Hydrogen is seen as an energy carrier of the future and significant research on hydrogen generation, storage and utilization is accomplished around the world. However, an appropriate intermediate step before wide hydrogen introduction will be blending conventional fuels such as natural gas, oil or diesel with hydrogen and follow up combustion through conventional means. Due to changes in the combustion and flame characteristics of the system additional research is needed to access the limits and the impact of the fuel mix on the combustion systems performance. The hybrid system consists of a 5 kW(el) electrolyzer and a residential 15 kW,h high efficiency gas fired furnace. The electrolyzer was integrated with the furnace gas supply and setup to replace 5-25% of the furnace natural gas flow with hydrogen. A mean for proper mixing of hydrogen with natural gas was provided and a control system for safe system operation was developed. Prior to the start of the field trial the hybrid system was investigated in laboratory environment. It was subjected to a variety of steady state and cycling conditions and a detailed performance and optimization analysis was performed with a range of hydrogen/natural gas mixtures. The optimized system was then installed at the Canadian Centre for Housing Technologies (CCHT) Experimental research house. The energy performance of the hybrid system was compared to the energy performance of an identical high efficiency furnace in the Control research house next door. (c) 2008 International Association for Hydrogen Energy. Published by Elsevier Ltd. All rights reserved.