It can be both, actually. Hydrogen is just the storage mechanism. You can use PEM electrolysis to break water in oxygen and hydrogen. Then you can use that hydrogen in a fuel cell, which produces electricity and water. It's terribly inefficient, but it does work, and may be attractive if you have a source of cheap renewable electricity (like home solar panels).Because that's not how fuel cells work. Water is not the fuel. It is a product of the reaction along with electricity.
Presumably that's what he was referring to when he said that. Distilled water + a PEM electrolysis machine would allow you to refill the cartridges at home, which you then take with you when you travel.