The present invention provides a system and method relating to the operation of plug-in hybrid electric vehicles powered both by electricity from rechargeable batteries and by consumable fuel powered means, such as an internal combustion engine or a fuel cell. More particularly, the system and method of the claimed invention enable optimization of the energy cost associated with the operation of such plug-in hybrid electric vehicles, especially when the cost of recharging batteries from external electric power sources may be less than the cost of recharging batteries from the onboard consumable fuel powered means. To this end, the invention enables maximization of the use of electricity from external electric power sources and minimization of the use of electricity produced by the plug-in hybrid electric vehicle's onboard consumable fuel powered means, when the cost of recharging batteries from external electric power sources is less than the cost of recharging batteries from the onboard consumable fuel powered means.