OREANDA-NEWS. Hitachi, Ltd. and ABB, the leading power and automation group, today signed a formal contract to establish a joint venture company for high-voltage direct current (HVDC) transmission in Japan. Closure of the transaction is subject to customary regulatory approvals with the intention of establishing the joint venture in August.

Hitachi will own 51% of the joint venture and ABB will own 49%.The new joint venture will be based in Tokyo and will provide ABB's latest technology to HVDC projects on which Hitachi is the prime contractor, taking full responsibility for all aspects of direct current (DC) systems from design to engineering and equipment supply as well as after-sales service. The intention is to contribute to wide-area electric power distribution networks in Japan by combining Hitachi's sales network, project management know-how, and quality assurance processes with leading-edge HVDC technology and system integration capability from ABB.

This strategic partnership between the two companies will contribute to the evolution of Japan's power network. Hitachi and ABB will explore further strengthening of the relationship and address opportunities to widen the scope for future collaboration.

HVDC is a technology used mainly for transmitting electricity between two grid systems. The supply side power is converted from alternating current (AC) to direct current (DC) before being transmitted, and it is then converted back to AC in the receiving side system for use. The system is ideal for long-distance transmissions due to its ability to minimize electricity losses and to its lower space requirements and construction costs. It is also well suited for interconnections between two grids different frequencies.

Driven by factors such as the growing installation of renewable energy and reforms to the electric power system, use of HVDC transmission in Japan is expected to be increasingly deployed for applications such as grid connections for offshore wind power integration and regional interconnections in the transmission grid. In particular, it is anticipated that greater use will be made of VSC-HVDC, which is already widely used in global markets, in response to the difficulties associated with the use of the LCC-HVDC that has predominated in Japan to date, and includes controlling reactive power or starting up an AC system when no power supply is available on the grid.

Hitachi developed LCC-HVDC in 1970 and has participated in the HVDC projects at all six sites where the technology has been installed in Japan, with a total installed capacity that exceeds 2,800 MW. It has achieved world-class levels of utilization through ongoing technology development and by supplying engineering and systems that satisfy the high levels of reliability, operating performance, and quality demanded by Japanese power companies.

ABB pioneered HVDC technology, putting into operation the world's first commercial link in Sweden in 1954, and was the first to introduce VSC technology (HVDC Light) in the 1990s. The company also holds many other world records in this technology. Over the years ABB has been awarded around 100 HVDC projects representing a total installed capacity of more than 120,000 MW, accounting for about half of the global installed base. ABB's HVDC Light solution leads the way in VSC technology; the company has delivered 15 of the 19 VSC links that have been commissioned worldwide. The new joint venture will help ensure the security of supply of high quality electric power in Japan by taking maximum advantage of the strengths of both companies.