

Cost of Revenue

Cost of revenue for the Ignite Business represents the cost of
advertising purchased for clients. The increase in our cost of revenue as
compared to the third fiscal quarter of 2004 is a direct result of our increased
revenue.

Operating Expenses

Third Quarter Ended September 30
    
    
    Nine Months Ended September 30Percentage
    
    
      
    
    
      
    
    
      Percentage2005
    
    
      2004
    
    
      Inc.
        / (Dec.)
    
    
      2005
    
    
      2004
    
    
      Inc.
        / (Dec.)Depreciation
    $
      6,166
    
    $
      7,194
    
    
      (14.2)%
    
    $
      14,982
    
    $
      22,608
    
    
      (33.7)%Salaries and Fringe
    
      165,269
    
    
      170,767
    
    
      (3.2)%
    
    
      475,790
    
    
      520,754
    
    
      (8.6)%BenefitsLegal and Accounting
    
      78,126
    
    
      22,407
    
    
      248.7%
    
    
      149,679
    
    
      112,021
    
    
      33.6%Consulting Fees and
    
      161,746
    
    
      106,070
    
    
      52.5%
    
    
      539,195
    
    
      380,929
    
    
      41.5%Computer ServicesPhones and Utilities
    
      4,979
    
    
      5,806
    
    
      (14.2)%
    
    
      16,414
    
    
      17,661
    
    
      (7.1)%Rent
    
      29,866
    
    
      26,659
    
    
      12.0%
    
    
      87,436
    
    
      92,558
    
    
      (5.5)%Advertising and
    
      5,014
    
    
      3,114
    
    
      61.0%
    
    
      106,648
    
    
      9,848
    
    
      982.9%PromotionOther selling, general
    
      34,787
    
    
      23,176
    
    
      50.1%
    
    
      100,731
    
    
      55,490
    
    
      81.5%and administrativeTotal Operating
    $
      485,953
    
    $
      365,193
    
    
      33.1%
    
    $
      1,490,875
    
    $
      1,211,869
    
    
      23.0%Expenses


Our total operating expenses incurred during the quarter ended
September 30, 2005, increased by $32,694 or 33.1% over our operating expenses
incurred during the same period ended September 30, 2004. This increase in our
operating expenses was primarily attributable to significant increases to our
legal and accounting fees, consulting fees and computer services, advertising
and promotion expenses and other selling, general and administrative
expenses.

The increase in consulting fees and computer services for the
quarter ended September 30, 2005, compared to the three and nine month periods
ended September 30, 2004, is primarily the result of additional consulting costs
associated with the development of our clean energy technologies for the Encore
Business.

During the quarter ended June 30, 2005, we commenced a
marketing and advertising campaign in order to promote public awareness of
developments in our clean energy technologies for the Encore Business. As a
result, we experienced a significant increase in the advertising and promotion
expenses that we incurred during the period ended September 30, 2005 as compared
to the same period ended in 2004.

The increase in selling, general and administrative costs
during the quarter ended September 30, 2005 compared to the same period in 2004
is a direct result of our increased spending to support the Encore Business.

We also experienced a decrease in amounts incurred as a result
of salaries and fringe benefits during the quarter ended September 30, 2005.
This decrease is largely a result of the amalgamation of Forge Marketing Inc.s
operations into Ignite Communications and the subsequent decrease in staffing
levels.

7

---

Interest Expenses

The increase in interest expense during the quarter ended
September 30, 2005, as compared to the same period in 2004, is primarily
attributable to interest and financing charges related to advances from related
parties and loans repaid during the period.

