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Because Plug-in Hybrid Electric Vehicles (PHEVs) substitute electrical power from the utility grid for fuel, they have the potential to reduce petroleum use significantly. However, adoption of PHEVs has been hindered by expensive, low-energy batteries. Recent improvements in Li-ion batteries and hybrid control have addressed battery-related issues and have brought PHEVs within reach. The FreedomCAR Office of Vehicle Technology has a program that studies the potential benefit of PHEVs. This program also attempts to clarify and refine the requirements for PHEV components. Because the battery appears to be the main technical barrier, both from a performance and cost perspective, the main efforts have been focused on that component. Working with FreedomCAR energy storage and vehicle experts, Argonne National Laboratory (Argonne) researchers have developed a process to define the requirements of energy storage systems for plug-in applications.