That's an old Triumph Terrier (150 cc engine, circa 1955 or so). Lovely bike with a lovely name!
And yes, this is where a lot of commuters are going to be riding to work soon -- small-bored motorcycles that sip gasoline and/or that plug in. The Piaggio, which makes Vespa, is already selling a 3-wheeled hybrid motorcycle that gets 170 mpg (picture below) and a plug in motorcycle will be available towards the end of this year.
And, of course, there is the next year's Toyota Prius' which (if US News and World Report is to be believed) will get better than 90 mpg. I would note that the current Prius gets about 45 mpg in the real world, so if the next generation Prius gets even 60 mpg, it will be a big break through. The new version of the Prius (which has not been updated since 2004) will be lauched at the January 2009 Detroit auto show and will be available on lots in April of next year.
What's next: A how-to-distill-grass-clippings manual tied to low-power ethanol-sipping hybrid motorcycle. I think that combination is only 3-4 years away. Very back to the future!..Very