LIQUIDITY AND CAPITAL RESOURCES

|Working Capital         |   |                             |   |   |                            |   |  |                       | 
|----------------------- | - | --------------------------- | - | - | -------------------------- | - |  | --------------------- | 
|                        |   |                             |   |   |                            |   |  | Percentage            | 
|                        |   | At September
      30, 2005 |   |   | At December
      31, 2004 |   |  | Increase / (Decrease) | 
|Current Assets          | $ | 176,415                     |   | $ | 144,651                    |   |  | 22.0%                 | 
|Current Liabilities     |   | (3,828,385                  | ) |   | (3,182,031                 | ) |  | 20.3%                 | 
|Working Capital Deficit | $ | (3,651,970                  | ) | $ | (3,037,380                 | ) |  | 20.2%                 | 

|Cash Flows                                    |   |                                |   |   |          |  
|--------------------------------------------- | - | ------------------------------ | - | - | -------- | -
|                                              |   | Nine Months Ended September 30 |  
|                                              |   | 2005                           |   |   | 2004     |  
|Net Cash from (used in) Operating Activities  | $ | (910,692                       | ) | $ | (522,611 | )
|Net Cash from (used in) Investing Activities  |   | (6,222                         | ) |   | (6,631   | )
|Net Cash from (used in) Financing Activities  |   | 693,861                        |   |   | 537,848  |  
|                                              |   | 223,218                        |   |   | (9,134   | )
|Net Increase (decrease) in Cash During Period | $ | 165                            |   | $ | (528     | )

The increase in our current assets is primarily attributable to
an increase in prepaid expenses, which increased by $15,886 or 123.0% from
December 31, 2004. In addition, we have recorded investments in the amount of
$14,966 on account of shares of a publicly traded company that we received in
settlement of an accounts receivable debt. The increase in our current
liabilities is primarily attributable to increases in our accounts payable,
which increased by $140,111 or 7.3% from December 31, 2004, and to increases in
the current portion of amounts due to related parties, which increased by
$424,271 or 49.3% from December 31, 2004.

Cash provided by financing activities for the nine months ended
September 30, 2005 consisted primarily of the following:

| | (a) | We recorded as cash received from the issuance of LLC
      subsidiary units, $100,000 in capital contributions made by the Abell
      Foundation, Inc. to our joint venture enterprise, World, Wind and Water
      Energy LLC.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                  
| | (b) | During the nine months ended September, 30, 2005, we
      received financing from related parties in the amount of $378,031. There
      are no fixed terms of repayment attached to the amounts
advanced.                      
| |     |                                                                                                                                                                                                                                  
| | (c) | We received financing from proceeds from bank indebtedness
        in the amount of $71,054.                                                                                                                                     
| |     |                                                                                                                                                                                                                                  
| | (d) | In August, 2005, we issued 300,000 shares of our Series A
      Convertible Preferred Stock at a price of $0.50 per share to a number of
      accredited investors for total proceeds of
$150,000.                              

We anticipate that we will require financing in the amount of
$2,500,000 in order to fund our plan of operation over the next twelve months.
In addition to financing our development plans for the Encore Products, we
anticipate that we will continue to require additional financing to fund the
Ignite Business which continues to consume more cash in operating activities
than is generated. We plan to pursue additional

8

---

bank debt and equity financings through private placements of our common stock or common stock and share purchase warrants in order to raise the funds necessary to enable us to pursue our plan of operation for the next twelve months. We do not have
any arrangements in place for equity financing and there is no assurance that any equity financing will be achieved. If equity financing is achieved, then it is anticipated that existing shareholders will suffer dilution. In addition to third party
debt financing and equity financings, we have sustained our operations to date with advances from related parties, however we do not have any formal financing arrangements in place with any of these related parties and there is no assurance that
they will continue to provide us with funds.

Our ability to meet our current obligations is dependent upon continued advances from related parties, upon our ability to increase our revenues while maintaining expenses and upon our ability to achieve additional financing. If we are unable to
meet our current obligations, we may be forced to significantly scale back our business operations with the result that our ability to earn revenues and achieve profitability may be adversely affected.

OFF-BALANCE SHEET ARRANGEMENTS

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital
expenditures or capital resources that is material to stockholders.

