Hydrogen is the smallest atom we know making it difficult to contain.
Hydrogen has very low energy content meaning you need very high pressures (5,000 psi to 10,000 psi) to carry enough to get anywhere.  These pressures make refueling a challenge and a wreck overly exciting even excluding any explosion.
Hydrogen is very reactive so there is no source of uncombined hydrogen.  Tearing it off takes more energy than you get back.
Yes, you could use a "non-polluting" source such as windmills or solar to extract hydrogen but windmills are already getting backpressure from visual pollution and killing birds and its not clear that solar cells recover the energy required to make them during their productive lifetime.

I suspect that improved battery technology and nuclear power plants could provide most short range (less than 200 miles round trip) vehicle power.
Meanwhile the dream of hydrogen technology continues diverting us from really getting imported oil independence.

Terry Chamberlin wrote:
Making hydrogen from water takes a lot more energy
    
than you get out of using the hydrogen.<

Then take a look at this:

http://email.gmcanada.com/corpdb/cachq/pressrel.nsf/0/f31c06740fddd3a585256bd0006e9496?OpenDocument

http://www.businessweek.com/magazine/content/03_43/b3855073.htm

http://www.wired.com/wired/archive/10.08/fuelcellcars.html

http://liberty.hypermart.net/editorials/Hydrogen_Car.htm



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