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The End of the Oil Age
geekstreak quotes "'The Stone Age did not end for lack of stone, and the Oil Age will end long before the world runs out of oil.' Ways to break the tyranny of oil are coming into view. Governments need to promote them."
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You are quite correct. The "Hydrogen Economy" buzzword-crap refers to the idea of using hydrogen as an energy distribution mechanism, like a battery. You "charge up" your hydrogen tank by using electricity to split H out of H2O, and the electricity has to come from somewhere. You are also correct that it will come from whatever's cheapest, and only the environmental nuts with rooftop PV panels will make hydrogen cleanly.
However-- that's not the point. At least not initially. The idea is to transition to an infrastructure that does not depend on any particular generation method. This opens the way for your car to be powered by anything-- not just gasoline. Once you can put hydrogen in, you're no longer tied to a single source. As more efficient generators and methods (nuclear, solar, excercise-club treadmills) come into play, your existing car will be able to immediately take advantage of them.
To sum up, you're right. It will still be gasoline and coal on the backend for a long while. But every time a more efficient nuke plant pops up, cars can instantly switch their power source by just sourcing hydrogen from somewhere else. Contrast that to our existing infrastructure, where to take advantage of a more efficient generation method or fuel source, you need a new car for each technology advance (say, hybrid vehicles or VW diesels) or non-gasoline-compatible fuel.
It's just a way to disconnect generation from distribution and usage, and it works a hell of a lot better than a stack of Li-ion batteries that weighs as much as your car.