UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 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 November 30, 2006

OR

[  ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from __________ to ______________

Commission File Number 000-51716

CLEAN POWER TECHNOLOGIES INC.

(Exact name of registrant as specified in its charter)

|Nevada                                                       |  | 98-0413062                          
|------------------------------------------------------------ |  | ------------------------------------
|State or other jurisdiction of incorporation or organization |  | (I.R.S. Employer Identification No.)

436-35th Avenue N.W., Calgary, Alberta Canada T2K 0C1

(Address of principal executive offices)

(403) 277-2944

(Issuers telephone number)

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 X   No

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes    No X

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.

Yes    No



APPLICABLE ONLY TO CORPORATE ISSUERS

45,445,377 common shares outstanding as of January 18, 2007



Transitional Small Business Disclosure Format:   Yes    No X







PART I - FINANCIAL INFORMATION



ITEM 1.   FINANCIAL STATEMENTS



2





CLEAN POWER TECHNOLOGIES INC.

(A Development Stage Company)

INTERIM CONSOLIDATED FINANCIAL STATEMENTS

November 30, 2006

(Unaudited)

(Stated in US Dollars)



F-1





CLEAN POWER TECHNOLOGIES INC.

(A Development Stage Company)

INTERIM CONSOLIDATED BALANCE SHEETS

November 30, 2006

(Unaudited)

(Stated in U.S. Dollars)





|ASSETS                                           | November 30,                              | August 31,
|------------------------------------------------ | ----------------------------------------- | ----------
|                                                 | 2006                                      | 2006      
|                                                 |                                           |           
|Current                                          |                                           |           
|Cash                                             | $
67,904                                  | $
99,234  
|Amounts receivable                               | 90,184                                    | 56,125    
|Prepaid expenses  Note 3                        | 70,686                                    | 79,199    
|                                                 |                                           |           
|                                                 | 228,774                                   | 234,558   
|                                                 |                                           |           
|Plant and equipment                              | 266,481                                   | 159,981   
|                                                 |                                           |           
|                                                 | $
495,255                                 | $
394,539 
|                                                 |                                           |           
|LIABILITIES                                     
|                                                 |                                           |           
|Current                                          |                                           |           
|Accounts payable and accrued liabilities         | $
77,193                                  | $
92,500  
|Due to related party                             | 892,007                                   | 516,686   
|                                                 |                                           |           
|                                                 | 969,200                                   | 609,186   
|                                                 |                                           |           
|STOCKHOLDERS DEFICIENCY                        
|                                                 |                                           |           
|Capital Stock                                    |                                           |           
|Authorized:                                      |                                           |           
|75,000,000                                       | common shares, par value $0.001 per share |           
|Issued and outstanding:                          |                                           |           
|45,445,377                                       | common shares                             | 45,446    
|Additional paid-in capital                       | 77,201                                    | 63,746    
|Accumulated other comprehensive loss             | (22,051)                                  | (12,404)  
|Deficit accumulated during the development stage | (574,541)                                 | (311,435) 
|                                                 |                                           |           
|                                                 | (473,945)                                 | (214,647) 
|                                                 |                                           |           
|                                                 | $
495,255                                 | $
394,539 
|                                                 |                                           |           



SEE ACCOMPANYING NOTES



F-2



CLEAN POWER TECHNOLOGIES INC.

