NAGOYA (Kyodo) Toyota Motor Corp. and Microsoft Corp. plan to form an information technology alliance under which they will cooperate in developing infrastructure for the diffusion of environmentally friendly vehicles, industry sources said Wednesday.

Toyota President Akio Toyoda and Microsoft Chief Executive Officer Steve Ballmer will hold a news conference Thursday morning to announce the alliance, they said. The news conference will be broadcast online.

The infrastructure is expected to include a next-generation electricity distribution system called a "smart grid" to improve energy efficiency through measures such as battery storage of electricity generated by solar and wind power, the sources said.

If the batteries in plug-in hybrids that Toyota plans to release in early 2012 are compatible with those for home use, it could contribute to the spread of the smart grid system and help conserve energy, they said.

The companies may also consider taking advantage of Microsoft technology to allow mobile phones to be used for checking electricity left in batteries for plug-in hybrids and for operating home appliances, they said.

Microsoft software may be used for information systems in Toyota cars to allow for easy access to traffic jam and other data.