RISKS AND UNCERTAINTIES

Risks and Uncertainties Related to the Encore Business

The Encore Business Will Incur Losses And May Never Achieve Profitability

We do not expect the Encore Business to achieve profitability in the near future and we expect to incur substantial operating losses for at least the next eighteen months. If we are unable to develop a significant revenue stream or if expenses are
larger than expected, the Encore Business may never become profitable. We anticipate substantial expenditures in a number of areas, including:

- development and commercialization of prototypes;
- public demonstration of prototypes;
- marketing and promotion of our Encore products, including building recognition of the Encore name;
- establishing an operating infrastructure, including management and administrative personnel.

In addition, as a result of the lack of an operating history, the emerging nature of the clean energy market and the unproven nature of our clean energy business model, we are unable to accurately forecast revenue for the Encore Business. We will
incur operating expenses based predominantly on operating plans and estimates of future revenue. We may be unable to adjust spending in a timely manner to compensate for any unexpected revenue shortfalls.

Accordingly, a failure to meet revenue projections would have an immediate and negative impact on our ability to achieve profitability.

Liquidity and Future Operations

Our plan of operation calls for significant expenses in connection with the development of our Encore Products. Our current operating funds and revenues are insignificant compared to the funding required to complete our plan of operation which will
require an estimated $2,500,000 to be spent over the next 12 months developing and marketing prototypes of our Encore products in order to accomplish our goals. As of September 30, 2005, we had cash in the amount of $165 and a working
capital deficit of $3,651,970. Our ability to meet our obligations in the ordinary course of our operations is dependent on our ability to

9

---

establish profitable operations and positive cash flows from operating activities or to obtain additional funding through public or private equity financing, debt collaborative or other arrangements.

We will also require additional financing if the costs of developing our Encore products are greater than anticipated.  There is no assurance that actual cash requirements will not exceed our estimates. In particular, additional capital may be
required in the event that:

- we incur unexpected costs in completing the development of a prototype of one of our products or encounter any unexpected technical or other difficulties;
- we incur delays and additional expenses as a result of technology failure;
- we are unable to create a substantial market for our products; or
- we incur any significant unanticipated expenses.

We are working to obtain sufficient working capital from external sources in order to continue operations and meet our plan of operation. There is however, no assurance that the aforementioned events, including the receipt of additional funding,
will occur or be successful. Failure to generate sufficient cash flow will require us to amend or reduce our operations and could adversely affect our ability to meet our plan of operation.

Risks Related To The Protection Of Intellectual Property Rights

Ownership of patent applications of the Cryotherm technologies invented by Robert Hunt resides with Mr. Hunt, who has provide us with an exclusive worldwide license to make, use and sell products based on such patent applications in consideration of
license fees and royalties. We are relying on the patent applications of Mr. Hunt to protect our core technologies and products from competition.

We cannot assure investors that pending or future patent applications will result in the granting of patents or that any issued patents will not be invalidated, circumvented or challenged. A portion of our proprietary technology depends upon
unpatented trade secrets and know-how. Without patent protection we would be vulnerable to competition from third parties who could develop competing products through reverse engineering. Also, where we do not have patent protection, competitors may
independently develop substantially equivalent technology or otherwise gain access to our trade secrets, know-how or other proprietary information.

Our Product Development Program May Not Be Successful

Once we complete development of our prototypes there is no assurance that our prototypes will work as expected. In the event we successfully develop a prototype, there is no assurance that we will be able to manufacture the prototype at a reasonable
cost.  Even if we are able to manufacture the prototype at a reasonable cost, there is no assurance that the price of our Encore Products will not be excessive, precluding the product from generating sufficient market acceptance. As such, there is
no assurance that we will be able to successfully develop and commercialize the Encore Products.