(A Development Stage Company)

INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS

for the three months ended November 30, 2006 and

for the period May 12, 2006 (Date of Inception) to November 30, 2006

(Unaudited)

(Stated in U.S. Dollars)





|                                              |              | May 12, 2006 
|--------------------------------------------- | ------------ | -------------
|                                              | Three months | (Date of     
|                                              | ended        | Inception) to
|                                              | November 30, | November 30, 
|                                              | 2006         | 2006         
|                                              |              |              
|Expenses                                      |              |              
|Depreciation                                  | $
16,589     | $
25,827     
|Interest  Note 3                             | 13,455       | 19,254       
|Office and administration                     | 73,206       | 117,733      
|Organizational costs                          | -            | 2,500        
|Professional fees                             | 25,097       | 82,087       
|Research and development                      | 50,305       | 115,710      
|Salaries and consulting fees                  | 84,454       | 179,097      
|Stock-based compensation                      | -            | 32,333       
|                                              |              |              
|Net loss for the period                       | (263,106)    | (574,541)    
|                                              |              |              
|Other comprehensive loss:                     |              |              
|Foreign currency translation adjustment       | (9,647)      | (22,051)     
|                                              |              |              
|Comprehensive loss for the period             | $
(272,753)  | $
(596,592)  
|                                              |              |              
|Basic and diluted loss per share              | $
(0.01)     |              
|                                              |              |              
|Weighted average number of shares outstanding | 45,445,377   |              
|                                              |              |              



SEE ACCOMPANYING NOTES

F-3



CLEAN POWER TECHNOLOGIES INC.

(A Development Stage Company)

INTERIM CONSOLIDATED STATEMENTS OF STOCKHOLDERS DEFICIENCY

for the three months ended November 30, 2006 and

the period May 12, 2006 (Date of Inception) to November 30, 2006

(Unaudited)

(Stated in U.S. Dollars)



|                                                                                 |              |          |               |             | Deficit     |            
|-------------------------------------------------------------------------------- | ------------ | -------- | ------------- | ----------- | ----------- | -----------
|                                                                                 |              |          |               | Accumulated | Accumulated |            
|                                                                                 |              |          | Additional    | Other       | During the  |            
|                                                                                 | Common Stock | Paid-in  | Comprehensive | Development |            
|                                                                                 | Shares       | Amount   | Capital       | Loss        | Stage       | Total      
|                                                                                 |              |          |               |             |             |            
|Balance, May 12, 2006                                                            | -            | $
-      | $
-           | $
-         | $
-         | $
-        
|Capital stock issued:                                                            |              |          |               |             |             |            
|For cash
- at $0.001                                                             | 28,765,477   | 28,766   | -             | -           | -           | 28,766     
|Pursuant to a technology acquisition agreement
- at $0.001                       | 2,000,000    | 2,000    | -             | -           | -           | 2,000      
|Clean Energy and Power Solutions Inc. common shares prior to reverse acquisition | (30,765,477) | (30,766) | 30,766        | -           | -           | -          
|Clean Power Technologies Inc. common shares prior to reverse acquisition         | 14,680,000   | 14,680   | (14,680)      | -           | -           | -          
|Common shares issued pursuant to share exchange agreements                       | 30,765,377   | 30,766   | 9,579         | -           | -           | 40,345     
|Imputed interest                                                                 | -            | -        | 5,748         | -           | -           | 5,748      
|Stock-based compensation                                                         | -            | -        | 32,333        | -           | -           | 32,333     
|Foreign currency translation adjustment                                          | -            | -        | -             | (12,404)    | -           | (12,404)   
|Net loss for the period                                                          | -            | -        | -             | -           | (311,435)   | (311,435)  
|                                                                                 |              |          |               |             |             |            
|Balance, August 31, 2006                                                         | 45,445,377   | 45,446   | 63,746        | (12,404)    | (311,435)   | (214,647)  
|                                                                                 |              |          |               |             |             |            
|Imputed interest                                                                 | -            | -        | 13,455        | -           | -           | 13,455     
|Foreign currency translation adjustment                                          | -            | -        | -             | (9,647)     | -           | (9,647)    
|Net loss for the period                                                          | -            | -        | -             | -           | (263,106)   | (263,106)  
|                                                                                 |              |          |               |             |             |            
|Balance November 30, 2006                                                        | 45,445,377   | $
45,446 | $
77,201      | $
(22,051)  | $
(574,541) | $
(473,945)

SEE ACCOMPANYING NOTES

F-4



CLEAN POWER TECHNOLOGIES INC.

