A new Silicon Valley startup is aiming to produce an all-electric commercial airliner capable of flying 150 passengers from London to Paris within the next 10 years.

Called Wright Electric, the company believes removing jet fuel from the equation will dramatically lower the cost of aviation, and that the current rate of improvement of batteries and electric motors means all short-haul flights could be electric by 2037.

Before the end of the next decade Wright Electric says it will have produced a 150-seater electric plane with a range of around 300 miles. Short-haul flights like this make up 30% of all commercial airline flights and represent a $26bn (£20bn) market. The startup, which is yet to have started development of its plane, will go up against aviation giants like Airbus, which is currently working on an electric aircraft of its own.

A two-seat electric Airbus called the E-Fan has been in development since 2014, and the company has now started to develop a short-haul electric plane with space for around 80 passengers.

Wright Electric gave the first glimpse of its plans at a demonstration day hosted by Y Combinator, the most high-profile startup accelerator in Silicon Valley, on 21 March. Startups nurtured by Y Combinator include holiday home company AirBnB and file storage company Dropbox.

But the year-old company's plans rely on battery technology improving at a constant rate for the next decade, otherwise power and capacity limitations will hinder development of the plane. Wright Electric knows this and has a contingency plan; if battery tech isn't up to scratch, it will switch to a hybrid system powered by both electricity and jet fuel. The hybrid plan will happen if battery technology doesn't get "dramatically better" in the next decade, the company says.

Despite these plans sounding far-fetched for now, especially from such a young company, Wright Electric has attracted attention from low-cost, short-haul airlines. "EasyJet has had discussions with Wright Electric and is actively providing an airline operator's perspective on the development of this exciting technology," the airline told the BBC.

Interest in the plane is also coming from the private sector, with Wright Electric claiming a "high-net-worth individual" wants to buy an electric 150-seater from the startup to sit alongside his four other private jets.

Wright Electric plans for its planes to have modular battery packs which can be quickly removed and replaced. This negates the need to park a plane for several hours while batteries are being recharged. The company also claims its planes could be much quieter than conventional aircraft.