Capacitor firm Maxwell Technologies is to work with hybrid propulsion systems developer ISE to design high-voltage energy storage systems.
The two companies signed a memorandum of understanding (MoU) outlining the strategic alliance to develop the technology.
Under the agreement, the storage systems will be developed for use in fuel efficient and low emission hybrid buses and trucks.
The agreement will see the two companies sharing resources to develop the solutions, with ISE committing to source ultracapacitor cells exclusively from Maxwell.
Maxwell president and chief executive officer David Schramm said: "Both of our companies' technology and products have come a long way since then.
"New regulations aimed at reducing CO2 emissions are driving demand that is bringing hybrid drive systems squarely into the transportation mainstream."
Rick Sander, president of ISE, said he was thrilled at the opportunity to expand its collaboration with Maxwell, which began in 2002 with the supply of Boostcap ultracapacitors for braking energy recuperation and torque assist systems.