Tracked down some more info. Re the comparison between an auto engine and a Sulzer marine engine, do not forget to account for the difference in scale of the engines. It's easier to get the best operating point of a large-displacement low RPM engine to have a better BSFC than for a smaller displacement higher RPM (and therefore lighter) engine. As of a couple of years ago, the VW TDI 110hp engine at its best operating point have the lowest BSFC of any auto engine. Truck engines can have a little better BSFC - but they're bigger, and a lot of that is BECAUSE they are bigger. The level of technology is about the same.
In this link, the BSFC map of a 1.9 litre 90 hp VW TDI engine can be seen:
Note that the best point is 197 g/kWh. If you allow a 15 percent deviation (to simplify drivetrain design) and follow the 230 g/kWh line, max load can be as high as 3500 rpm and 12 bar BMEP, and lowest load can be as low as 1000 rpm 5 bar BMEP, although in practice this engine will not be "happy" at such low RPM; 1500 rpm 5 bar BMEP is a more practical minimum that won't feel like "lugging". Still, this gives a range of more than 5 between max and min power output that are within (roughly) 15% of the best-efficiency operating point.
If you have a tailored application, it might be possible to get a few points better BSFC by eliminating the off-design conditions, but for one thing this will be a difficult challenge (VW TDI engines are regarded as being close to state-of-the-art in this respect) which suggests that the margin for further improvement is probably low for an engine on that scale. For another, if the objective is having low fuel consumption of the vehicle as a whole, the importance of considering the WHOLE system (vehicle, weight, aerodynamics, usable space inside, rolling resistance, transmission / hybrid drive / energy storage as the case may be) can't be overstated.
It's true that if you separate the power-generation from the vehicle-propulsion, you can design out some of the transient conditions and the costs associated with those, and you can downsize the engine to match it better to the load. For example, perhaps you could eliminate the fancy variable-vane turbocharger that the TDI uses to get good transient response, and substitute a fixed free-running turbocharger, no VNT no wastegate. Possibly the servo-controlled EGR could go back to an old fashioned vacuum operated one. You'll still need the (upcoming) common-rail injection equipment, though.
Regarding the above post, plug-in hybrid normally isn't regarded as viable for a transit bus application, which is what I gather the original poster is working on. You can't be plugging in a vehicle that's expected to be on the road for 16 hours a day. All-electric drive is interesting for Iceland (which has an abundance of geothermal power), but the question is how to do it on a practical scale for a city bus. The forklift solution is to change out the entire battery packs - but a battery pack for a transit bus that's big enough to give a viable range (100 km would give maybe 2 - 4 hours of operation?) would be something colossal in scale. Maybe there's a way to do it? I've yet to see that done.
GM has hybrid-powertrain buses in production - they are in use in Toronto (and many other places). Don't know how well they are doing in service.
Definitely avoid making the big mistake of assuming that one technology is universally applicable to everything, because it isn't. The statements that the envirofreaks seem to be making (that anything and everything that Detroit is doing is bad) is every bit as wrong as the statement that everything Detroit is doing is perfect.