Revolutionizing Energy: The Establishment of Hitachi ABB Power Grids Ltd.

In recent years, global climate change and abnormal weather have become a serious issue that largely impacts our daily lives. Governments and organizations across the globe are tackling this issue by working toward realizing a “decarbonized society.” Deemed crucial to achieving such a society is the introduction of renewable energy, which involves solar, wind, and other sources of alternative power.

Moreover, the electrification of mobility, represented by electric vehicles (EV), and the expansion of data centers have resulted in increasing global power consumption. As the way we consume energy diversifies, a need for advanced technologies that is capable of controlling electrical power has also developed. “Power grid” technology is an essential component in the era of energy revolution.

Hitachi acquired the power grid business of ABB Ltd, a major heavy electric company in Switzerland, and established Hitachi ABB Power Grids Ltd., which began its operation on July 1.

Touching on the excitement surrounding the enterprise, the new company’s CEO, Claudio Facchin, says: "Both Hitachi and ABB are very passionate about technology, its people, and energy transition. Through our collaborative creation with global customers, we can contribute to revolutionizing energy."

Claudio Facchin, CEO of Hitachi ABB Power Grids Ltd.

Power Grid: The Key to Decarbonized Society

Due to growth in urbanization and power consumption, emissions of greenhouse gases including carbon dioxide have dramatically increased in recent years. This has been accompanied by such phenomenon as abnormal weather and rising sea levels, creating profound damage throughout the globe. This has led to a widespread and worldwide movement aimed at reducing greenhouse gasses that cause global warming, in other words, realizing a decarbonized society.

The introduction of “renewable energy” such as solar, wind, and geothermal power is particularly crucial for a decarbonized society. However, renewable energy relies much on volatile factors such as the weather, making it difficult to achieve a stable supply of such energy, and requiring the ability to predict energy demand and manage stored energy efficiently. Indispensable to this is the power transmission and distribution technology that helps stabilize energy supply, also known as “power grid”.

Now experiencing rapid progress in innovation, the power grid promises to serve as a technology that will support the widespread deployment of renewable energy and the realization of a decarbonized society.

Advantages of Hitachi ABB Power Grids Ltd.

Toshiaki Higashihara, president and CEO of Hitachi, Ltd., at the press conference on July 2, 2020

Against this backdrop, Hitachi announced in December 2018 the acquisition of the power grid business of Switzerland's major heavy electric company, ABB Ltd, starting a new joint venture “Hitachi ABB Power Grids Ltd." which began operations on July 1, 2020.

Fielding a workforce of about 36,000 employees in 90 countries around the world, Hitachi ABB Power Grids Ltd. produces many products with the highest market shares in the world, including grid automation, grid integration, high-voltage switching components, and transformers. According to the new company’s CEO Mr. Facchin: "Engineers, scientists, and sales team around the world are working side-by-side with our customers, and this network allows us to have a better understanding of the development of new technologies for key markets.

Sharing more than 100 years of history, Hitachi ABB Power Grids Ltd. has inherited both companies’ culture, traditions, and know-how. By combining the renowned power grid solutions of ABB with the digital technologies of Hitachi, Hitachi ABB Power Grids Ltd. is set to tackle the energy challenges faced by society.

At a press conference held on July 2, President and CEO of Hitachi Ltd. Toshiaki Higashihara said: "Hitachi and ABB have many things in common, not only in their histories but also their corporate cultures. I am confident that this will be the key to the growth of the new joint venture. Together, I would like to carry out Hitachi’s corporate mission : contributing to society with superior, original technology and products."

Aiming to Become a Global Leader in Addressing Energy Challenges

Expanding beyond the energy sector, Hitachi ABB Power Grids Ltd. is planning to supply solutions to various industrial fields. Combining them with Hitachi’s Lumada and other digital technologies, the company has set its sights on business expansion into fields other than energy, such as mobility, lifestyle, and industry.

As President and CEO Mr. Higashihara says: "With the COVID-19 crisis, the use of digital technologies is expanding at an accelerating rate, making electrical energy a lifeline that’s ever more important. I believe that the launch of this new company will bring about significant opportunities for Hitachi to be able to contribute to creating a sustainable society."

He adds that making use of the OT (Operational Technology) cultivated by both Hitachi and ABB and Hitachi’s strength of IT will, over the mid-to-long term, produce new digital solutions using 5G and AI (artificial intelligence).

CEO Mr. Facchin goes on to say: "Both Hitachi and ABB share a similar approach of collaborative creation with customers. We can certainly leverage the vision of Social Innovation that Hitachi has developed through the years, creating an environment and business models that allow us to collaborate and co-create with our customers. We would like to become a global leader in addressing energy challenges around the world.”

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