Photo: Hitachi Energy
Hitachi Energy has broken ground on a major expansion of its South Boston, Virginia, campus that will become the largest power transformer factory in the US – one of the most in-demand pieces of equipment for the country’s aging, overloaded electric grid.
The $457 million project will create around 825 new jobs in Halifax County and nearly double the site’s workforce. Hitachi Energy already employs about 850 people at the campus, where it has manufactured transformers since 1968.
The new facility will produce large power transformers used for high-voltage transmission, power generation, industrial facilities, and data centers. The expansion is part of Hitachi Energy’s previously announced investment of more than $1 billion to expand US grid equipment manufacturing.
Demand for power transformers has surged as utilities race to upgrade the grid to connect new renewable energy projects, electrification, and AI data centers. Transformer shortages have become one of the biggest bottlenecks slowing new power projects across the US.
That pressure is only expected to grow. A new ICF report projects that total US electricity demand will rise by 21% by 2030 and 39% by 2035, while peak demand is forecast to increase by 14% and 25%, respectively. The fastest growth is expected in regions with the largest expansions in data centers, industrial development, and electrification.
At present, ERCOT (Texas) and PJM (13 states and DC), the US’s fastest-growing electricity markets, have no excess generating capacity available to reliably support additional demand growth, says the ICF.
The report also projects that around 445 gigawatts of new generating capacity will be added between 2026 and 2030, but only 68 GW is expected to come online in 2026, and not all of that new capacity will be available when demand peaks. In other words, the challenge isn’t just generating more electricity – it’s building enough transmission lines, transformers, and other grid infrastructure quickly enough to deliver it where it’s needed.
Virginia sits at the center of that demand. The state is home to the world’s largest concentration of data centers, with Northern Virginia handling an estimated 70% of global internet traffic. Data centers already account for roughly a quarter of Dominion Energy Virginia’s electricity sales, and the utility expects electricity demand to nearly double over the next 15 years, driven largely by continued data center growth.
Hitachi Energy says the South Boston expansion will help meet growing demand from utilities, power generators, data centers, and industrial customers nationwide while strengthening the domestic supply chain for critical grid equipment.
The new power transformer factory builds on nearly six decades of manufacturing in Southside Virginia and represents a major piece of Hitachi Energy’s broader US manufacturing strategy. A significant portion of the company’s more than $1 billion US investment is being made in Virginia, reinforcing the state’s growing role in supplying equipment needed to modernize the nation’s electric grid.
Read more: Hitachi Energy invests a further $4.5B to expand the electricity grid
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