By Jorn Madslien
Business reporter, BBC News
Power is increasingly coming from the mains rather than from petrol stations.
For decades, the motor industry has been telling us that electric motoring is just around the corner.
And for decades all the carmakers came up with was hot air on a scale rivalling the electric power stations that were to fuel these futuristic vehicles.
This time will be different, the carmakers insist, and these are the reasons why.
For starters, modern lithium-ion batteries are much more efficient than old battery technologies.
Such batteries have already been installed in prototype cars, such as BMW's Mini E and Daimlers' electric Smart.
True, the batteries remain huge, so the Mini has no back seats.
Mini E designer Patrick Fuller demonstrates the car that engineers say can travel 150 miles before its battery needs to be recharged.
But it handles like an ordinary car, it offers a range of 150 miles per two-hour charge and it is already available in the US for customers who are prepared to pay some $850 a month to take part in a trial project.
Californian upstart Tesla and Italian design house Pininfarina are amongst the rivals also offering lithium-ion powered electric cars.
Both firms are widely admired for their efforts, but remain unproven in an industry where even volume manufacturers such as Toyota often have to recall vehicles.
The problem all electric cars share, regardless of their battery technology, is that their range is limited. Better batteries can only extend the range and reduce charging times.
So the motor industry has come up with an answer, dubbed plug-in petrol-electric hybrids.
Toyota is ahead of the pack, currently trialling a car that is powered by a battery for the first few miles. Once it runs out, a conventional petrol engine takes over.
General Motors favours an alternative solution, where a small petrol engine recharges the battery whilst driving.
Since most journeys are shorter than 40 miles, many drivers would buy almost all their power from electricity providers rather than from petrol stations.
This is a crucial reason why the future of electric motoring looks brighter than ever before. The UK government is not alone in pushing for both low carbon transport solutions as well as a shift towards less polluting ways to generate electricity.
Governments rely on taxing cars
Electric cars, which need recharging, can help and this is how.
In the future, more of the UK's electricity is expected to come from nuclear power stations or from alternative energy sources such as wind or wave power. Both produce energy when they can rather than when consumers want it.
Nuclear power stations are less able than, say, coal fired power stations to adjust production to meet demand peaks during the day and troughs at night. Similarly, wind and wave power will produce a lot of electricity during a stormy night, regardless of whether or not consumers and companies want it.
Electricity generated at night when nobody wants it must either be stored or it will be lost. If the UK as a nation had a fleet of these cars being charged overnight, then the power industry's income from drivers would come on top of the income it currently gets from homes and companies.
Hence, electric motoring could improve the economics of both nuclear power and alternative energy and thus play a central part of the government's desire to push for a low carbon economy.
A shift in drivers' spending away from the oil industry would also lead to a sharp reduction in government income from heavily-taxed petrol and diesel.
Electricity firms are challenging the oil industry
Over time, therefore, the government might want to tax electric motoring to plug the gap in its finances, and consumers could see the cost of electric motoring rise over time.
But this is unlikely to happen until electric motoring has become mainstream.
Until then, those who drive electric or plug-in petrol-electric cars will not only receive a subsidy to buy the car in the first place, perhaps in the region of £5,000 if the UK proposal goes ahead.
The fact that they are being taxed less than other motorists means they will also be receiving indirect subsidies on a relatively large scale, with a slew of initiatives ranging from no tax on the fuel they use to low or no road tax, or exemptions from the London Congestion Charge.
Such initiatives, however, will not be enough to make electric motoring cheap, and carmakers are very aware of the need to make electric and plug-in hybrids affordable.
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Indeed, the industry has realised that lowering the price may not in itself be enough to convince consumers to switch.
Consumers will be concerned about resale values and repair costs. With electric cars, these questions are particularly pertinent because modern batteries remain untested.
Carmakers are therefore working hard to come up with marketing innovations to match technological developments.
Leasing agreements, where manufacturers look after the batteries for the length of a car's life, offer one solution, though the motor industry will also be looking at package deals where, for instance, urban electric car buyers get a number of weekends away in conventional petrol-powered load-lugging cars.
Consumers will also be concerned about where to recharge their cars. Ordinary sockets found in homes and garages are not really good enough to quickly charge tomorrow's electric cars.
Dedicated high-voltage charging points can be installed for about £2,000, according to one major carmaker's estimate.
The government will step in with more subsidies to assist with the roll-out of charging points in city streets and car parks.
And the electricity industry - most notably the nuclear industry - will no doubt do its bit to roll out the infrastructure required to enable it to compete with petrol stations and the oil sector.
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