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The objective of this study is to improve fuel economy and reduce carbon dioxide emissions in diesel-electric hybrid automotive powertrains by developing an exhaust gas turbine generator system which utilizes exhaust gas energy from the turbocharger waste gate. The design of the exhaust gas turbine generator was based on a conventional turbocharger for a direct-injection diesel engine. Data from steady-state bench tests using air indicates about 50% of the turbine input energy can be converted to electric energy. Turbine generator output averaged 3 kW, while a maximum of about 6 kW was observed. Based on this data, we estimate that energy consumption in a vehicle could be reduced between 5% and 10%. Engine tests were conducted under both steady-state and transient conditions. These tests revealed that optimal performance occurred under high-speed, high-load conditions, typical of highway or uphill driving, and that performance at low-speed, low-loads was relatively poor.