A Market For The Encore Products And Services May Not Develop Or We May Be Unable To Achieve Market Acceptance

Our technologies and products represent an emerging market, and we are unable to provide assurances that our targeted customers and markets will accept our technologies or will purchase our products and services in sufficient quantities to achieve
profitability. If a significant market fails to develop or develops more slowly than we anticipate, we may be unable to recover the losses incurred to develop products, we may be unable to meet our operational expenses and we may be unable to
achieve profitability. The development of a suitable market for our technologies and products may be impacted by many factors which are out of our control, including:

- the cost competitiveness of our products and services;
- the cost and availability of alternative products and services;
- customer reluctance to try new products or services;

10

---

- regulatory requirements; and
- the emergence of newer, more competitive technologies and products.

The Encore Business Is Dependent On Key Personnel and Sub-Contractors

The success of the Encore Business depends on the abilities and continued participation of key personnel such as inventor Robert Hunt, who has been instrumental in bringing several of our technologies to their present state of development. The loss
of Mr. Hunts services could hamper the successful development of our new technologies and products. We do not have "key man" life insurance on Mr. Hunt and have no plans to obtain such insurance. Our success also depends on our ability to
attract and retain additional skilled employees, vendors and sub-contractors, who can bring our patents-pending designs to market.

We intend to rely in the near term upon sub-contractors and suppliers for a significant portion of our current and proposed products. The inability of sub-contractors and suppliers to meet their obligations may affect our ability to develop and
deliver products on a timely and competitive basis.

Our success in the next few years is significantly dependent upon the abilities of our management. The determination of employee compensation is in control of the Board of Directors of the Company. The loss of the services of any one or more of our
key employees or contractees could adversely affect us to a substantial degree.

Limited Experience of Management

Although our management collectively has significant business experience, most of our current officers and directors have limited experience with the clean energy business in particular. There is no assurance that we have or will acquire the skills
necessary to enable the Encore Business to be profitable

We Have A Limited Operating History In The Energy Business

We have only recently moved into the clean energy business and we have limited experience operating in this business. We will need to generate significant revenues to achieve profitability, which may not occur. Our limited operating history makes it
difficult to forecast future operating results.  We expect operating expenses to increase as a result of the further implementation of our business plan. Even if we achieve profitability, we may be unable to sustain or increase profitability on a
quarterly or annual basis in the future. It is possible that we will never achieve profitability.

Risks and Uncertainties Related to the Ignite Business

Our Existing Ignite Client Base Is Concentrated And The Loss Of A Major Client Would Be Difficult To Replace

Three advertising clients currently account for over 61% of our revenues. The loss of any of these clients would significantly damage our revenue base and opportunities for growth. We cannot guarantee that these clients will remain with us or that
we will be able to access new clients to replace them.

Competition For Internet Advertising And Direct Marketing Is Intense And Could Adversely Affect Our Business.

The market for internet advertising and direct marketing is intensely competitive, rapidly changing and highly fragmented. With no significant barriers to entry and increasing attention being placed on the internet as a means of advertising and
direct marketing, we expect that competition will continue to increase in the near term. Our ability to compete and generate revenue from businesses will depend on our skill in utilizing our expertise in electronic direct marketing technology to
provide superior strategies and execution.

As we expand the scope of our advertising product and service offerings, we may compete with a greater number of media companies across a wide range of advertising and direct marketing services. Many of these companies have greater name recognition,
longer operating histories, larger customer bases and significantly greater financial, technical, marketing, public relations, sales, distribution and other resources

11

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than we do. In addition, current and potential competitors have established or may establish cooperative relationships among themselves or with third parties to increase the ability of their products or services to address the needs of our
prospective advertisers and advertising agency customers. As a result, we may not be able to compete effectively and competitive pressures may result in price reductions, reduced gross margins and an inability to gain market share.

Failure To Safeguard Member Privacy Could Affect The Ignite Reputations Among Consumers.