(A Development Stage Company)

INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

for the three months ended November 30, 2006 and

for the period May 12, 2006 (Date of Inception) to August 31, 2006

(Unaudited)

(Stated in U.S. Dollars)





|                                                                   |              | May 12, 2006 
|------------------------------------------------------------------ | ------------ | -------------
|                                                                   | Three months | (Date of     
|                                                                   | ended        | Inception) to
|                                                                   | November 30, | November 30, 
|                                                                   | 2006         | 2006         
|                                                                   |              |              
|Cash Flows From Operating Activities                               |              |              
|Net loss for the period                                            | $
(263,106)  | $
(574,541)  
|Items not affecting cash:                                          |              |              
|Depreciation                                                       | 16,589       | 25,827       
|Imputed interest                                                   | 13,455       | 19,203       
|Research and development                                           | -            | 2,000        
|Stock-based compensation                                           | -            | 32,333       
|Changes in non-cash working capital balance related to operations: |              |              
|Amounts receivable                                                 | (31,586)     | (84,218)     
|Prepaid expenses                                                   | 10,142       | (64,761)     
|Accounts payable and accrued liabilities                           | (15,797)     | 64,878       
|                                                                   |              |              
|Cash flows used in operating activities                            | (270,303)    | (579,279)    
|                                                                   |              |              
|Cash Flows from Investing Activities                               |              |              
|Acquisition of plant and equipment                                 | (115,753)    | (276,013)    
|Cash acquired from business acquisition                            | -            | 62,070       
|                                                                   |              |              
|Cash flows used in investing activities                            | (115,753)    | (213,943)    
|                                                                   |              |              
|Cash Flows from Financing Activities                               |              |              
|Issuance of common shares                                          | -            | 28,766       
|Due to related party                                               | 353,607      | 829,659      
|                                                                   |              |              
|Cash flows provided by financing activities                        | 353,607      | 858,425      
|                                                                   |              |              
|Foreign currency translation adjustment                            | 1,119        | 2,701        
|                                                                   |              |              
|Increase (decrease) in cash during the period                      | (31,330)     | 67,904       
|                                                                   |              |              
|Cash at beginning of period                                        | 99,234       | -            
|                                                                   |              |              
|Cash at end of period                                              | $
67,904     | $
67,904     
|                                                                   |              |              

Non-Cash Transaction  Note 5

SEE ACCOMPANYING NOTES

F-5



CLEAN POWER TECHNOLOGIES INC.

(A Development Stage Company)

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

August 31, 2006

(Unaudited)

(Stated in U.S. Dollars)





Note 1

Interim Financial Statements



While the information presented in the accompanying three months to November 30, 2006 interim financial statements is unaudited, it includes all adjustments which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows for the interim period presented in accordance with the accounting principles generally accepted in the United States of America.  In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature.  It is suggested that these financial statements be read in conjunction with the Companys August 31, 2006 financial statements.



Operating results for the three months ended November 30, 2006 are not necessarily indicative of the results that can be expected for the year ending August 31, 2007.



Note 2

Continuance of Operations



These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for its next twelve months.  Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern.  At November 30, 2006, the Company had not yet achieved profitable operations, has accumulated losses of $574,541 since its inception, has a working capital deficiency of $740,426 and expects to incur further losses in the development of its business, all of which casts substantial doubt about the Companys ability to continue as a going concern.  The Companys ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due.  Management has no formal plan in place to address this concern but considers that the Company will be able to obtain additional funds by equity financing and/or related party advances, however there is no assurance of additional funding being available.







F-6



CLEAN POWER TECHNOLOGIES INC.

