Hydrogen is the most abundant element in the universe, so its appeal to the fossil fuel-addicted auto industry is obvious. But while most car companies think they’ll be able to sell hydrogen fuel cell cars to eco-minded consumers, they are ignoring a glaring opportunity: that hydrogen-powered cars could be the perfect fuel for our self-driving, on-demand future.

This week, Honda introduced two new versions of the Clarity: a plug-in hybrid version with an all-electric range of 40 miles, and a battery-powered version, the range of which is undisclosed. Honda says it has close to 100 hydrogen-powered vehicles on the road in California today — the only state in the US with anything approaching a hydrogen fueling infrastructure. The automaker hopes to eventually sell “thousands” of fuel cell vehicles over the next four years.

And Honda isn’t alone. Hyundai and its sister company Kia both have to plans to introduce fuel cell vehicles in the next three years. Toyota has its Mirai class of fuel cell cars on sale today. GM and Honda recently announced a joint venture where the two automakers hope to produce a next-generation fuel cell system by 2020, while BMW is engaged in a hydrogen R&D partnership with Toyota.

Hoping to buy a fuel cell vehicle outside the Golden State? Fat chance

Hydrogen fuel cells — which use compressed hydrogen as their fuel and release only water vapor — have been in development for decades. But only recently have they attained performance and range numbers good enough to replace an average driver's gasoline-powered car. So why aren’t we seeing the same enthusiasm among fans of zero-emissions driving for cars like the Clarity as we are for any of Tesla’s battery-powered electric vehicles?

The main reason is that the hydrogen-fueling infrastructure is practically nonexistent. Despite the technology having been in development for decades, there are only a little more than two dozen fueling stations in California, mostly clustered around Los Angeles and the Bay Area.

Then there’s the increasing competition from battery-powered electric cars. As the cost of batteries drop, some carmakers see fuel cell vehicles as increasingly uncompetitive. Recently, Daimler CEO Dieter Zetsche said that hydrogen fuel cells are no longer a major part of the automaker’s plans for the future. Instead, the Mercedes-Benz parent company said it would be doubling down on electric technology. His comments are already being interpreted as a signal that Daimler will be winding down its participation in a 2013 agreement with Ford and Renault-Nissan to jointly develop fuel cell technology.

Zetsche was much more diplomatic about hydrogen than Tesla CEO Elon Musk, who has derided the technology as “incredibly dumb,” “extremely silly,” “mind-bogglingly stupid,” and most succinctly, “bullshit.”

Driving the 2017 Honda Clarity Honda gave me the opportunity to drive the 2017 Clarity earlier this week so I could experience a hydrogen fuel cell vehicle firsthand. My first observation was how quiet the car drove. Much like a Tesla or any other battery-powered electric vehicle, the Clarity was a ghost on four wheels, only emitting a soft whine when I would jam the throttle. Driving down the narrow, pothole-ridden streets of Manhattan’s Upper East Side, the Clarity handled itself smoothly. A digital display behind the steering column showed a fully fueled hydrogen tank, easing my dread about running out of power in a city without any refueling stations. And a small blue ball in the center of the screen would grow or shrink, depending on how much electricity was being generated by the car’s fuel cells. A heads-up display projected onto the lower left-hand corner of the windshield showed the vehicle’s speed, while an 8-inch touchscreen on the center console offered a range of typical features (navigation, Bluetooth connectivity, etc). Below the screen, a panel of buttons for the car’s main functions — park, drive, reverse, neutral — extended out and down like a bridge to connect with the armrest and cupholders. As for the drive itself, it was brief and enjoyable. Press the oddly named “Sport” button, and you get enhanced regenerative braking, though not as much as Tesla or BMW. The feel of the vehicle’s interior, with its ultrasuede and faux wood paneling made of recycled material, was both luxurious and eco-friendly. The Honda Clarity offers an EPA-estimated range of 366 miles — the longest range of any zero-emission vehicle. The vehicle is only available for lease, with pricing starting at $369 per month. There’s a $15,000 fueling allowance from Honda and a $5,000 tax incentive from California. It’s almost enough to make you forget that refueling this car will be a huge pain in the ass.

