Over the past several years, China, like many parts of the world, have been trying to develop alternative sources of fuel. At the top of the list is hydrogen-powered auto.

Until now, producing affordable hydrogen-powered vehicles has just been a dream of automakers.

A team from Shanghai's Horizon Fuel Cell Technologies have developed a small toy engine which they hope will help usher in a new generation of automobiles.

The toy's fuel cell, like those envisioned for real autos, relies on an electrochemical reaction to generate the current that powers the gadget's electric motor. Unlike a gas-powered internal combustion engine, the fuel cells's only byproducts are electricity, heat and water.

Other companies such as Canada's Ballard Power Systems are working on larger projects for fuel-cell demonstration programs for buses and other public transport.