An important feature of the Ignite advertising and marketing strategies is our ability to capture list member profiles on behalf of our clients. Security and privacy concerns may cause consumers to resist providing the personal data necessary to
support this profiling capability. Usage of our marketing program could decline if any well-publicized compromise of security occurred. As a result of these security and privacy concerns, we may incur significant costs to protect against the threat
of security breaches or to alleviate problems caused by such breaches.

For Ignite To Remain Competitive, We Must Keep Pace With Technological Changes In Our Industry

The internet and our market are characterized by rapidly changing technologies, frequent new product and service introductions, short development cycles, evolving industry standards and intense competition. We must adapt to rapidly changing
technologies by maintaining and improving the performance features and reliability of our services. We may experience technical difficulties that could impact the operation of existing systems or delay the successful development, introduction or
marketing of new products and services.

Continued Development And Use Of The Internet Infrastructure Is Critical To Ignites Ability To Offer Our Services

We depend heavily on third-party providers of internet and related telecommunication services to operate our online direct marketing service. Internet service providers have experienced significant outages in the past, and could experience outages,
delays and other difficulties due to system failures unrelated to our systems. If outages or delays occur frequently in the future, internet usage and the usage of our products and services, could grow more slowly or decline. If internet usage
grows, the internet infrastructure may not be able to support the demands placed on it by this growth and its performance and reliability may decline.

Government Regulation And The Legal Uncertainties Of Doing Business On The Internet Could Negatively Impact The Ignite Business

Laws and regulations that apply to internet communications, commerce and advertising are becoming more prevalent. These regulations could affect the cost of communicating on the internet and negatively affect the demand for our direct marketing
solutions or otherwise harm our business. Laws and regulations may be adopted covering issues such as user privacy, pricing, libel, acceptable content, taxation and quality of products and services. This legislation could hinder growth in the use of
the Internet generally and decrease the acceptance of the Internet as a communications, commercial and direct marketing medium.

The laws governing the internet remain largely unsettled, even in areas where there has been some legislative action. It may take years to determine whether and how existing laws apply to the internet and internet advertising. In addition, the
growth and development of the market for Internet commerce may prompt calls for more stringent consumer protection laws, both in the United States and abroad. This may impose additional burdens on companies conducting business over the Internet.

The Ignite Business Is Dependent on Key Personnel

The success of our Ignite Business depends on the abilities and continued participation of key personnel. The loss of any of our key employees, consultants or sub-contractors could hamper the development and continued operation of our Forge/Ignite
Business and could have a substantial adverse affect on the Company as a whole.

12

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Ignite Has a Limited Operating History

We have a limited operating history upon which to evaluate our
business strategies and performance. Our limited operating history makes it
difficult to forecast future operating results. We cannot be certain that
revenues will increase at a rate sufficient to achieve and maintain
profitability. Even if we were to achieve profitability in any period, we might
fail to sustain or increase that profitability on a quarterly or annual basis.

|ITEM 3. | CONTROLS AND PROCEDURES.
|------- | ------------------------

Evaluation Of Disclosure Controls And Procedures

As of the end of the period covered by this report, our
management carried out an evaluation, under the supervision and with the
participation of our Chief Executive Officer and Chief Financial Officer, of the
effectiveness of the design and operation of our disclosure controls and
procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act).
Based on this evaluation, our Chief Executive Officer and Chief Financial
Officer has concluded that our disclosure controls and procedures are, as of the
date covered by this Quarterly Report, effective to ensure that the information
required to be disclosed by us in the reports that we file or submit under the
Exchange Act is recorded, processed, summarized and reported within the time
periods specified in the SEC rules and forms.

Changes In Internal Controls Over Financial
Reporting

In connection with the evaluation of our internal controls
during our last fiscal quarter, our Chief Executive Officer and Chief Financial
Officer has determined that there have been no changes to our internal controls
over financial reporting that has materially affected, or is reasonably likely
to materially effect, our internal controls over financial reporting.

