On October 7, 2001, at 1451 central daylight time (cdt), a Worner 1000 STU gas balloon, of German registry D-OAGH, piloted by a commercial pilot was substantially damaged during landing, when the hydrogen-filled envelope came in contact with a power line, caught fire, and burned. Visual meteorological conditions prevailed at the time of the accident. The balloon was a participant in a racing event associated with the annual Albuquerque Balloon Festival and was being operated under the provisions of 14 CFR Part 91 without a flight plan. The pilot and copilot reported no injuries. The balloon departed Albuquerque, New Mexico, on October 6, 2001, at 2000 mountain daylight time. The pilot said they were flying at 3,000 feet agl over the Liberal, Kansas, area when they experienced a microburst or something like it. The pilot said they suddenly found themselves heading for the ground at a very high rate of descent. The pilot said they dropped ballast to try and slow their descent. He said he then saw that his angle of descent was going to take the balloon into power lines along a road. The pilot said he opened the vent and put the basket on the road. The envelope went into the power lines, tore open, caught fire, and burned. The pilot said that the basket touched down on the road and moved maybe six inches before stopping. He said that the basket and support cables sustained no damage and are serviceable. He said that the envelope did sustain substantial damage from the fire. At 1456 cdt, the aviation routine weather report for Dodge City, Kansas, 60 miles northeast of the accident site, reported clear skies, 10 miles visibility, and winds of 180 degrees at 19 knots with gusts to 25 knots. The report also stated in the remarks that peak winds of 31 knots were recorded at 1600 cdt. An official from the Albuquerque Balloon Festival Gas Balloon Command Center said that the purpose of the gas balloon race was to takeoff and fly the farthest distance possible within a three day period. Race participants can reach altitudes up to 18,000 feet. The balloons are equipped with transponders, Global Positioning Satellite receivers and radios to communicate with air traffic control facilities. The balloons are also equipped with strobe lights for night operations. The official said that this was the 6th annual gas balloon race associated with the balloon festival. This year's race had 19 balloons participate. Each balloon flies with a crew of two. One person flies while the other person sleeps. He said it was the second year that they've had balloons that use hydrogen. Six of the balloon entries in the race used hydrogen. The official said that appropriate safeguards are employed when filling the balloons. He said that the reason more gas balloons are going to hydrogen is the cost. The official estimated that the cost to fill a gas balloon with hydrogen is 1/5 the cost to fill a balloon with helium gas.