Dongwu Securities: AI pushes the United States into the ultra-high voltage era; domestic private power equipment leaders are expected to benefit fully from overseas expansion

Bloomberg News has learned that Dongwu Securities released a research report stating that the American power grid is becoming more decentralized and regionalized in regulation. The interconnection support among the three major regional grids is limited, and nationwide power dispatching is difficult, leading to the saying “water far away cannot quench the near thirst.” It is expected that North America will enter an accelerated investment phase in the next 5-10 years, with this round of grid expansion investments projected to exceed $75 billion, and additional plans continuing to be added. Overseas transformer prices are rising, with delivery times for large transformers generally extended to over three years. Leading Chinese private power equipment companies, leveraging complete industry chains and product quality, are entering the North American high-end market through AIDC user demand, becoming a breakthrough point for domestic companies going global.

Dongwu Securities’ main points are as follows:

AI Computing Power Explosion Coupled with Aging Power Grids, Leading to a “Rigid Expansion” of US Power Supply and Demand

The rapid development of AI in North America has caused load demands to grow rapidly. In 2024, the installed capacity for power generation is expected to reach about 1,200 GW, increasing to 1,751 GW by 2030, requiring an additional approximately 550 GW. Meanwhile, the US power grid is in a state of “overdue service,” with surging loads colliding with aging infrastructure, creating enormous pressure for upgrades and new construction. CSPs are rushing to connect gas turbines for faster grid integration, and the explosive demand combined with slow supply release will pose unprecedented challenges to the US power system.

AIDC “High Voltage + Self-Power” Evolution Creates a “Multiplier Effect” in Transformer Demand

As AIDC installed capacity approaches gigawatt levels, the connection voltage is evolving from traditional 10kV to 138kV and even 230kV. To reduce impacts on the grid and other users, self-power solutions are becoming mainstream. Compared to direct grid connection, gas turbines, photovoltaics, and energy storage involve voltage boosting stages, significantly multiplying transformer demand. It is estimated that by 2030, North American AIDC transformer capacity could reach 350 GVA, with a CAGR of about 46% from 2026 to 2030, and a market size exceeding 60 billion yuan. The installed capacity for high and medium voltage transformers is projected at 163 GVA and 186 GVA respectively, with CAGR of approximately 56% and 40%, indicating huge demand potential.

Dispersed US Power Grid Structure and Insufficient Capacity, AI Forcing US into Ultra-High Voltage Era

The US power grid is highly decentralized and regionalized, with limited interconnection support among the three major regional grids. Nationwide power dispatching is difficult, leading to the saying “water far away cannot quench the near thirst.” Regional grids such as MISO, PJM, and ERCOT face serious stability issues, pushing the US to accelerate the construction of 765kV ultra-high voltage backbone networks. It is expected that North America will enter an investment acceleration phase in the next 5-10 years, with this round of grid expansion investments projected to exceed $75 billion, and new plans continuously added.

Chinese Power Equipment Companies Leverage “Delivery Time + Capacity” Advantages to Successfully Enter North American High-End Supply Chain

Overseas transformer prices are rising, with delivery times for large transformers generally extending beyond three years. Leading Chinese private power equipment companies, with complete industry chains and high product quality, are entering the North American high-end market through AIDC user demand, becoming a breakthrough point for domestic companies going global. Currently, companies like Siyuan, Jinpan, Igor, and Baiyun Electric have achieved order breakthroughs or capacity layouts in the North American AIDC market. Insulator companies such as Shena Power and Dalian Electric Porcelain, through cooperation with overseas power equipment firms, are expected to break into North American ultra-high voltage projects. The combination of self-built AIDC and ultra-high voltage construction will open a new chapter for Chinese power equipment exports.

Investment Recommendations:

With North American AIDC self-supply power and ultra-high voltage projects starting, leading domestic private power equipment companies are expected to benefit fully.

In transformers, focus on: Siyuan Electric (002028.SZ), Jinpan Technology (688676.SH), Igor (002922.SZ). Also consider: TBEA (600089.SH), Baiyun Electric (603861.SH), Wangbian Electric (603191.SH). For power generation equipment, focus on: Dongfang Electric (600875.SH), Sungrow (300274.SZ). Also watch: Turbine Technology (300277.SZ), Harbin Electric (01133). For North American ultra-high voltage, consider: Shena Power (603530.SH), Dalian Electric Porcelain (002606.SZ).

Risk Warnings:

Risks include escalating US-China trade policies and geopolitical tensions, slower-than-expected progress in US grid and AIDC construction, increased international competition, and rising raw material prices.