13

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PART II - OTHER INFORMATION

|ITEM 1. | LEGAL PROCEEDINGS.
|------- | ------------------

None.

|ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND
      USE OF PROCEEDS.
|------- | ------------------------------------------------------------------

All unregistered sales of our equity securities made during the
period covered by this Quarterly Report have been previously disclosed in
reports filed by us with the SEC.

|ITEM 3. | DEFAULTS UPON SENIOR SECURITIES.
|------- | --------------------------------

None.

|ITEM 4. | SUBMISSION OF MATTERS TO VOTE OF SECURITY
      HOLDERS.
|------- | --------------------------------------------------------

On October 5, 2005, we held our Annual Meeting of the
Stockholders at our offices at Suite 610  375 Water Street, Vancouver, BC,
Canada. The following matters were voted upon at the meeting:

|1. | Election of Directors                                                                                                                                                                                                      
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                            
|   | The following individuals were elected to our board of
      directors, and will hold those positions until the next annual meeting of
      our stockholders or until their respective successors have been
      elected:

| |                     | For        |  | Against |  | Withheld / | 
| | ------------------- | ---------- |  | ------- |  | ---------- | 
| |                     |            |  |         |  | Abstained  | 
| |                     |            |  |         |  |            | 
| | Daniel B. Hunter    | 11,464,037 |  | 0       |  | 9,449      | 
| | Donald J. MacKenzie | 11,464,037 |  | 0       |  | 9,449      | 
| | Lawrence M. Shultz  | 11,464,037 |  | 0       |  | 9,449      | 

|2. | Merger with Encore Nevada                                                                                                                                                                                                            
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                      
|   | The merger with Encore Nevada, a Nevada corporation
      incorporated for the sole purpose of changing our jurisdiction of
      incorporation from the State of Delaware to the State of Nevada, was
      approved at the meeting.

| | For        |  | Against |  | Withheld / | 
| | ---------- |  | ------- |  | ---------- | 
| |            |  |         |  | Abstained  | 
| |            |  |         |  |            | 
| | 10,646,899 |  | 669,758 |  | 500        | 

The merger with Encore Nevada was
completed on October 21, 2005. As such, our legal domicile is now the State of
Nevada.

|3. | 2003 Stock Incentive Plan                                                       
|-- | --------------------------------------------------------------------------------
|   |                                                                                 
|   | The adoption of our 2003 Stock Incentive Plan was
      approved at the meeting.



| | For        |  | Against |  | Withheld / | 
| | ---------- |  | ------- |  | ---------- | 
| |            |  |         |  | Abstained  | 
| |            |  |         |  |            | 
| | 10,604,643 |  | 711,714 |  | 800        | 

---

|4. | Increase in Authorized Capital                                                                                                                               
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                              
|   | An increase in our authorized capital to 100,000,000
      shares of common stock and 20,000,000 shares of preferred stock was
      approved at the meeting.



| | For        |  | Against |  | Withheld | 
| | ---------- |  | ------- |  | -------- | 
| |            |  |         |  |          | 
| | 10,605,439 |  | 711,718 |  | 0        | 

The increase in our authorized capital was effected
on October 21, 2005 upon completion of the merger with Encore Nevada.

|ITEM 5. | OTHER INFORMATION.
|------- | ------------------

Except as may be described in this section, all information
required to be disclosed in a Current Report on Form 8-K during the period
covered by this Quarterly Report has been disclosed in reports previously filed
by us with the SEC.