(A Development Stage Company)

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

August 31, 2006

(Unaudited)

(Stated in U.S. Dollars)





Note 3

Related Party Transactions



Included in prepaid expenses is $57,061 (August 31, 2006: $64,166) of prepaid rent paid to a director of Clean Power Technologies Ltd. (CPTL).  Rent expense of $8,507 was charged by the director for the period ended November 30, 2006.



Interest expense of $13,455 has been imputed at 8% in respect to advances due to a director of the Company.



Note 4

Commitments



i)

On July 26, 2006 CPTL entered into a three year lease agreement for an office and research facility located in Newhaven, United Kingdom.  The lease expires on July 25, 2009.  The CPTL lease calls for annual rent in the amount of $34,222 (£18,000) plus applicable taxes, and is payable quarterly.



CPTL is required to make minimum lease payments over the remaining term of the lease as follows:



|Lease Period              | Annual Payment
|------------------------- | --------------
|                          |               
|Year ending July 31, 2007 | $
34,222      
|Year ending July 31, 2008 | 34,222        
|Year ending July 31, 2009 | 34,222        
|                          |               
|Total                     | $
102,666     
|                          |               



ii)

On June 21, 2006, the Company entered into an investor relations agreement for a period of one year for consideration of $2,500 per month and has granted 200,000 share purchase options exercisable at $1.30 per share until July 1, 2008.  The options will vest in equal quarterly amounts over the next twelve months.



iii)

The Company entered into a collaboration agreement dated October 11, 2006 for the development of a steam accumulator and other related technologies in partnership for use with the Companys petrol (gas)/steam and diesel/steam hybrid technologies project.

F-7



CLEAN POWER TECHNOLOGIES INC.

(A Development Stage Company)

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

August 31, 2006

(Unaudited)

(Stated in U.S. Dollars)





Note 4

Commitments  (contd)



iii)  (contd)



The agreement calls for funding of approximately US$400,000 by the Partner.  As consideration, the Company will issue 4,000,000 common shares of the Company.  The agreement further provides that within 18 months from the first vehicle being publicly unveiled, the Partner will have the option of either seeking cash reimbursement of its development costs from the Company or retaining the previously issued shares of common stock of the Company.  Should the Partner seek cash reimbursement then the Partner shall return a total of 3,000,000 shares of common stock to the Company.  Should development costs exceed US$400,000 then the Partner will have the option to either receive cash reimbursement of the amount in excess of US$400,000 or to receive additional shares of the Company at a price to be negotiated.  Should the Company be unable to reimburse the Partner on any call for reimbursement as allowed under the collaboration agreement, the Company will transfer an equal share of the intellectual property to the Partner so that the Partner and the Company will own the intellectual property equally.



The Company will provide an additional 100,000 common shares to the Partner, which shall be used at their discretion to reward any of their employees who have helped in the development of the technologies project.



The term of the agreement is three years.



iv)

By resolution dated September 28, 2006, the Board of Directors approved a convertible debenture for amounts advanced by a director of the Company with the following terms:



-

bears interest at 8% per annum which shall be accrued and paid on maturity;



-

shall be convertible at $0.50 per share and may be convertible in total or in part;



-

shall be for a period of two years from date of execution; and



-

the Company may elect to repay the debenture at any time or upon the director advising of his election to convert to common shares.





F-8





CLEAN POWER TECHNOLOGIES INC.

(A Development Stage Company)

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

August 31, 2006

(Unaudited)

(Stated in U.S. Dollars)



Note 4

Commitments  (contd)



v)

By an agreement dated January 4, 2007, the Company executed an Investment Agreement and a Registration Rights Agreement with the Dutchess Private Equities Fund Ltd. (Dutchess).  Under the terms of these agreements, Dutchess will provide an equity line of credit of $10,000,000 to be taken down at the Companys election, either a) 200% of the average US daily volume of the common stock for the 10 trading days prior to the put notice date multiplied by the average of the three daily closing bid prices immediately proceeding the put date or b) $250,000 upon the registration of the initial amount of 10,000,000 common shares by the Company which will be used for the draw down of funds.  The registration statement is to provide for the offering of securities on a continuing basis and the Company must use its best efforts to have the registration statement effective within 120 days for the date of the agreements.  The agreement further calls for the Company to pay a 1% fee to a registered broker dealer to a maximum of $10,000 on each draw down of funds under the Investment Agreement.  The Company has retained legal counsel to prepare the registration statement for filing with the Securities and Exchange Commission.



