I'm not partial to diesel, either. I don't know about fuel cells but electric buses work well all over the world.

These ones don't even need overhead wires:
http://www.tecnobus.it/home/en/prodotti.html

BRT done right can incorporate dual powered (hybrid) buses that run on electricity from catenary where it works but transition off or around it with battery power, charged by an engine of some type. The efficiencies on that would be phenomenal.