UC Irvine team identifies where renewable hydrogen delivers the greatest social benefit

• A new UC Irvine study uses monetized life-cycle analysis to compare hydrogen, direct electrification and fossil fuel pathways across heavy-duty transport and industrial sectors.
• The researchers concluded that renewable hydrogen applied in certain sectors offers greater social value, which includes reduced climate change impacts, cleaner air, improved public health and lower demand for natural resources.
• The researchers pinpointed steel, transoceanic shipping and long-haul trucking as the highest-value targets for clean hydrogen deployment.

Irvine, Calif., May 12, 2026 - Renewable electrolytic hydrogen produced by using electricity drawn from wind and solar sources delivers its greatest societal value when applied to steelmaking, transoceanic shipping and long-haul heavy-duty trucking, according to University of California, Irvine researchers.

Their findings, published recently in the journal Joule, quantify the social costs and benefits of clean energy transitions across major industrial and transportation sectors. They also provide policymakers and industry leaders with a data-driven framework to prioritize hydrogen investments for maximum public benefit. These social benefits include less climate damage, cleaner air and improved human health.

"Electrolytic hydrogen is a critical tool for decarbonizing sectors that are otherwise difficult to electrify directly, such as heavy industry and long-range freight transport," said Jeff Reed, senior fellow at the UC Irvine Clean Energy Institute who developed the research concept and led the study effort. "However, widespread adoption faces significant barriers, including high production costs, substantial energy requirements and limited supply."

Reed stressed that a key shortcoming of conventional cost analyses is that they typically overlook the broader societal value of switching from fossil fuels, including improved human health, reduced climate impacts, cleaner air and lower demand for natural resources.

To bridge this gap, researchers conducted a monetized life cycle analysis that translates environmental and health impacts into equivalent dollar costs. The study compared four pathways: renewable hydrogen, fossil fuel, direct electrification and battery energy storage system. These pathways were evaluated across eight major sectors: chemical production (methanol, ammonia, methane, and hydrogen), industrial heat, electricity generation, steel production, ocean-going vessels, heavy-duty trucks, rail and aviation.

The team found that steelmaking, transoceanic shipping and long-haul trucking yield the highest social value for hydrogen, often exceeding $5 to $8 per kilogram of H₂ by fully displacing coal, coke, marine fuel oil and diesel. In some cases, the researchers note, this societal benefit can offset the additional cost of switching from fossil fuels to hydrogen.

Lead author Robert Flores, senior scientist at the UC Irvine Clean Energy Institute, and his colleagues said fossil energy-derived hydrogen carries a low social value and is highly sensitive to leakage rates, whereas renewable electrolytic hydrogen retains a positive social value under all reasonable leakage scenarios.

Applications replacing natural gas, such as grid electricity generation and industrial heating, yield comparatively lower social values for hydrogen, given the relative efficiency of incumbent natural gas technologies. Hydrogen fuel cells deliver an 80 to 100 percent greater social value than internal combustion engines across most assessed applications.

"Renewable electrolytic hydrogen is a limited resource, and society cannot afford to deploy it indiscriminately," Flores said. "Our analysis shows clearly that hydrogen delivers the greatest societal return in the hardest-to-decarbonize sectors where the displacement of coal and heavy fuel oils generates enormous human health and climate benefits. In most other applications, direct electrification is the more efficient path forward."

Direct electrification may not be as applicable in industrial processes that require certain chemical inputs, such as hydrogen and ammonia in fertilizer production. Nor does it provide a complete solution when an extended vehicle range is needed or in a manufacturing setting where high temperatures or frequent power cycling are called for. Hydrogen and direct electrification function as complementary, sector-targeted decarbonization strategies, not competing alternatives, according to the team.

The study identified that the greatest social value arises when switching from fossil fuels is paired with great improvements in energy efficiency. For example, transitioning steel production from coal-and-coke-based blast furnaces to hydrogen-based direct reduced iron, replacing aging steam-turbines on ocean vessels with hydrogen solid oxide fuel cell systems, and transitioning Class 3 diesel trucks to fuel cell technology all generate the highest social value.

The researchers also examined the role of the electricity grid itself.

"When powered by wind and solar, most hydrogen and electrification pathways cut social costs - including worsening climate change, dirtier air and negatively impacted public health - by more than 90 percent compared to fossil fuels; that makes a clean grid the dominant and necessary condition," said co-author Mariam Al Moubasher, a graduate student researcher in the UC Irvine Department of Mechanical and Aerospace Engineering.

Under today's grid, there is very little social value for nearly all hydrogen applications studied; it applies only where hydrogen displaces the dirtiest fossil pathways, like coal in steelmaking. These results underscore a central message of the study: Without a comprehensively decarbonized electricity grid, neither hydrogen nor direct electrification can realize their full climate, health and environmental benefits.

The researchers caution that efficiency improvements alone are not enough to fully remove climate change-causing pollutants from our transportation, industrial and trade sectors. -Delaying the transition to hydrogen or electrification risks locking in fossil fuel combustion and its associated climate and human health damages for decades. Many equipment manufacturers are already developing hydrogen-ready technologies, and the researchers advocate for investment decisions that consider long-term decarbonization pathways to avoid stranded costs in transitional infrastructure.

"The societal outcomes we quantify - less climate damage, cleaner air and improved human health - are externalities that market prices simply do not reflect," said senior co-author Jack Brouwer, professor of mechanical and aerospace engineering and director of the Clean Energy Institute. "Because firms cannot capture these benefits on their balance sheets, policy intervention is essential to direct investment toward the applications where hydrogen truly pays off for society."

From a policy perspective, the UC Irvine team argues that monetized life-cycle analysis provides a transparent and evidence-based tool for targeting incentives. Rather than offering uniform support for hydrogen across all sectors, policymakers could design incentive structures similar to California's Low Carbon Fuel Standard that award larger credits to hydrogen applications with higher life-cycle social benefits. Complementary performance standards can simultaneously discourage the most damaging fossil technologies. Such an approach, the researchers noted, would direct public resources toward decarbonization measures that yield the greatest societal return.

The study received financial support from Plug Power Inc.

About the University of California, Irvine: Founded in 1965, UC Irvine is a member of the prestigious Association of American Universities and is ranked among the nation's top 10 public universities by U.S. News & World Report. The campus has produced five Nobel laureates and is known for its academic achievement, premier research, innovation and anteater mascot. Led by Chancellor Howard Gillman, UC Irvine has more than 36,000 students and offers 224 degree programs. It's located in one of the world's safest and most economically vibrant communities and is Orange County's second-largest employer, contributing $7 billion annually to the local economy and $8 billion statewide. For more on UC Irvine, visit www.uci.edu.

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