Note 5

Non-cash Transaction



Investing and financing activities that do not have a direct impact on current cash flows are excluded from the statements of cash flows.  During the period May 12, 2006 (Date of Inception) to November 30, 2006, the Company issued 2,000,000 shares of common stock at $0.001 per share for a total value of $2,000 in respect to the acquisition of a technology from two directors of Clean Power Technologies Limited.  This transaction has been excluded from the statements of cash flows.



Note 6

Subsequent Event



Subsequent to November 30, 2006, a director of the Company advanced $39,400 to the Company.  This advance is unsecured, non-interest bearing and has no specific terms for repayment.





F-9



Item 2.   Managements Discussion and Analysis or Plan of Operation

Plan of Operation

This current report contains forward-looking statements as that term is defined in section 27A of the United States Securities Act of 1933 and section 21E of the United States Securities Exchange Act of 1934.  These statements relate to future events or our future financial performance.  In some cases, you can identify forward-looking statements by terminology such as "may", "should", "intends", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential", or "continue" or the negative of these terms or other comparable terminology.  These statements are only predictions and involve known and unknown risks, uncertainties and other factors which may cause our or our industry's actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity or performance.  Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

(a) Pla n of Operation



We have not generated any revenues from products, services or operations since the inception of our Company.   We are a development stage company which is presently undertaking research and development on a hybrid steam engine .



Our plan of operations is to complete the research and development on our technology over the next several months and if successful, to license the technology or form partnerships for the use of the technology with any customers we may identify.



At present we do not have sufficient funds available to execute our business plan for the development of the technology.   We have to date been funded by existing working capital and by shareholder loans from one of our directors and officers.  There can be no assurance that we will be able to continue to raise the funding required to continue operations.



Our principal activity to date has been the updating and development of the infrastructure of the industrial building of which the Company took possession in late July. Lighting of the whole working space has been totally reinstalled with dramatically improved consequences for the environment in the administrative offices, test area and workshop. For the latter, delivery has been taken of a range of modern machine tools to service the extensive experimental development programme to which the Company is committed in order to optimise the performance of the hybrid power trains that will be its principal product. Electrical supply and internal wiring have been completely renewed to support these facilities.



Having completed the clearance of ancillary equipment in the Wankel engine compartment of the first Mazda RX8 vehicle, delivery of which was taken in April 2006 at the founding of the Companys U.K. subsidiary, a second identical car was received in September 2006 to allow parallel development of the optimum geometrical arrangement of the components of the auxiliary power units of the Companys system of clean energy storage and recovery (CESAR). This important work has proceeded but in the background to the infrastructure developments described above.



3



Experimental research has always been seen as an inevitable and crucial successor to the earlier theoretical studies that have supported the evolution of the CESAR hybrid vehicle system. The experiments will provide the essential empirical data required to enable the precise specification of the sophisticated control requirements of the power plant in steady open road operation as well as the anti-pollution urban mode. They will involve conventional operation of the combustion engine and also in driven mode with compressed air to simulate performance of the vapour in the total hybrid system in advance of delivery of the prototype accumulator vessel which we have been advised will be received from Mitsui Babcock by mid March 2007. An air compressor and storage pressure vessel of adequate capacity has been installed for this purpose.



