Hitachi Energy is stepping up its investment to meet the increasingly acute shortage of transformers with over $250 million more by 2027. The development follows the firm's recent unveiling of a record-high $6 billion investment in all its operations around the world in response to rocketing transformer demand in the midst of accelerating electrification demands.
As sectors such as data centers and artificial intelligence fuel record-breaking electricity demand, transformer demand has jumped over initial forecasts. To fulfill the augmented demand, Hitachi Energy is boosting production and enhancing supply chains both in the United States and the world over.
The additional investment will raise production capacity at Hitachi Energy's transformer plants in Virginia, Missouri, and Mississippi. It also involves producing essential transformer components, such as bushings and insulation, that are exported to other producers. It is projected to mitigate the current shortage of transformers, increase supply chain stability, and increase the overall production capacity. Outside the U.S., the investment program also supports Hitachi Energy's manufacturing presence in Asia, South America, and Europe. The global effort is part of the company's multi-billion-dollar effort to increase manufacturing, engineering, digital strength, research and development, and strategic partnerships. These initiatives are set to address increasing customer needs and support the long-term objectives of decarbonization and electrification.
A specific emphasis of such a focus of investments is upgrading supply chain management, digitalization, and automation—enabling the company to expand its production capacity and speed up delivery. This additional $250 million commitment follows the $6 billion investment in 2024, including the $1.5 billion it allocated solely for expanding global transformer production.
Hitachi Energy is also focusing on sustainability in its expansion. All of its new manufacturing investments will be equipped with state-of-the-art, environmentally friendly technologies to enhance operational efficiency with high levels of safety and quality. It is on a mission to achieve carbon-neutral operations by 2030 and make positive economic and social contributions to the local communities where it has its operations. Through this aggressive expansion plan, Hitachi Energy is placing itself in the perfect position to respond to the critical transformer supply problem and drive the global transition toward a cleaner, more electrified world.