A dual-energy storage system is described, having two energy sources: (a) a fast-energy storage devices (FES) such as an ultracapacitor, and (b) a long duration or steady power device, such as a fuel-cell or battery. A power converter or controller executes an energy management algorithm to determine when to provide bursts of additional power/current from the fast-energy storage device, and when to recharge the fast-energy storage device.A method is further described of adaptively managing the state of charge of an ultracapacitor or other Fast Energy Storage device in the dual energy storage system of a Plug-in Hybrid propulsion system. The method provides good protection of the battery, good performance, and minimizes the required capacity of the ultracapacitor.