ALISO VIEJO, Calif., Oct.3, 2006 —— XsunX, Inc. (XSNX), developer of advanced manufacturing systems and cell structures for solar energy, today announced it has submitted a completed grant response for project funding opportunities under the President's Advanced Energy Initiative, under the Technology Pathway Partnerships Phase 1 program. This program is designed to promote the commercialization of emerging technologies in thin film photovoltaics, manufacture, and systems integration.

Key respondents will be tapped by the U.S. government to diminish the country's dependence on foreign energy sources, via the President's Advanced Energy Initiative. Its 2007 Budget proposes a $148 million Solar America Initiative (SAI); an increase of $65 million over the FY06 budget.

The stated purpose of the Solar America Initiative is to accelerate the development of advanced solar electric technologies, with the goal of making them cost-competitive with other forms of renewable electricity by 2015.

The XsunX Grant response was prepared in conjunction with Sandia National Laboratories (Albuquerque, NM), and the National Renewable Energy Laboratory (Golden, CO). TRACO Windows and Doors (Cranberry Township, PA) was listed within as one of the manufacturing support sources by XsunX.

The Grant response was successfully submitted, per request, on Oct. 2, 2006.

According to Kurt Richard Laetz, VP of Global Sales and Marketing, “The government subsystem program we responded to can fund half a project cost up to $8 million dollars. It looked to create vertically integrated groups of technology partners, enticing them to come together and provide innovative new ways to apply the solar energy opportunity to our environments.”

"Responding to this Grant fits in with our existing business plan which emphasizes the development of cost-effective building integrated photovoltaics or 'BIPV' applications with partners from other industries such as the glass and glazing industries. XsunX has already made significant strides in developing manufacturing methods and proprietary thin film solar cell designs for converting the large areas of modern high rise glass facades into energy saving, power producing structures. We hope that these efforts may now assist our government in its effort to establish renewable energy sources for the future.”
The Solar America Initiative, managed by the U.S. Department of Energy Solar Energy Technology Program (SETP), has established goals to develop partnerships and strategic alliances with industry participants, universities, Federal and state government, and other non-governmental agencies. The two primary areas of focus of the SAI are to develop Technology Pathway Partnerships for research and development on PV component and
system designs, including low-cost approaches for manufacturing; and Technology Acceptance activities that address marketplace barriers and offer the opportunity for market expansion.

About XsunX

Based in Aliso Viejo, Calif., XsunX is developing and commercializing innovative new thin film photovoltaic (TFPV) solar cell technologies and manufacturing processes to service expanding global energy demands. The Company has focused its efforts on lowering the cost per watt of solar power and making solar cell technology easier to use in a wide variety of applications. XsunX calls this dual improvement to cost and efficiency the XFactor(tm). The XFactor delivers licensee's solar cell designs that break the bounds of crystalline silicon dependency, rigid and limited-use form factors, and rapid efficiency loss. Equally important, the XFactor provides new manufacturing techniques that can significantly lower production costs and allow for easier additions to production capacities and technology upgrades without having to re-build and re-tool. Together, XsunX design and production innovations offer manufacturers of solar products exciting new application opportunities and reductions to the cost per watt of solar power. More information can be found at the Company's website:

For more information, contact Investor Relations at XsunX, Inc. (888) 797-4527

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