A new system is proposed for the treatment of waste aluminium. The total exergy loss (EXL) in the system for the co-production of 1 kg of hydrogen at 30 MPa and 26 kg of aluminium hydroxide is evaluated from the viewpoint of life cycle assessment (LCA) by comparison with the EXLs in conventional systems, The exergy flow diagram reveals that the exergy of waste aluminium, which contains only 15 mass% metal, is still large, while that of pure aluminium hydroxide is relatively small. Therefore, the EXL in the proposed system (150.9 MJ) is 55% less than that in the conventional system (337.7 MJ) in which the gas compressor and production of aluminium hydroxide consume significantly more exergy. The results also indicate that exergy analysis should be applied to the LCA as a critical measure for practical use, in addition to the conventional LCA of carbon dioxide emission. (C) 2008 International Association for Hydrogen Energy. Published by Elsevier Ltd. All rights reserved.