Hitachi Energy Ramps up Investments to Sustain Grit

Hitachi Energy will invest an additional US$4.5 billion in manufacturing, engineering, digital, R&D, and partnerships by 2027. Most importantly, this will double the investments done in the last three years.

Moreover, the new funding will also complement the recently announced US$1.5 billion investment in April this year to ramp up global transformer production. These investments will enable the company to meet customers’ commitments and market demand, increasing its global R&D, engineering, and manufacturing capacity of transformers, high-voltage direct current (HVDC), and high-voltage products. It will also support the deployment of power electronics-based solutions, grid automation, and software solutions, and services in line with the Hitachi Energy 2030 Plan.

High-Voltage Direct Current (HVDC) power transformer testing area in one of Hitachi Energy’s facilities in Europe (File Photo/Image Credit: Hitachi Energy)

Furthermore, investments will also go into partnerships, supply chain, digitalization, and automation. These are enablers to support capacity expansion and increase speed to market.

Propels Manufacturing Capacities

Electrification is pivotal to achieving Net-Zero goals. Thus, energy transition requires

innovative software solutions and services and a significant increase in the production of critical technologies for an expanded electricity grid. Integrating more renewable energy sources like solar and wind, alongside meeting the electrification demands of transport, buildings, industry, and other sectors, necessitates a secure and flexible grid infrastructure.

According to IEA, the increased usage of Gen AI and the ever-growing quantity of digital data requires an expansion of data centers. Moreover, with the global electricity demand from data centers and AI could double towards 2026.

The company also announced today that it is investing around US$330 million to expand and modernize its flagship factory in Ludvika and a new campus in Vasteras, Sweden, across all product portfolios.

The Ludvika factory, with over 120 years of innovation, manufactures transformers, high-voltage products and HVDC systems. Therefore, the investment will expand the factory by more than 30,000 square meters. This will especially enable new manufacturing capacity of large transformers to meet the deliveries of key HVDC projects.

A new campus in Vasteras will accommodate 1,800 employees, including an R&D center and a state-of-the-art production facility for grid automation. The workforce in Sweden will additionally grow by 2,000 to support the accelerating energy transition.

Unprecedented Level of Investments

According to the IEA Report in October 2023: The recent clean energy progress we have seen in many countries is unprecedented and cause for optimism. However, this could be jeopardized if governments and businesses do not come together. That is, to ensure the world’s electricity grids are ready for the new global energy economy that is rapidly emerging.

“Electricity will be the backbone of the entire energy system and the change is happening faster than many thought possible. New business models, harmonization of designs, along with partnerships are key drivers for the increase in the pace of change,” said Claudio Facchin, CEO, Hitachi Energy.

In addition, Facchin said, “The world is in a race to transform energy systems. Technology is not the bottleneck and electrification is creating unprecedented demand for power grids systems combined with digital solutions and services. As the market leader, we are responding with an unprecedented level of investment, people and innovation to meet that demand.”

11 June 2024