The new car, called i MiEV (Mitsubishi innovative Electric Vehicle), is equipped with a single motor, unlike the Colt and Lancer Evolution electric cars, which use in-wheel motors.

After being dismissed as impractical due to their short driving range and long hours needed for recharging, electric vehicles have returned to the drawing board thanks largely to the development of advanced, lightweight lithium ion batteries.

Japan's Fuji Heavy Industries Ltd., the maker of Subaru cars, is also working with TEPCO to develop cheaper and more efficient electric cars.

A Mitsubishi Motors spokesman said 2010 was one target for offering marketable electric vehicles by stretching their driving range to 250 km (155 miles) from up to 160 km (100 miles) now. But he stressed that the need for special infrastructure and higher recharging speeds meant auto makers were powerless to achieve this on their own.

If such issues are resolved, electric vehicles could be a more attractive alternative to fuel-cell vehicles, which require massive investment for hydrogen fuelling stations, among other hurdles.

Other utilities due to join the study are Kyushu Electric Power Co., Kansai Electric Power Co. and Hokuriku Electric Power Co.