“Hydrogen is an energy storage mechanism. It is not a source of energy. So you have to get that hydrogen from somewhere,” Musk said in 2015. “If you get that hydrogen from water, so you’re splitting H20, electrolysis is extremely inefficient as an energy process…. If you took a solar panel and use the energy from that to just charge a battery pack directly, compared to trying to split water, take the hydrogen, dump the oxygen, compress the hydrogen to an extremely high pressure (or liquefy it), and then put it in a car and run a fuel cell, it is about half the efficiency. It’s terrible. Why would you do that? It makes no sense.”

Honda has a much different perspective, obviously. Stephen Ellis, director of fuel cell vehicle marketing for the carmaker’s American division, said that hydrogen’s appeal is its ability to “mimic” the habits of fueling and operating a gas-powered vehicle: a 3- to 5-minute refueling time and a range of up to 366 miles. “This is a continuum,” Ellis said. “We should have multiple choices, fuel cell being one of them.”

In response to the criticism that hydrogen is too inefficient and energy intensive to produce, Ellis explained that Honda “wouldn’t be doing this if there was no environmental value.” Most hydrogen in the US is produced via a process called steam-methane reforming, in which steam is heated up to a temperature of 1,000 degrees Celsius to produce hydrogen from a methane source such as natural gas. But that isn’t the only method available.

“Some will say, ‘When you make it from natural gas, it still emits carbon,’” Ellis said. “Yes, but what we’re looking at is well-to-wheel... [Unlike oil], hydrogen will always be regionally or locally sourced. You can make it from water using zero-carbon electrons — solar, wind, hydroelectric. You can make it from natural gas. You can make it from biomethane.”

But the near-term problem of a lack of fueling locations represents the most significant obstacle to widespread adoption of this technology. Honda and other fuel cell vehicle makers are watching closely to see if any other states get inspired by California’s example and begin building out their hydrogen fueling capacity.

The Northeast, and especially New York and Massachusetts, are seen as the next frontier for fuel cell vehicles. New York governor Andrew Cuomo included in the state’s most recent budget $55 million in rebates of up to $2,000 for New York state residents who purchase zero-emission vehicles. Fuel cell advocates are pushing for $15 million of that initiative be put toward funding a hydrogen fueling infrastructure.

Experts predict that we may see more commercial vehicles, like trucks and forklifts, using hydrogen than mass-market cars. That’s because hydrogen can hardly compete with cheap gas and rapidly improving electric-powered technology to appeal to a mass audience. “For hydrogen to compete with either fuel source would require a substantial reduction in the cost of fuel cell technology along with the build out of a comprehensive hydrogen fueling network,” said Karl Brauer, executive publisher of Kelley Blue Book. “Neither scenario appears likely in the next 10 years, if ever.”

In fact, the most logical application of hydrogen is going to be almost completely ignored by major automakers: hydrogen-powered autonomous vehicle fleets operating in high-density, geofenced urban areas. Studies have shown that the charging time required for a battery-electric vehicle in an urban mobility setting, like ride-sharing or car-sharing, will significantly eat into utilization, especially if it has to use Level 2 charging (Level 1 being a standard home outlet).

While Level 3 DC “fast charging,” as represented by Tesla’s Superchargers, would improve this, it would also degrade the batteries and cause infrastructure concerns. Moreover, the space required to park these charging electric vehicles would also negate one of the prime advantages of autonomous on-demand mobility — that it could free up parking spaces for housing development or parkland. Hydrogen-powered, self-driving vehicles could address many of these barriers.

“A city would only need a handful of hydrogen stations to support the fleet [of self-driving cars].”

“A city would only need a handful of hydrogen stations to support the fleet, with vehicles getting in and out within a few minutes and going right back into service,” said Sam Abuelsamid, senior research analyst at Navigant Research. “This would give the zero-emissions advantage while minimizing downtime.”

Steve Center, vice president of Honda’s connected and environmental business development office, said the Clarity could be easily retrofitted into an autonomous vehicle, with its millimeter-wave radar embedded in the lower grille. “You add a couple more sensing devices and LIDAR and things like that,” Center said. “You tie them together and you turn them on.”

This is not to say that the Clarity is a self-driving car — far from it, in fact. Honda trails most major automakers in its pursuit of autonomous technology. A recent report by Navigant placed the Japanese company in 15th place out of a total of 18 companies. Honda unveiled its NeuV concept car at CES earlier this year: a tiny, two-seater designed for automated driving and ride-sharing. And even though it was a concept, and technically could embody any vision of the future that Honda desired, the NeuV was a battery-electric vehicle. Hydrogen, it appeared, was too far-fetched for this concept.