Fluid dynamic and thermodynamic measurements of the charging and discharging rates of the energy accumulator, the performance of the auxiliary engine and of the main combustion engine will be monitored to supply an essential numerical data base. To this end the provision of a test cell to house safely the necessary test programme within the unit has been a major item in the infrastructure programme that has been completed in the period under review. An internal structure strong enough to protect the main unit from a catastrophic component failure has been built and will allow the test programme to proceed immediately.



Supporting theoretical work has continued throughout the period under review, including the detailed design of the energy accumulator. This has indicated that for optimum control and maximum efficiency, an output shaft-driven valve system will be required independent of the engine cylinder porting.  Preliminary design of this feature has begun.



A joint meeting of the design team and that from Mitsui-Babcock working on the CESAR project was held at the end of November 2006. Agreement was reached on the immediate practical path ahead with the understanding of the crucial influence that delivery of the first prototype energy accumulator would have, now scheduled for March 2007. It was further agreed that the initial experimental programme should be restricted to a fundamental study of the thermo-fluid dynamics of the system, with the geometrical constraints of immediate application to a vehicle postponed to a second phase. Thus the first pressurisation of the accumulator, after hydraulic and other safety testing would be from a twin lobe Mazda Wankel engine, operating under load control with a toroidal water dynamometer. Testing of this engine to determine operational fluid flows and temperatures will begin in parallel to provide data for the second phase.



Agreement was reached between the parties on the provision of instruments and controls for the prototype system, with Babcock to supply all hardware, including safety valves and sensors for pressure and temperature measurement. We will supply the steam valves and provide the control and data logging aspects of the system, although with the provision by Babcock of a control algorithm based upon their equipment. We will undertake risk assessments in consultation with external authorities as well as Babcock who commented favourably upon the safety aspects of the new test cell referred to above.



The programme below is shown as a list of research topics associated with a particular component or components of the total CESAR system. Considered estimates are made of the duration of each item although some can overlap. This is particularly the case for the final listed item, development of the control system. Further, the prototype accumulator system will require subsequent design and development to match vehicle geometry and this part of the total programme will latterly repeat and parallel the items listed.

4





1.

Performance tests of a Wankel engine in normal combustion mode to determine flow rates of      fuel and air, thermal efficiency and exhaust temperatures over a range of speed and power output.

3 - 4 weeks



2.

Performance tests of Wankel engine with one cylinder driven by       compressed air to simulate the vapour in the final operation. The other can be similarly driven or operated in normal combustion mode to create a data base of the performance criteria as listed in item 1

4 6 weeks



3.

Heat transfer tests upon the evaporator of the prototype accumulator using a twin lobe Mazda Wankel engine to supply the heated air. Times for attainment of a range of specified vapour pressures will be recorded for gas stream temperatures up to 600C. The corresponding discharge times for a range of starting pressures and outlet vapour flow rates expanded through the reciprocating steam engine will provide data on the total power output..

8 - 10 weeks



4.

The tests scheduled as item 3 will be repeated using the exhaust of the second Wankel engine in combustion mode as the source of charging heat for the accumulator over a wide range of practicable operating conditions for both components.

8  10 weeks



5.

Throughout the tests scheduled as items 1,2, 3 and 4 above, experiments will be required to provide empirical data for the continuing design and optimisation of the control of the CESAR system.



These must be regarded as in almost continuous parallel operation with the total research and development  programme.  We will begin work to use the steam engine to blow hot air into the Wankel engine for analysis and tests as a prelude to doing tests on steam.   This work will begin when the steam accumulator is delivered by Mitsui Babcock mid March 2007.   Once all of the parameters are established for operations, we will begin work to use steam and gas by mid June 2007.



(c)   Off-balance sheet arrangements



Not Applicable



ITEM 3. CONTROLS AND PROCEDURES



We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the United States Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our President and acting Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.



We carried out an evaluation, under the supervision and with the participation of our management, including our President and acting Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-14 as of the end of period covered by this report.  Based upon the foregoing, our President and our acting Chief Financial Officer concluded that our disclosure controls and procedures are effective.

