When the folks at GM laid out their aggressive development plan for the Chevrolet Volt a bit more than three years ago, the decision was made to go with an off-the-shelf, inexpensive and volume-produced engine.
The 1.4 liter engine they settled on was already being produced by GM; a turbocharged version of it is used in the Chevy Cruze. Although the engine is small and relatively efficient, it by no means was the best choice to maximize fuel economy. Likely the choice of engine was governed more by the aggressive timeline and lack of capital to engineer a new engine specifically for the requirements of a range extender.
Even now, hints are starting to come in that the Volt's fuel economy after the battery is depleted will be less than stellar (sub-30 mpg, anyone?). And so, now that the initial launch is soon upon them, GM has begun the process of reevaluating the Volt's engine setup and thinking about which engines might best work in the Volt.
Tony Posawatz, the Volt Line Director at GM, admits that they didn't initially spend a lot of resources on the extended-range feature of the first generation Volt, but says, "You can bet that we are already looking at advanced projects on what an extended-range feature should operate like in the belief that this propulsion system will resonate with customers. That may be a Stirling cycle engine, perhaps it’s a Wankel, a gas turbine, a small displacement motorcycle engine– you can extend the possibilities to a lot of different alternatives.”
A Stirling-powered Volt... that would be interesting.
Source: GM-Volt.com

I'm more interested in finding information on when the BEV version of the volt will come out then what kind of engine will be in gen2 EREV. There have been many GM employees that have hinted and even come right out and said there would be a BEV volt (Shad Balch and even Bob Lutz himself) the question is when. I'd love to see battery specs and projected release dates, hopefully we won't have to wait too long.
Here's a Car and Driver article about it:
http://blog.caranddriver.com/pure-ev-chevrolet-volt-in-the-works-accordi...