Something like the Volt would be the next step. Indeed, some Prius owners today are jamming more batteries into their cars to achieve a similar result. Whole big aftermarket in it.

Hydrogen would be ideal as its only pollutant is water (drinkable water, even). But as you’ve pointed out, it takes whole bunch of energy to crack water into hydrogen and oxygen with electrolysis. So we need a way to produce a monster amount of electricity. Wind is good, solar is good, tidal and wave is good. But we need a baseload solution too, more than hydro-electric can provide. I’ve been saying it for years: humankind needs to harness the power of the stars. We need nuclear fusion. There’s enough deuterium in the ocean to power the planet for 150 billion years. We’ve figured out how to build bombs with it, now it is time to make it do something useful.

Hydrogen power uses tremendous amounts of electricity and I don’t think that’s an environmental savings unless you can produce current solely through renewable energy. Ethanol and biodeisel cars are not a great idea because they take agricultural production away from producing food in countries that need food.

Consumer demand will eventually dictate that car companies get moving on this – I hate the use of “green” for marketing purposes but even if being “green” is only trendy now it’s still a step in the right direction.