Hitachi Energy is investing $1.5 billion to ramp up transformer production to support electrification efforts worldwide.

Transformers enable efficient transmission and distribution of electricity. They’re a crucial component for integrating renewables, grid interconnections, electrifying transportation, and decarbonizing energy systems.

Hitachi Energy’s latest investment will gradually expand its global transformer capacity by 2027. The $1.5 billion is in addition to the $3 billion the company announced in October 2023 for transformer manufacturing.

Today, the Zurich-headquartered company also announced an investment of around $180 million in a new 30,000-square-meter (322,917-square-foot) transformer factory in the Vaasa region, Finland. It will come online in 2027. 

I asked Hitachi Energy about its US expansion plans, and Steve McKinney, senior VP & head of Hitachi Energy’s transformer business in North America, said:

The investments announced today are part of an overall effort to strengthen and optimize our manufacturing footprint, both globally and within North America.

Hitachi Energy’s transformer facility expansions include the ongoing project in South Boston, Virginia, and other recently completed projects at Jefferson City, Missouri, and Bland, Virginia, among others, and additional projects in the region will be announced soon.

Hitachi Energy is the world’s largest transformer manufacturer in terms of installed base, portfolio range, manufacturing capacity, and market coverage, with over 60 transformer factories and service centers globally.

Based on the transformer data collected, the US National Renewable Energy Laboratory estimates distribution transformer capacity may need to increase 160–260% by 2050 compared to 2021 levels to meet residential, commercial, industrial, and transportation energy demands.

Aging transformers and electrification primarily drive the increase in demand.

Read more: Penske and Hitachi just launched a big electric truck charging pilot

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