Other Information

On October 5, 2005, at our Annual Meeting of the Stockholders,
our stockholders approved of our merger with Encore Nevada and an increase in
our authorized capital to 100,000,000 shares of Common Stock and 20,000,000
shares of preferred stock. Pursuant to our Articles of Incorporation, as
amended, each share of Series A Convertible Preferred Stock (Series A Stock)
outstanding is convertible into five (5) shares of our Common Stock and warrants
to purchase an additional five (5) shares of our Common Stock at a price of
$0.25 per share (the Series A Warrants). The conversion provisions of the
outstanding shares of Series A Stock were automatically deemed to have been
exercised upon our stockholders having approved the increase in our authorized
capital as described above. The Series A Warrants will expire at 5:00 PM
(Pacific Standard Time) on October 26, 2007.

On October 5, 2005 (the Conversion Date), we had 300,000
shares of Series A Stock outstanding. As such, effective on the Conversion Date,
we issued 1,500,000 shares of our Common Stock and Series A Warrants to acquire
an aggregate of 1,500,000 additional shares of Common Stock at a price of $0.25
per share. Certificates for the Series A Warrants and shares of Common Stock
issuable upon conversion are being issued to the former holders of our Series A
Stock upon the surrender for cancellation of share certificates representing
such Series A Stock.

|ITEM 6. | EXHIBITS AND REPORTS ON FORM 8-K.
|------- | ---------------------------------

|(a) | Exhibits and Index of Exhibits Required By Item 601 of
      Regulation S-B.
|--- | ----------------------------------------------------------------------------

|Exhibit
      Number | Description of Exhibit                                                                                                                                    
|-------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------
|                     |                                                                                                                                                           
|3.1                  | Articles
        of Merger, including Plan of Merger and Bylaws of Encore Clean Energy,
        Inc. (Nevada) attached as Exhibit B to the Plan of Merger.
|
|10.1                 | Exclusive License Agreement between Cryotherm,
      Inc. and Robert D. Hunt(1)                                                                           
|10.2                 | Letter Joint Projects,
        License and Consulting Agreement between Cryotherm, Inc. and Centripetal
        Dynamics, Inc.(1)                         
|

15

---

|Exhibit
      Number | Description of Exhibit                                                                                                                                                                       
|-------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                     |                                                                                                                                                                                              
|10.3                 | Letter Agreement between
        Encore Clean Energy, Inc. and Centripetal Dynamics, Inc. extending the
        terms of the Joint Projects, License and Consulting Agreement.(1)            
|
|10.4                 | Purchase Agreement
        and Plan of Reorganization dated July 28, 2003 between Forge, Inc., Cryotherm,
        Inc. and the major shareholders of Cryotherm, Inc. (2)                     
|
|10.5                 | Amendment to Purchase
        Agreement and Plan of Reorganization dated August 25, 2003 between Forge,
        Inc., Cryotherm, Inc. and the major shareholders of Cryotherm, Inc. (3)      
|
|10.6                 | Limited Liability Company
        Agreement of World, Wind and Water LLC, dated January 14, 2005, between
        Encore Clean Energy, Inc., Robert D. Hunt and The Abell Foundation, Inc.(4)
|
|
|10.7                 | First Amendment to
        the Limited Liability Company Agreement of World, Wind and Water Energy
        LLC dated January 14, 2005.(4)                                                    
|
|10.8                 | Technology Contribution
        Agreement, dated January 14, 2005, between Encore Clean Energy, Inc.,
        Robert D. Hunt and World, Wind and Water Energy LLC.(4)                        
|
|10.9                 | Convertible Note Agreement
        dated January 14, 2005 between Encore Clean Energy, Inc. and Robert Hunt.(5)                                                                              
|
|10.10                | Web Coverage and Advertising
        Services Agreement dated effective as of April 18th, 2005
        between Encore Clean Energy, Inc. and Free-Market News Network, Corp.(6)              
|
|10.11                | Consulting Agreement
        dated September 1, 2005 between Encore Clean Energy, Inc. and McCreath
        Communications.(6)                                                               
|
|10.12                | Consulting Agreement
        dated September 1, 2005 between Encore Clean Energy, Inc. and tinePublic
        Inc.(6)                                                                        
|
|10.13                | Letter Agreement dated
        July 5, 2005 between Encore Clean Energy, Inc. and Robert D. Hunt.(6)                                                                                         
|
|10.14                | Convertible Note Agreement
        dated July 5, 2005 between Encore Clean Energy, Inc. and Robert D. Hunt.(6)                                                                               
|
|10.15                | Consulting Agreement
        dated July 15, 2005 between Encore Clean Energy, Inc. and C&H Capital,
        Inc.(6)                                                                          
|
|10.16                | Letter Agreement dated
        August 5, 2005 between Encore Clean Energy, Inc. and ThermoSource, Inc.(6)                                                                                    
|
|10.17                | Development and License
        Agreement dated effective September 6, 2005 between Encore Clean Energy,
        Inc. and ISE Corporation.(7)                                                
|
|14.1                 | Code of Ethics.(1)                                                                                                                                                                           
|21.1                 | List of Subsidiaries.(1)                                                                                                                                                                     
|31.1                 | Certification
        of Chief Executive Officer and Chief Financial Officer as adopted pursuant
        to Section 302 of the Sarbanes-Oxley Act of 2002.                                   
|
|32.1                 | Certification
        of Chief Executive Officer and Chief Financial Officer as adopted pursuant
        to Section 906 of the Sarbanes-Oxley Act of 2002.                                   
|

