One of the biggest hurdles for cars powered by hydrogen is generating sufficient supplies of hydrogen in an environmentally friendly manner.

Toyota is working with a company known as FuelCell Energy to demonstrate that hydrogen can be generated sustainably and, according to the automaker, virtually free of air pollutants.

The two companies last week announced the completion of a so-called Tri-Gen plant at California's Port of Long Beach, where Toyota is demonstrating the potential for hydrogen in the trucking industry by using a fleet of fuel cell-powered semi-trailers trucks to transport goods between the port and Los Angeles.

The scalable plant uses renewable biogas sourced from agriculture to generate hydrogen, along with electricity and water. In the standard setup, methane from the biogas is turned into hydrogen using steam-methane reforming, with the required heat and water for the reforming process coming from byproducts of the plant.

The resulting hydrogen can then be used directly as a power source or converted into electricity in a fuel cell, a process that creates the heat and water byproducts used by the plant.

According to Toyota, the pilot plant produces up to 2,645 pounds of hydrogen per day, along with 2.3 megawatt-hours of electricity, and 1,400 gallons of water. According to the automaker, that's enough to power 2,350 average-size homes and meet the daily driving needs of nearly 1,500 fuel cell vehicles.

Some of the excess electricity will be pumped back into the grid while the excess water will be used for the car wash facilities that clean cars that come into the port prior to customer delivery.

While many automakers go all in on battery-electric cars, Toyota remains reluctant to take a one-size-fits-all approach to its products and as a result is investigating alternative solutions for meeting carbon neutrality goals. Some of these solutions include carbon-neutral synthetic fuels, fuel cells, and even engines that burn hydrogen. Toyota has said it sees hydrogen as just as promising as EVs in the fight against carbon emissions, especially for the transport industry.