London (CNN Business) Airlines ordered tens of billions of dollars worth of new aircraft from Airbus and Boeing at the Paris Air Show this week. But there was also huge interest in the planes of tomorrow.

The rise of hybrid and electric aircraft was on full display at the biannual aviation showcase , where startups competed with industry giants to show off technology that's more efficient and better for the environment than traditional designs.

The focus on electrically-propelled aircraft reflects a rush to develop urban flying taxis (coming soon) and longer range fully electric planes (coming later).

According to the consultancy Roland Berger, the number of electric aircraft in development increased by roughly 50% over the past year to 170. The number could swell to 200 by the end of 2019.

There are two big factors driving increased investment: The global aviation industry produces up to 3% of all carbon dioxide (CO2) emissions, a share that's projected to increase sharply in coming years; and it spends roughly $180 billion a year on jet fuel.

"Increased efficiency has been the name of the game when selling aircraft for decades," said Nikhil Sachdeva, a senior consultant at Roland Berger. "Electric is the next phase."

Cape Air goes electric

Grabbing most attention in Paris was Israeli planemaker Eviation Aircraft with its announcement that US regional carrier Cape Air would be the first customer for Alice, its electric airplane.

Alice can fly nine passengers up to 650 miles on a single charge, and Eviation claims it can cut airline operating costs by 70%. Manufacturing gets underway in the United States this year.

The plane uses one main "pusher" propeller at the tail, and two more on the wingtips. They are powered by batteries. The plane cruises at 10,000 feet.

A visitor to the Paris Air Show looks at the Alice electric aircraft manufactured by Eviation Aircraft.

'Third era of aviation'

The air show also saw a major deal by two European industrial heavyweights.

Rolls-Royce RYCEF Siemens GCTAF UK engineering companypurchased the electric and hybrid-electric aerospace propulsion business of Germany's. The deal is expected to close later this year.

The eAircraft business is based in Germany and Hungary, and employs around 180 specialist engineers who are developing electric and hybrid propulsion systems.

"Electrification is set to have as dramatic an impact on aviation as the replacement of piston engines by gas turbines," said Rob Watson, a director at Rolls-Royce. "We are at the dawn of the third era of aviation."

Hybrid aircraft by 2022

United Technologies UTX Raytheon RTN announced plans to merge with defense contractorjust prior to the Paris Auto Show.

And the company had some tech to show off to aviation enthusiasts, pulling back the curtain on a hybrid electric project. The goal is to have planes in the air by 2022.

The plane is built on a mid-sized regional turboprob, using the existing airframe, systems and propellers. What's new is batteries and a 2-megawatt hybrid-electric propulsion system.

A visualization of additions made as part of United Technologies' hybrid project.

Airbus EADSF is also aiming to test a hybrid aircraft by 2022, and it announced a collaboration this week with European aerospace firms Daher and Safran to get there.

Safran SAFRF Daher will handle components and systems installation, whilewill contribute a propulsion system called EcoPulse. Airbus will tackle batteries and aerodynamic design.

A visualization of a plane equipped with EcoPulse.

The plane will run on a distributed hybrid propulsion system, which includes a turbogenerator that powers electric motors and propellers.

Airbus also said this week that it has signed a memorandum of understanding with SAS Scandinavian Airlines to research hybrid and electric aircraft systems.