High-temperature electrolysis is a method currently being investigated for the production of hydrogen from water, with oxygen as a by-product. High temperature electrolysis, also known as HTE or steam electrolysis, is more efficient than traditional room-temperature electrolysis, and has the added advantage of being powered by heat rather than electricity. Its applications will include nuclear reactors, specifically pebble bed reactors, which will be used in the future to produce hydrogen for cars through HTE of water. The efficiency of HTE for a nuclear reactor comes from the fact that the heat energy does not have to be converted to electricity (at about 20% efficiency) before electrolysing the water, but the heat energy is used to directly electrolyse water.

If a fusion reactor becomes an economical method of power generation, HTE will be used to efficiently convert the energy produced from a fusion reactor to hydrogen, which can be distributed to power vehicles and homes.