Fuel Cells  

A fuel cell is simply a battery  (or electrochemical conversion device) which produces electric energy and heat  by continuously consuming a fuel or reactant from an external source. The fuel cell consists of two electrodes on either side of  an electrolyte membrane. Hydrogen, the fuel, is supplied to an  electrode ( the anode )  where a catalyst helps to strip the Hydrogen atom of it's electron which in turn travels through an external circuit that can be converted into electric power. The Hydrogen proton migrates  through the electrolyte membrane to the cathode side, where it combines with  Oxygen molecules and the electrons  from the external circuit  to produce water.
Durability improvement and cost reduction are the two most significant challenges to fuel cell commercialization. With a goal of $35 per killowat , on-going research is focussed towards reducing material and production costs  and improving water, air and temperature management of fuel cell systems . The department of Energy reported in 2008 that fuel cell costs in volume production are at $ 73 per kilowatt, which is significantly down from 2002, where a typical fuel cell cost $1000 per kilowatt.