Hitachi Energy to play key role in country's grid modernization

China has emerged as the linchpin of a $9 billion global investment surge by Hitachi Energy, as the world's largest transformer manufacturer hitches its growth to the country's world-leading ultrahigh voltage expansion and an exponential explosion in artificial intelligence-driven power demand.

The Zurich-based company, which reported record-high order backlogs in 2025, is aggressively expanding its footprint across Chinese industrial hubs, including Xi'an, Shaanxi province; Xiamen, Fujian province; and Chongqing, to capitalize on a domestic market that is outpacing the rest of the world in grid modernization.

"China, with world-class UHV capabilities and robust local manufacturing, is in a peak period of power grid investment, and this high-intensity commitment to UHV technology will continue," said Zhao Yongzhan, Hitachi Energy's executive vice-president and China head.

UHV transmission lines refer to power transmission cables operating at voltages exceeding 800 kilovolts of direct current or 1,000 kV of alternating current.

This is in accordance with the surge of total grid investment in China in recent years, which was expected to hit record levels in 2025, led by State Grid Corporation of China and China Southern Power Grid.

According to the International Energy Agency, the surge in power demand is being fueled by a "perfect storm" of AI data center construction and the integration of large-scale renewable energy.

Global data center electricity consumption is expected to more than double by 2030, with China's domestic power demand projected to grow at a compound annual rate of 8 to 9 percent through the end of the decade as AI infrastructure matures, the IEA said.

"The current wave of AI investment is stimulating global energy demand at an exponential rate," said Zhao, adding that the complexity of connecting volatile renewables requires a level of grid resilience far beyond previous standards.

To meet this demand, Hitachi Energy is significantly boosting capacity at its Xi'an manufacturing base, a facility that supports the world's first UHV flexible direct current transmission project.

Zhao said that Hitachi Energy focuses on creating infrastructure synergy by linking remote renewable megabases in western China to high-demand eastern load centers, while simultaneously deepening local manufacturing to bolster supply chain resilience for both Chinese and global energy systems.

Industry experts believe that UHV technology will serve as the critical "super-highway" system that makes it possible to reconcile the massive geographical gap between its western energy bases and eastern demand centers.

By scaling up transmission capacity by 2030, UHV corridors will act as the primary conduit for China's vast wind and solar resources, particularly those located in the remote Gobi Desert and other desert regions, experts said.

Ye Xiaoning, a senior engineer at the new energy department of the State Grid Energy Research Institute, said that China's continuous commitment to grid modernization and transmission expansion has fundamentally enhanced the country's ability to balance and optimize renewable energy assets on a national scale.

The recommendations for formulating the 15th Five-Year Plan (2026-30) outlined a strategic shift toward a new power system in China with a higher proportion of renewable energy, and key priorities such as advancing a diversified energy portfolio and optimizing the balance between local energy uptake and long-distance transmission.

These measures are designed to promote the high-quality growth of clean energy while strengthening the power system's overall reliability, flexibility and cross-regional mutual support capabilities.

Hitachi Energy is further cementing its technological leadership by advancing "green" and digitalized power hardware tailored for China's 15th Five-Year Plan period, ensuring the grid can handle the dual challenges of high-capacity transmission and carbon neutrality, Zhao said.