Hitachi Energy to build $479M pressboard plant in London

Hitachi Energy will build a $479-million factory in London, Ont., to make the pressboard insulation that goes inside high-voltage transformers, with $30 million from Ottawa, the federal government said Oct. 16.

Industry Minister Mélanie Joly announced the funding in London, according to a release from Innovation, Science and Economic Development Canada. The money is split between $20 million from the Strategic Response Fund and $10 million from the Investments in Forest Industry Transformation program, which backs new uses for wood fibre. The total project cost is $478.8 million, so Ottawa’s share is about 6 per cent.

The plant would be Canada’s first electrical-grade pressboard manufacturing facility, according to the government. Hitachi Energy said in its own announcement that the 21,000-square-metre site is expected to be finished by 2028 and will also be the company’s first pressboard line in the Americas. It is expected to produce up to 20,000 tonnes a year of pressboard and laminated insulation, using wood fibre as the main input.

The company said the plant will create more than 100 permanent skilled jobs in London. The federal release said Hitachi Energy Canada, which has about 1,250 employees now, expects to grow its Canadian workforce to 1,765.

The output is meant for Hitachi Energy’s transformer plant in Varennes, Que., and for other North American and global transformer makers, according to the government. Hitachi Energy said a separate $270-million expansion in Varennes would nearly triple its large power transformer capacity. It also said it has bought London-based Canduct, which makes transformer insulation kits and components, and did not disclose a price.

Hitachi Energy said manufacturers face global supply limits, including limited availability of specialized insulation materials, while Canadian electricity demand grows with industrial projects, data centres and electrification. Neither release gave figures on transformer shortages or on how much pressboard Canada now imports.

“Canada is strengthening its electricity system to build a more connected, reliable and efficient grid,” Joly said in the release. Energy Minister Tim Hodgson said the project “demonstrates that there are high-value opportunities for forest products in critical, energy infrastructure.”

Carla Vicente, Hitachi Energy’s country managing director for Canada, called the announcement “a significant step forward for Canadian manufacturing and our country’s energy future.”

The company said the Ontario government is contributing up to $20 million through the Invest Ontario Fund, and that Natural Resources Canada is providing $10 million. The federal release lists the $10 million under the forest industry program and quotes Ontario Economic Development Minister Vic Fedeli as a partner, but it does not state the provincial amount. If both figures are correct, public money would cover roughly 10 per cent of the project.

The releases also do not say whether the federal contribution is a grant or must be repaid. That matters because the Strategic Response Fund has been used for loans. Our earlier reporting found that Xanadu’s $195-million quantum deal with Ottawa is a loan, not a grant. The terms of the Hitachi Energy agreement were not available.

Demand on the grid is the backdrop. Ottawa is weighing a $1.5-billion to $1.8-billion data centre for the Communications Security Establishment, and this week it put $100 million toward Nova Scotia offshore wind. Our earlier piece on OpenAI’s interest in Canadian data centres as grid space runs out covers the pressure on power supply. Every new line and substation needs transformers, and the insulation inside them is one of the parts Canada has not made at home.

Questions that remain include where the wood fibre will come from, when production will start and what the funding terms are. Neither Hitachi Energy nor the government gave a production start date.

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Sources: Innovation, Science and Economic Development Canada (Oct. 16, 2026); Hitachi Energy (Oct. 16, 2026). CBC News also reported the $479-million investment. Provincial and Natural Resources Canada amounts are as stated by the company.

Via Innovation, Science and Economic Development Canada and Hitachi Energy.