Last week, I was part of a group of journalists who were the first to drive the production-ready BMW Hydrogen 7 car in Berlin. The dual-fuel car, which can switch between gasoline and hydrogen combustion at the press of a button, is indisputably a remarkable engineering achievement. And yes, it mainly emits water vapor. If only things were that simple; if only hydrogen were actually practical as a fuel.

BMW has been producing hydrogen-combustion prototype cars for several years. The company is also working on hydrogen fuel cells for electric-drive cars, but it found it couldn’t get the same engine power that’s possible when the hydrogen is combusted. (“You get a car, but it’s not a BMW,” sniffs Thomas Melcher, head of power-train engineering for BMW.)

Now, BMW is touting a version that has gone through rigorous product-development steps and could, in theory, be mass-produced. In practice, however, the company will make only 100 of the cars and begin renting them out next year to carefully selected and as-yet-unnamed people in a massive global publicity drive.

BMW calls it “eco-luxury”: a car that it claims is environmentally friendly but has lots of horsepower and all the trimmings. BMW frames the effort as a noble, pioneering push for hydrogen-technology adoption. It also happens to double as a “green” marketing effort in a time of growing concern about global warming driven by fossil-fuel burning.

Cruising down the A-10 autobahn at 200 kilometers per hour, I pressed a button on the dashboard, which switched the car from gasoline to hydrogen. The only thing I noticed was the sound: the engine moved to a higher-pitched whine. A red “H2” symbol glowed. Without any hiccup, the car was now burning hydrogen in the same cylinders that, a moment before, had burned gasoline. But the massive 12-cylinder, 6-liter engine only produces 260 horsepower when burning hydrogen. So the BMW engineers scaled back the gasoline-combustion performance to give the two fuels comparable performance. (Normally, the 12-cylinder produces some 400 horsepower with gasoline.)

Still, the company has gone further than any other in regulating the combustion of hydrogen. Just three years ago, the engine would run for several minutes and then break down with a big bang, says Melcher. “Boom. We love explosions!” he laughs. It turned out that a little bit of hydrogen was leaking past the pistons, mixing with oil, and exploding. That problem was solved by modifying the piston rings to prevent leakage. Engine control systems also had to be modified to deal with the far faster combustion of hydrogen–it burns 100 times faster than gasoline–and to regulate it in such a way as to keep emissions of combustion byproducts like nitrogen oxides to trace levels.

Driving the car was fun–but mostly because it was from the BMW 7 series. The fact that it was burning hydrogen was unremarkable, from a driving point of view. What was in the trunk was far more interesting: removing a felt panel revealed a shiny, steel hydrogen-storage tank, which was about the size of a full-size beer keg and ate up half the trunk space.

This tank confounded the BMW engineers more than anything else. They wanted very badly to show that hydrogen can be the next gasoline–just another liquid you can put in the tank. But hydrogen wants to be a gas. To make it a liquid, you need to chill it to a frosty -253 °C. Keeping it that cold in an automobile tank for any period of time is extremely difficult.

In fact, no one has fully solved the problem yet. What BMW did was design a double-walled stainless-steel tank weighing 129 kilograms. Between the two steel layers are a vacuum and multiple layers of insulation designed to reflect the heat. BMW boasts that if you put a snowball in the tank, it would not melt for 13 years. Unfortunately, put liquid hydrogen in the tank and it will start “boiling” in a matter of hours.

As the hydrogen becomes gaseous, pressure rises inside the tank. At a certain point, a pressure-relief valve opens. A little bit of hydrogen gas vents out (about 10 to 12 grams per hour), goes through a catalytic converter to turn it into water, and exits the car through a special pipe in the rear bumper. If you aren’t driving the car, it takes only 17 hours before this venting starts. A half-full tank will almost completely “boil off” in nine days.

If the tank is somehow damaged and the “boil off” happens much more quickly, a second valve opens and raw hydrogen is piped to a port in the roof. Since these hydrogen escape processes are still in development and raise potential safety concerns, BMW insists that users not park the car in an enclosed garage. The company is working on next-generation tanks using lighter materials while keeping an eye on the materials-science field for possible new storage methods, such as storing hydrogen in nano-engineered materials.

Still, it was fun to park at a Total gas station outside Berlin–one of a few demonstration hydrogen-car filling stations in Europe, with several others scattered around the world–and fill the sleek machine with liquid hydrogen. A fill-up takes about eight minutes. The retail price was 8 Euros (about $10.60) for a kilogram of hydrogen, which has the approximate energy content of one gallon of gasoline.

Klaus Draeger, a BMW research manager, suggests that hydrogen today is where gasoline was 100 years ago. A century ago, he says, “who could imagine that there would be a world-embracing network of filling stations? Only a few visionaries would imagine that happening.” Many of the BMW engineers hovering over the journalists noted that radical infrastructure changes are not a major challenge. And they’re probably right. I’ve seen pictures showing what Berlin looked like 60 years ago. It’s hard not to agree that infrastructure can be completely rebuilt in a matter of decades.

But only if it makes sense to do so. In this case, the infrastructure isn’t the largest issue. Hydrogen is the largest issue. You can’t just dig it out of the ground and burn it. You have to either extract it from hydrocarbon fuels, which defeats the clean-energy purpose, or extract it from water molecules by applying electricity–which means you are either burning the fossil fuel back at the power plant or taking away much-needed renewable electricity from the power grid.

When you extract hydrogen from fossil fuels, you actually end up emitting more carbon dioxide. In fact, driving a car whose hydrogen was extracted from natural gas results in roughly double the carbon-dioxide emissions produced by driving a car that simply burns the natural gas directly. For fossil-fuel extraction of hydrogen to ever make sense from an environmental perspective, the separated carbon dioxide would have to be sequestered underground.

And if you use electricity to split water, you’ll need to make sure the electricity doesn’t itself come from fossil fuels. The electricity would have to come from a renewable source, like wind or the sun. It’s not clear that hydrogen production is the wisest use for renewable energy, except marginally: it can absorb electricity on very windy or very sunny days, when renewable power plants are producing excess supply.

BMW maintains that once we have breakthroughs in renewable supply and hydrogen storage, cars based on Hydrogen 7 technology can fill every driveway–and perhaps even every garage. I want the company to be right. The idea of a high-performance car that essentially emits only water vapor is very alluring. But for now, the Hydrogen 7 appears to be a remarkable engineering achievement for a future that may never arrive.