A release from Stanford University has some facts about hydrogen generation and use:
Hydrogen

I noticed some of the google blurbs on hydrogen fuel were ten years old. Progress is being made. Santa Fe, NM, is one smaller city already embarked of fitting some of its trucks with hydrogen capability. Some Swedish buses run on hydrogen. BMW hopes to have hydrogen fuel sources in Germany in 2010. Some Mercedes-BMW vehicles being tested are hybrids.

Hydrogen, as a fuel, combines with oxygen to produce water and heat, thus no harmful emissions.

Elsewhere, I read that costs of the fuel will be high, but when considered as a percentage of vehicle cost, is manageable.