The demand for AI computing power is soaring, and the order visibility of the four heavy electronics companies will reach 2031

AI computing power is soaring, making "electricity" the next key battlefield in the AI ​​industry. Taipower's strong power grid, semiconductor factory expansion and AIDC (AI data center) demand are fermenting simultaneously, driving the demand for transformers, GIS (gas insulated switches) and power distribution equipment. The order visibility of the four major heavy power companies Huacheng, Shidian, ZTE and Yali have already been seen in 2029 and 2030.

This wave of demand is different from the simple replacement of old power grids with new ones in the past. AI data centers have high-density power consumption characteristics. In addition to requiring a large amount of power, they also require stable power supply, further increasing the scale of power equipment. A recent statement from Shidian pointed out that domestic power-level transformer orders mostly fall at 161kV, but the demand for AIDC has emerged in large specifications such as 230 to 345kV, 150 to 200MVA, and the products are obviously developing towards "high voltage and large capacity".

Shidian said that the domestic market is still heavy on electricity, and Taipower's strong grid continues to promote. In addition to the expansion of technology industries such as AIDC, wafer fabs, packaging and memory, the technology industry-related revenue accounts for about 25%, and Taipower's strong grid-related revenue also accounts for about 25%. The overall orders on hand have exceeded 60 billion yuan, and the delivery time of international transformer products has remained 2 to 3 years, indicating that supply and demand are still relatively tight.

In response to demand, after the T3 plant was put into operation in September last year, the capacity utilization rate has reached nearly 90%, and customers have already made reservations for production capacity. The next step is to invest about 2.2 billion yuan. The T4 plant plan will be launched in the near future. It will develop high-voltage and large-capacity products such as 345kV and 200MVA. It is expected to be put into production in September next year. It will begin to contribute revenue in 2028 and fully reflect the production capacity benefits in 2029.

Huacheng has benefited from Taipower's strong power grid, export infrastructure, semiconductor factory expansion and AIDC. Among them, AIDC has received orders of more than 22 billion yuan and has also begun to accept orders for 2030. ZTE has benefited from the construction of Taipower's power grid and the expansion of semiconductor factories. The demand for power equipment such as GIS has been steady, and some orders have visibility as far as 2031. Alexei currently has orders on hand of more than 13 billion yuan, and is optimistic about the outlook for this year and next.

There have been concerns about AI bubbles in the past, but heavy electrician industry players believe that the popularity of AIDC is not a short-term theme, and demand will still be supported for at least the next five years. If AI models continue to upgrade and computing power demand expands, demand for power equipment will remain strong in the next 5 to 10 years, further turning into long-term infrastructure demand.