The hybrid vehicle typically achieves greater fuel economy and lower emissions than conventional internal combustion engine vehicles (ICEVs), resulting in fewer emissions being generated. These savings are primarily achieved by three elements of a typical hybrid design:

  1. Relying on both the engine and the electric motors for peak power needs, resulting in a smaller engine size more for average usage rather than peak power usage. A smaller engine can have less internal losses and lower weight.
  2. Having significant battery storage capacity to store and reuse recaptured energy, especially in stop-and-go traffic typical of the city driving cycle.
  3. Recapturing significant amounts of energy during braking that are normally wasted as heat. This regenerative braking reduces vehicle speed by converting some of its kinetic energy into electricity, depending upon the power rating of the motor/generator;

Other techniques that are not necessarily ‘hybrid’ features, but that are frequently found on hybrid vehicles include:

  1. Using Atkinson cycle engines instead of Otto cycle engines for improved fuel economy.
  2. Shutting down the engine during traffic stops or while coasting or during other idle periods.
  3. Improving aerodynamics; (part of the reason that SUVs get such bad fuel economy is the drag on the car. A box shaped car or truck has to exert more force to move through the air causing more stress on the engine making it work harder). Improving the shape and aerodynamics of a car is a good way to help better the fuel economy and also improve vehicle handling at the same time.
  4. Using low rolling resistance tires (tires were often made to give a quiet, smooth ride, high grip, etc., but efficiency was a lower priority). Tires cause mechanical drag, once again making the engine work harder, consuming more fuel. Hybrid cars may use special tires that are more inflated than regular tires and stiffer or by choice of carcass structure and rubber compound have lower rolling resistance while retaining acceptable grip, and so improving fuel economy whatever the power source.
  5. Powering the a/c, power steering, and other auxiliary pumps electrically as and when needed; this reduces mechanical losses when compared with driving them continuously with traditional engine belts.
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These features make a hybrid vehicle particularly efficient for city traffic where there are frequent stops, coasting and idling periods. In addition noise emissions are reduced, particularly at idling and low operating speeds, in comparison to conventional engine vehicles. For continuous high speed highway use, these features are much less useful in reducing emissions.

SOURCE:  wikipedia