Economic analysis of solar-hydrogen energy industry in China: A PLS-SEM approach to financial performance and input-output dynamics

This research analyses the input-output dynamics of the solar-hydrogen energy industry (SHEI) in China, investigating the relationship between production and consumption to promote green energy alternatives. The study used Partial Least Squares Structural Equation Modeling (PLS-SEM) to examine financial data from 2011 to 2019, evaluating the influence of variables such as fixed assets, operational expenses, and R&D investment on SHEI output metrics, including earnings per share and net profit margin. The results reveal significant correlations between inputs and outputs (coefficient = 0.86, p < 0.001), with state-owned enterprises showing higher financial input capabilities (SHEII1 = 2.80 vs. 2.48, p < 0.001) but lower performance outcomes (SHEIP1 = 9.24 vs. 26.68, p < 0.001) compared to private enterprises. Geographical disparities were identified, with stronger input-output relationships in non-BSGS regions (coefficient = 0.86 vs. 0.46, p < 0.001). The research delineates the roles of company age, total assets, and intangible assets as mediators, while ownership structures and equity concentration serve as moderators, affecting the correlation between input and output. The novelty of this study lies in its comprehensive quantitative assessment of SHEI financial dynamics using structural equation modeling, providing empirical evidence of the effects of corporate characteristics on performance outcomes in China's emerging hydrogen economy. This study offers a theoretical and practical framework for governments, companies, and academics aiming to incorporate solar-hydrogen technology into global urban energy systems, facilitating initiatives to enhance sustainability and decarbonization.