NOVELTY - Generating (M1) hydrogen from a bio-oil involves hydrogenating a water-soluble fraction of the bio-oil with hydrogen in presence of hydrogenation catalyst; and reforming the water-soluble fraction by aqueous-phase reforming in the presence of a reforming catalyst. The hydrogen is generated by the reforming, and the amount of hydrogen generated is greater than that consumed by the hydrogenating.    USE - For production of hydrogen, liquid fuels, hydrocarbons and chemical fractions from bio-oil (claimed).    ADVANTAGE - The method is efficient for the production of fuels, including hydrogen and hydrocarbons, derived from bio-oils. The hydrogenating water-soluble fraction of bio-oil prior to aqueous-phase reforming (APR) results in minimal or no undesired side-product formation, prolongs the active lifetime of the reforming catalyst, and provides greater hydrogen yield for the APR reaction compared with reforming of the non-hydrogenated water-soluble fraction of bio-oil. The hydrotreatment of the lignin fraction provides higher alkanes, which predominate over phenolic species. The hydrogen selectivity of the hydrocracking reaction is greater than or equal to 60 (preferably greater than or equal to 65, especially greater than or equal to 68).    DETAILED DESCRIPTION - INDEPENDENT CLAIMS are included for the following:    (1) forming hydrogen and liquid fuel from bio-oil involving extracting bio-oil with water to form a water-soluble fraction and a lignin fraction; hydrogenating the water-soluble fraction with hydrogen in the presence of a hydrogenation catalyst; reforming the water-soluble fraction by aqueous-phase reforming (APR) in the presence of a reforming catalyst; and hydrocracking the lignin fraction with hydrogen in the presence of a hydrocracking catalyst, where hydrogen is generated by the reforming, and the amount of hydrogen generated is greater than that consumed by the hydrogenating and hydrocracking, and liquid fuel is generated by the hydrocracking;    (2) generating liquid fuel from bio-oil involving hydrocracking a water-insoluble lignin fraction of bio-oil with hydrogen in the presence of a hydrocracking catalyst;    (3) generating 5-25C alkanes from bio-oil involving hydrotreating a water-insoluble lignin fraction of bio-oil with hydrogen in the presence of a hydrotreating catalyst, where 5-25C alkanes are generated by the hydrotreating;    (4) generating a chemical fraction from a bio-oil involving hydrogenating the water soluble fraction in a first hydrogenation in the presence of a first hydrogenation catalyst to form a first hydrogenated product; hydrogenating at least a portion of the first hydrogenated product in the presence of a second hydrogenation catalyst to form a second hydrogenated product; and reforming a portion of the first hydrogenation product by aqueous-phase reforming in the presence of a reforming catalyst, where hydrogen is generated by the reforming, at least a portion of the hydrogen generated by reforming is used the first hydrogenation, the second hydrogenation, or both the first and second hydrogenations, and the chemical fraction comprises alcohols, diols, polyols and/or furan derivatives; and    (5) forming (M2) hydrocarbons from bio-oil involving extracting bio-oil with water to obtain a water-soluble fraction and a lignin fraction; hydrogenating the water-soluble fraction with hydrogen in the presence of a hydrogenation catalyst; reforming a portion of the water-soluble fraction by aqueous-phase reforming (APR) in the presence of a reforming catalyst; optionally reacting, in the presence of an aldol condensation catalyst, a portion of hydrogenated water soluble fraction prepared by hydrogenating the water-soluble fraction of the bio-oil; and reacting, in the presence of hydrocracking catalyst, a portion of hydrogenated water soluble fraction prepared by hydrogenating the water-soluble fraction of the bio-oil, where hydrogen is generated by the reforming, and at least a portion of the hydrogen generated by the reforming is used in the hydrogenating, the reacting in the presence of hydrocracking catalyst, or both the hydrogenating and the reacting in the presence of hydrocracking catalyst, and where hydrocarbons are generated by the reacting in the presence of the hydrocracking catalyst, and when reacting in the presence of an aldol condensation is carried out, hydrocarbons comprising 5-9C alkanes are generated, or when reacting in the presence of an aldol condensation is not carried out, hydrocarbons comprising 1-6C alkanes are generated.