EXHIBIT
99.1





Power
Efficiency Corporation Reports Second Quarter 2009 Financial
Results





Finishes
Quarter with Two OEM Agreements





August
14, 2009 – Las Vegas, NV – Power Efficiency Corporation (OTCBB:PEFF.OB), a clean
tech company focused on efficiency technologies for electric motors, today
announced its second quarter 2009 financial results and updated stockholders
about the Company’s progress.





The
Company’s technology platform, called E-Save Technology®, reduces the amount of
electricity used by electric motors that are at times lightly loaded and operate
at a constant speed.  Power Efficiency estimates E-Save Technology has
the potential to save $1.7 billion in electricity a year in industrial
applications alone in the U.S.





The
Company has developed two products based on E-Save Technology.  One is
a Three Phase Motor Efficiency Controller (MEC), which improves the efficiency
of motors in escalators, elevators, granulators, saws, stamping presses,
conveyors, crushers and many other industrial applications.  The
second is a Single Phase MEC, which is targeted at small motors in clothes
washers and dryers, refrigerators and other appliances and light commercial
equipment.  In 2008 the Company released “digital” versions of these
products that have significantly enhanced features and capabilities over the
Company’s historical analog-based product.  These improvements make
the MEC capable of being adopted by OEMs and other large volume sales
channels.





Sales for
the quarter ended June 30, 2009 were $75,393. For the quarter, industrial market
sales of $44,584 exceeded vertical transportation market sales of $30,809. This
was primarily because the digital product was not accepted and internally
launched by some of our largest customers until very late in the
quarter.





Net loss
for the quarter, including $95,894 in non-cash expenses related to stock based
compensation and $848,222 in non-cash gains related to unrealized loss on the
fair value of certain outstanding warrants, was $178,365.  Excluding
these non-cash amounts, the Company lost $930,693 in the quarter. The Company
recorded a gross margin of $25,837, or 34%.





Steven
Strasser, the Company’s Chairman and CEO, stated, “We announced the signing of
two contracts with major OEMs in the vertical transportation market in the
second quarter.  We are now promoting awareness of these products
through the field offices and national account managers of these
OEMs.  To date, we have received several orders under those contracts,
including an initial order for escalator modernization at one of the nation’s
major airports.  Overall, we expect sales through these contracts to
ramp up over time as the product is incorporated in these companies’ sales
proposals, ultimately growing revenue significantly in future
quarters.  We are working hard on additional OEM agreements in
vertical transportation.”





“We are
also expanding our industrial market sales efforts through the development of an
independent representative network.  We have received a very positive
reaction from these reps and expect to sign up highly qualified representatives
with strong customer relationships and deep expertise in related
technologies.  We expect to have most of this rep network in place by
the end of the third quarter.  By the end of the year we expect to
have reps across the country trained and actively selling our
product.  Overall, we believe these OEM agreements and reps will
enable the Company to become a highly valuable energy technology
provider.”





“I am
pleased with our 34% gross margin for the quarter.  For building long
term stockholder value, this gross margin and the larger volume agreements and
channels are most important.”




Strasser
continued, “The macro environment for our products continues to
improve.  Saving energy is frequently cited as the least expensive
“source” of power and it reduces CO2 emissions from electricity
generation.  If regulation of CO2 emissions is enacted by the U.S., as
many anticipate happening before the international climate meetings in
Copenhagen this winter, our products would provide users an additional form of
cash flow – emission reduction credits.”









About Power Efficiency
Corporation


Power
Efficiency Corporation is a clean tech company focused on efficiency
technologies for electric motors. Power Efficiency is incorporated in Delaware
and is headquartered in Las Vegas, Nevada. The Company has developed a patented
and patent-pending technology platform, called E-Save Technology, which has been
demonstrated in independent testing to improve the efficiency of electric motors
by up to 35% in appropriate applications. Electric motors consume over 25% of
the electricity in the U.S. and many operate inefficiently. E-Save Technology
can be licensed to motor, controls and equipment manufacturers. Power
Efficiency’s products, based on E-Save Technology, include an Industrial Motor
Efficiency Controller for three phase applications, such as escalators,
crushers, granulators, mixers, saws and MG elevators, and a new Appliance Motor
Efficiency Controller for small single phase applications such as residential
and light commercial appliances. For more information, go to www.powerefficiency.com.





As a
cautionary note to investors, certain matters discussed in this press release
may be forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Such matters involve risks and uncertainties that
may cause actual results to differ materially, including the following: changes
in economic conditions; general competitive factors; acceptance of the Company’s
products in the market; the Company’s success in technology and product
development; the Company’s ability to execute its business model and strategic
plans; and all the risks and related information described from time to time in
the Company’s SEC filings, including the financial statements and related
information contained in the Company’s SEC filing. Power Efficiency assumes no
obligation to update the information in this release.





Contact:


BJ
Lackland, CFO


Power
Efficiency Corporation


Tel:
702-697-0377