(FORTUNE Magazine) – Remember cold fusion, Corfam, and Tang? Well, electric vehicles (EVs) seem destined to join them on the trash heap of history: once-heralded technological breakthroughs whose time never came.

Several states are backpedaling from laws that require automakers to sell some battery-powered cars by 1998 to reduce exhaust emissions. Massachusetts now says it will be "flexible" on the deadline. New York Governor George Pataki recently suggested that he won't insist on meeting it either, if the technology isn't ready. "We want it to be something that can be achieved," he said.

Enthusiasm has also softened in that onetime hotbed, California. Visions of a giant new EV industry that would replace aerospace in the economically depressed state have become more pragmatic. Lately EV supporters such as Calstart are beating the drum for a giant government grant to "level the playing field" with gasoline-powered vehicles. They contend that the oil industry gets $300 billion a year in subsidies like the oil-depletion allowance. The $65 billion spent on the defense of the Persian Gulf? An oil subsidy, says Calstart. Give EVs some of that, says the group, and "the unparalleled benefits of driving an EV will be evident."

Unparalleled indeed: a range of 50 to 80 miles in normal city driving and less than half that when the thermometer drops to zero, snow covers the road, and the headlights are on. At a high price too. Dennis Virag, managing director of the Automotive Consulting Group in Ann Arbor, Michigan, a technical consulting firm, says: "EVs in production will cost $10,000 apiece more than comparable vehicles because of the lightweight materials, unique structures, and energy-saving systems." Batteries are included, but you have to replace them every couple of years at $2,000.

For all that, the environmental payoff is skimpy. That's because emissions from power plants that produce the electricity to charge the batteries must be factored in. A new report by Booz Allen & Hamilton says the output of particulates would rise, as would sulfur dioxide emissions.

Having created the problem by mandating zero-emission vehicles, the California Air Resources Board may be seeking a graceful way out, such as hybrids--EVs with an auxiliary gasoline engine that charges the batteries while the vehicle is moving.

Even if the laws stay on the books, automakers say privately they would rather pay the $5,000-per-vehicle annual fine than build white elephants no one will buy. And as Virag points out, forcing every maker to build EVs guarantees that there will be excess competition. If the companies engineered zero-emission vehicles on their own, the probability of developing a commercially acceptable one would be much greater.

--Alex Taylor III