The Malaysian government has recently announced to increase the share of renewable energy generation from 2% to 20% of the total electricity consumption by year 2030. However, integrating a significant level of renewable energy sources on the distribution network without proper coordination will cause adverse effects that leads to unnecessary operation costs to the stakeholders. Various solutions including energy storage system are proven to be an effective way to overcome the issues caused by the integration of renewable energy sources. However, energy storage system using batteries have limitations such as limited life cycle and environmental hazards. As such, alternative source such as fuel cell which is well known for its zero pollutant can be considered. In this paper, a distributed static synchronous compensator integrated with a hydrogen system (DSTATCOM-Fuel cell) is proposed. The hydrogen system consists of fuel cell and electrolyzer to perform power exchange within the grid for regulating the voltage magnitude at 1 p.u. Various case studies have been conducted to validate the efficacy of this proposed combination and the results have shown that the DSTATCOM-Fuel cell can effectively mitigates the voltage rise up to 12.3% while maintaining high penetration of the photovoltaic systems.