Hitachi Energy plans to invest 479 million Canadian dollars ($337.7 million) to build a new, state-of-the-art transformer insulation factory in London, Ontario.

The facility will establish Canada's first electrical insulation pressboard and laminates manufacturing capability, which will bring production of a critical transformer insulation material closer to the North American market, the power technology and grid infrastructure company said Friday.

The 21,000-square-meter facility, scheduled for completion in 2028, will produce electrical insulation pressboard and laminates essential for power transformer operation.

Transformer insulation materials are vital to grid performance and reliability. Pressboard insulation allows for compact, safe transformer designs while providing electrical insulation and supporting internal cooling systems.

The project is backed by C$50 million in combined federal and provincial government support, including C$20 million from Ottawa's Strategic Response Fund, C$20 million from the Invest Ontario Fund, and C$10 million from Natural Resources Canada.

The investment comes amid surging electricity demand across Canada and the U.S. driven by artificial intelligence data centers, industrial electrification and grid modernization projects.

"Supporting that growth will require not only new generation and transmission infrastructure, but also the domestic industrial capacity and resilient supply chains needed to build it," the company said.

Hitachi Energy said that the London facility is part of its commitment to invest more than $2 billion to bolster the North American supply chain through 2027. The company noted that other recent investments in the country include the acquisition of London-based manufacturer of transformer insulation kits and components Canduct, and an investment to increase power transformer production in Varennes, Quebec.