|(1) | Previously filed as exhibits to our Annual Report on
        Form 10-KSB, filed with the SEC on May 17, 2004.       
|--- | --------------------------------------------------------------------------------------------------------------------
|(2) | Previously filed as an exhibit to our Current Report
        on Form 8-K filed with the SEC on August 1, 2003.      
|(3) | Previously filed as an exhibit to our Current Report
        on Form 8-K filed with the SEC on October 15, 2003.    
|(4) | Previously filed as an exhibit to our Current Report
        on Form 8-K filed with the SEC on January 19, 2005.    
|(5) | Previously filed as an exhibit to our Current Report
        on Form 8-K filed with the SEC on January 18, 2005.    
|(6) | Previously filed as an exhibit to our Quarterly Report on Form 10-QSB
      filed with the SEC on September 7, 2005.
|(7) | Previously filed as an exhibit to our Current Report on Form 8-K filed
      with the SEC on September 15, 2005.    

16



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|(b) | Current Reports On Form
8-K.
|--- | ----------------------------

We have filed the following reports on Form 8-K since the end
of our fiscal quarter ended June 30, 2005:

|Date of Form 8-K  | Date of Filing with the
      SEC | Description of the Form 8-K                                                                                                                                        
|----------------- | --------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                  |                                   |                                                                                                                                                                    
|August 5, 2005    | August 8, 2005                    | Disclosing dismissal of KPMG LLP as principal independent
      accountant and appointment of Dohan and Company, PA as principal
      independent accountant      
|
|
|                  |                                   |                                                                                                                                                                    
|August 29, 2005   | September 6, 2005                 | Disclosing the entry into an agreement with Larry Shultz
      dated August 29, 2005.                                                                              
|
|                  |                                   |                                                                                                                                                                    
|September 9, 2005 | September 15, 2005                | Disclosing the entry into an agreement dated effective
      September 6, 2005 with ISE Corporation.                                                               
|
|                  |                                   |                                                                                                                                                                    
|October 24, 2005  | October 25, 2005                  | Disclosing the completion of the merger between Encore
      Clean Energy, Inc., a Delaware corporation, and Encore Clean Energy, Inc.,
      a Nevada corporation.
|
|

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the
  Registrant caused this report to be signed on its behalf by the undersigned,
  thereunto duly authorized.

|                         | ENCORE CLEAN ENERGY, INC.
|------------------------ | -------------------------
|                         |                          
|Date:  December 15, 2005 | By:                      
|                         |                          
|                         | Title:                   
|                         |                          
|                         |                          

17

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