GreenHunter Energy Reports Second Quarter 2010 Financial Results

GREENHUNTER ENERGY, INC. (NYSE Amex: GRH), a diversified renewable energy company focused on biomass power generation, biodiesel development, and wind and solar energy projects, announced today financial and operating results for the three and six months ended June 30, 2010.

Net loss to common shareholders from continuing operations for the three months ended June 30, 2010, including one-time items, was $1.5 million ($0.07 loss per common share) compared to a net loss of $1.1 million ($0.06 loss per common share), from continuing operations, in the second quarter of 2009.

For the six months ended June 30, 2010, GreenHunter reported a net loss of $7.0 million ($0.31 loss per common share), as compared to a net loss of $4.3 million ($0.20 loss per common share) for the six months ended June 30, 2009.

KEY INITIATIVES

Since the beginning of 2010, GreenHunter Energy management has been focused on three key initiatives. These include (i) engineering, permitting and financing the 18 MW Mesquite Lake biomass plant located in Imperial County, California; (ii) assembling a pipeline of growth projects and acquisition candidates predominantly focused in the baseload power sector; and, (iii) restructuring the non-recourse credit agreement with the senior secured lender related to the biodiesel refinery located in Houston.

As announced last year, the power purchase agreement with Imperial Irrigation District (IID) specifies a commercial operation date for the Mesquite Lake biomass project by the end of June 2011 – a target management presently believes is achievable. During the second quarter, GreenHunter Mesquite Lake (GHML) made significant progress with respect to engineering the refurbishment and conversion of the facility. In July, GHML obtained its Authorization to Construct air permit from the Imperial County Air Pollution Control District.

Meanwhile, the low crude oil price environment, the expiration of the blenders’ tax credit for biodiesel at the end of calendar year 2009, and the delayed implementation of the Renewable Fuels Standard 2 (RFS 2), have limited the company’s ability to operate or find a buyer for its biodiesel facility in Houston. On June 3, 2010, BioFuels received a written notice from the lender that BioFuel’s assets pledged to the bank were placed into receivership.

MANAGEMENT COMMENTS

Commenting on GreenHunter Energy’s second quarter 2010 financial and operating results, Mr. Jonathan D. Hoopes, President and Chief Operating Officer, stated, "During the second quarter of 2010, we have made significant progress at our Mesquite Lake biomass project located in Southern California. With our air permit in hand, we are looking forward to marketing and closing the $29.9 million Recovery Zone Facility Bond financing which will provide the necessary capital for our refurbishment, conversion and commercial start-up of the facility. Meanwhile, our business development efforts have resulted in over 250 MW (net) pipeline of baseload power acquisition candidates, some of which have progressed to the stage of active negotiations for possible purchase. We anticipate the remainder of 2010 to yield further progress on our key initiatives.”

Forward-Looking Statements

Any statements in this press release about future expectations and prospects for GreenHunter Energy and its business and other statements containing the words "believes,” "anticipates,” "plans,” "expects,” "will” and similar expressions constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including the substantial capital expenditures required to fund its operations, the ability of the Company to implement its business plan, government regulation and competition. GreenHunter Energy undertakes no obligation to update these forward-looking statements in the future.

GreenHunter Energy is focused on the renewable energy sectors of wind, hydro, geothermal, solar, biofuels, and biomass power plants. Our assets consist of a residual interest in the future development of a wind energy project located in California, one of the nation’s largest biodiesel refineries located in Houston, Texas, and a biomass-fired power plant located near Imperial, California. Headquartered in Grapevine, Texas, GreenHunter Energy was formed to be the first publicly traded renewable energy company based in the U.S. that provides to investors a portfolio of diversified assets in the alternative energy sector. Additional information about GreenHunter Energy may be found at www.greenhunterenergy.com.