Hitachi Energy will look at acquisitions and partnerships in India to foray into newer areas such as technologies for battery storage and other emerging areas in the energy space, said Claudio Facchin, CEO, Hitachi Energy.
In 2020, the Zurich-headquartered company acquired a majority stake in ABB Power Grids, creating a new business, Hitachi Energy India. In an interview, Facchin and the MD and CEO for Hitachi Energy, India and South Asia N. Venu said the company would also increase its investments in the country.
On Tuesday, it inaugurated a new facility of power quality products manufacturing in Doddaballapur, Bengaluru. In the interview, the top executives also spoke about the significance of India amid the push for net zero and importance of simple and clear regulatory frameworks. Edited excerpts:
What can we expect in terms of expansion in India?
Facchin: If you look at the Hitachi portfolio globally, 80% is already localized and available in India. That said, as per our strategy for 2030 we will expand our portfolio globally and therefore there is an opportunity, of course, to leverage India to expand the portfolio. Not only in terms of quantity but also scope, technologies, and India will play an essential role in that global growth. Not just because we have great talent here which is essential for us, but also because there is a good understanding in this market of what the different elements are and what needs to happen for this energy transition to be delivered. There are still areas where we will take some further steps with regard to the current portfolio to complete that remaining 20%. More importantly, looking a bit beyond the next 2-3 years is the question how do we set up so that our future portfolio will be broader in that sense for us to be able to support this energy transition for our customers to look at those areas. We have identified some of these high-growth areas where reliable, high quality power supply is needed and that’s where we can step in and support with our technology that reliability, resilience of those systems.
Are you planning to diversify your product portfolio?
Facchin: Yes. If you look at what we inaugurated recently in the power quality space, it is a pillar for technology. Some of that technology that we look at… flexible AV transmission systems, there were technologies which we introduced in the market along with HVDC and that whole area of power quality is becoming more and more relevant to manage this complexity, to make sure that the grid system is able to deliver the power quality but also reliably and efficiently. There is more on the power electronics space. Power electronics as a technology platform is becoming more and more relevant. You have power electronics in the renewable side for solar, for wind, you have more and more power electronics in the consumption side, EV charging, data centres, power electronics for power quality, HVDC and power electronics for storage applications. So, that’s an area we have an opportunity to expand and leverage. We don’t plan to go into battery manufacturing. That’s an important part of the future investments plans for India, but what we do is we want to invest more to have technologies and competence and capabilities that are best in class to integrate the battery storage systems into this new future energy system that will require that storage. We continue to look into those areas both organically, with our own research and development teams and inorganically as well. As some of the areas, we have the competence to develop them. We need to also look at either partnering or acquisitions that will help us accelerating and expanding the portfolio at the edge of the grid.
How do you see the Indian market in terms of regulations?
Venu: Coming to the utilities, in which both states and Centre are present, we see changes are happening at the state level. Now the government has announced a policy framework of revamped distribution sector scheme…so if you really look at couple of years back the government started with the APDP, Deendayal Upadhyaya scheme among others. All those schemes are very important and it has also helped needle to move on the distribution side, especially the distribution network has improved. It’s not there where you would like it to be but at least needle has moved there. So, we are definitely looking forward to see that in a big step, the distribution, the last mile connectivity.