5





There were no changes in our internal control over financial reporting identified in connection with the evaluation referred to in the immediately preceding paragraph that occurred during our last fiscal quarter that has materially affected or is reasonably likely to materially affect, our internal control over financial reporting.



PART II  OTHER INFORMATION

ITEM 1.

LEGAL PROCEEDINGS



None.

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Not Applicable

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

None.



ITEM 4.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS



Not Applicable



ITEM 5.

OTHER INFORMATION



By an agreement dated January 4, 2007, the Company executed an Investment Agreement and a Registration Rights Agreement with the Dutchess Private Equities Fund Ltd. ("Dutchess").  Under the terms of these agreements, Dutchess will provide an equity line of credit of $10,000,000 to be taken down at the Company's election, either a) 200% of the average US daily volume of the common stock for the 10 trading days prior to the put notice date multiplied by the average of the three daily closing bid prices immediately proceeding the put date or b) $250,000 upon the registration of the initial amount of 10,000,000 common shares by the Company which will be used for the draw down of funds.  The registration statement is to provide for the offering of securities on a continuing basis and the Company must use its best efforts to have the registration statement effective within 120 days for the date of the agreements.  The agreement further calls for the Company to pay a 1% fee to a registered broker dealer to a maximum of $10,000 on each draw down of funds under the Investment Agreement.  The Company has retained legal counsel to prepare the registration statement for filing with the Securities and Exchange Commission.





6



ITEM  6.

EXHIBITS



Exhibit Index

|3.1  | Articles of Incorporation                                                                                                                                               | Incorporated by reference to our SB-2 registration statement filed on March 15, 2004
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------
|3.2  | Bylaws                                                                                                                                                                  | Incorporated by reference to our SB-2 registration statement filed on March 15, 2004
|3.3  | Amendment to Articles of Incorporation dated June 12, 2006                                                                                                              | Incorporated by reference to our Form 8-K filed on July 21, 2006                    
|3.4  | Amendment to Articles of Incorporation dated June 13, 2006                                                                                                              | Incorporated by reference to our Form 8-K filed on July 21, 2006                    
|3.5  | Amended and Restated Bylaws dated August 31, 2005                                                                                                                       | Filed herewith                                                                      
|10.1 | Agreement and Plan of Merger between the Company, Clean Energy and Power Solutions Inc. and the shareholders of Clean Power Technologies Inc. executed on May 22, 2006. | Incorporated by reference to our Form 8-K filed on July 21, 2006                    
|10.2 | Memorandum of Understanding between the Company and Mitsui Babcock Energy Limited dated September 11, 2006                                                              | Incorporated by reference to our Form 8-K filed on September 12, 2006               
|10.3 | Collaboration Agreement between the Company and Mitsui Babcock Limited dated October 11, 2006                                                                           | Incorporated by reference to our Form 8-K filed on October 19, 2006                 
|22.1 | Notice of Annual Meeting of Shareholders                                                                                                                                | Incorporated by reference to our Schedule 14C filed on March 14, 2006               
|22.2 | Notice of Proposal for approval of agreement and plan of merger, forward split and name change                                                                          | Incorporated by reference to our Schedule 14C filed on May 18, 2006                 
|31.1 | Section 302 Certification - Principal Executive Officer                                                                                                                 | Filed herewith                                                                      
|31.2 | Section 302 Certification - Principal Financial Officer                                                                                                                 | Filed herewith                                                                      
|32.1 | Certification Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                   | Filed herewith                                                                      
|32.2 | Certification Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                   | Filed herewith                                                                      



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SIGNATURES



Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on this 22ndday of January, 2007.



CLEAN POWER TECHNOLOGIES INC.





By:/s/ Abdul Mitha

Name: Abdul Mitha

Title: President/CEO, principal executive officer



By: /s/ Diane Glatfelter

Name: Diane Glatfelter

Title: Chief Financial Officer, principal financial officer



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