Global sustainable energy giant Hitachi Energy today announced that it will spend more than $37 million to expand and upgrade its power transformer factory in South Boston, Virginia. This is in response to soaring demand for power transformers from utility companies that are scrambling to accommodate the renewable energy boom after the Biden administration passed the Inflation Reduction Act in August.
Hitachi Energy’s South Boston factory manufactures both distribution and power transformers for the US power grid, commercial buildings, and industrial facilities, as well as traction transformers for railway applications use.
Power transformers are static machines used for transforming power from one circuit to another without changing the frequency. They adjust and stabilize the voltage of electricity to ensure an efficient, reliable power supply.
Distribution transformers provide the final voltage transformation in the power distribution system, stepping down the voltage used in the distribution lines to the level used by the customer.
Hitachi Energy will add 26,000 square feet of production space in the factory’s power transformer building to support the manufacturing of larger transformers specifically designed for utility and renewable energy markets.
The South Boston factory, which has been in operation since 1968, is currently around 607,000 square feet in size. Around 450 employees work there, and Hitachi Energy says it’s now actively recruiting more people.
Steve McKinney, senior VP and head of Hitachi Energy’s transformer business in North America, said:
Demand for transformers is growing rapidly and we are continuing to invest in our local footprint here in North America to keep pace.
The company says it will also invest in automated equipment and changes in factory processes to reduce factory cycle times and improve operational performance. Hitachi notes that the process changes are “particularly critical in the face of current supply chain challenges brought on by the pandemic and other factors.”
Hitachi Energy is also leveraging financial support from the Commonwealth of Virginia and Halifax County, where the South Boston factory is located.
This is why we need good policy, people. The Inflation Reduction Act passed, and the private sector is hopping to it as a result of federal incentives and demand. This means that the long-overdue US grid upgrade is finally kicking off.
That makes ramping up the manufacturing of power transformers sexy in my book, because energy resilience is non-negotiable in the face of geopolitical challenges and climate change.
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