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To extend the lithium-ion (Li-ion) battery cycle life, an active combination of an ultracapacitor (UC) with an energy-dense Li-ion battery is shown as a promising approach for electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs). In this paper, the problem of the sizing of the Li-ion battery and UC, as well as the degree of hybridization between the UC power and battery power, is approached from a new perspective, i.e., by solving an optimization problem to minimize fuel consumption. To implement this optimized power sharing in real time, a novel energy management strategy is proposed, which includes battery power reference generation, UC state-of-charge regulation, and forecast control based on the driver commands. Finally, simulations and experiments in which the flywheel + generator + controlled load is used to emulate the vehicle drivetrain are provided to verify the reduced stress on the battery current and the improved fuel economy achieved by the proposed method.