Taiwan's heavy electrical sector benefits from local and overseas demand

台灣重電產業受惠於本地和海外需求。

TAIPEI (Taiwan News) — Taiwan’s leading heavy electrical equipment companies are seeing strong demand both domestically and abroad, driven by artificial intelligence data center expansion and efforts to strengthen the country’s power grid, CTEE reported Monday.

AI data centers consume roughly six times more electricity than standard facilities, fueling demand for transformers, distribution boards, and other heavy electrical equipment. At home, Taiwan Power Co. is investing in a long-term initiative to enhance grid stability.

Four major suppliers — Shihlin Electric and Engineering, Chung-Hsin Electric and Machinery, Allis Electric, and Fortune Electric — all reported record cumulative revenues in the first ten months of the year.

These companies are pursuing overseas opportunities, particularly in the US, where aging power infrastructure needs upgrades. Allis has supplied equipment for TSMC’s Arizona fabrication plant and UMC’s new Singapore facility.

Both Allis and Chung-Hsin are preparing for orders from TSMC’s planned second US fab. Fortune became the first Taiwanese heavy electrical firm to join the supply chain for the Stargate Project in Texas, a large-scale AI infrastructure initiative, with NT$2 billion (US$64 million) in orders expected for delivery from late this year into next year.

Domestically, Taipower’s grid resilience project has created a steady pipeline of orders, some extending through 2032. Company executives say these long-term contracts provide predictable revenue and profit potential for the next three to five years, and potentially beyond if the upgrades accelerate.

Taiwan’s electricity network was historically centralized, with major transmission lines concentrated in the north, central, and southern hubs. While effective for meeting growing electricity needs, this model increases the risk of large-scale outages, according to Taipower.

Taipower’s NT$564.5 billion investment aims to strengthen defenses, improve distribution, and enhance overall grid reliability across ten strategic areas.