Amerigon Inc. said the U.S. Department of Energy has authorized a team led by Amerigon's BSST subsidiary to proceed with phase two of a $6.3 million FreedomCAR project to create a thermoelectric system that can improve fuel economy by converting waste heat in automobile engine exhaust into electrical power.

In phase one of the project, the team convinced the DOE that such a thermoelectric system is technically feasible. Phase two, which is expected to take about a year, will focus on developing the major system subcomponents and supporting processes.

Team members in addition to BSST include BMW of North America; University of California, Santa Cruz; Purdue University; the DOE's National Renewable Energy Laboratory; and the Jet Propulsion Laboratory/California Institute of Technology.

Amerigon also said it expects revenue for the year ending Dec. 31 to be up about 10% from 2004 and revenue for 2006 to increase by as much as 30%. President and CEO Daniel R. Coker said the firm expects to report its second consecutive year of profitability in 2005 and to increase net income in 2006. Its Climate Control Seat is currently available on 18 vehicle models.