An alliance between Ford and electricity utility Southern California Edison should see plug-in hybrid vehicles (PHEV) available from the auto maker within the next 5 – 10 years, according to Ford. This announcement was made just before the International Energy Agency warned that the world will face a major oil crunch in five years.According to Ford, one of the biggest hurdles they need to clear is the development of lithium ion batteries that can be repeatedly and quickly charged by regular household electrical outlets. The Escape currently uses a nickel-metal-hydride (NiMH) batteries that charge automatically while the car is in motion. A generator diverts energy from the gasoline engine and the braking system to recharge the batteries.

Ford will provide Southern California Edison with 20 model year 2008 Ford Escape Hybrid sport utility vehicles, with the first to be delivered by the end of this year to commence conversion and testing.

A report from the U.S. Department of Energy (PDF) estimates that if every light duty car and truck currently in the USA used plug-in hybrid technology, nearly three quarters could be plugged in and recharged by excess capacity in the electricity grid without constructing a single new power plant. That’s great, now we just need to get those power plants a little greener .

The struggling car marker has been experiencing massive financial losses and reducing market share in recent years – with the addition of the looming oil crisis, this is really make or break time for Ford. Although Ford was the first U.S. car maker to release a gasoline-electric hybrid on the market (Escape) in 2004, they’ve been often criticized by environmental commentators for having since lost momentum in the hybrid market; overtaken by companies such as Honda.