Hitachi Ltd. and two Mitsubishi group companies have agreed in principle to begin studying ways to integrate their hydroelectric power operations under a joint venture to be formed next year, the three companies said Monday.
The move is aimed at maximizing their hydroelectric power generation business amid growing demand for clean sources of renewable energy in emerging economies, they said.
Hitachi, Mitsubishi Heavy Industries Ltd. and Mitsubishi Electric Corp. aim to get the new company up and running by Oct. 1, 2011.
The three companies said they are pooling their technologies and resources to better compete against Chinese and European rivals in the wake of anticipated strong demand for hydroelectric power in places such as China, India and Latin America.
Hitachi will hold a 50 percent stake in the new company and the rest will be held by the two Mitsubishi firms.
While domestic demand will remain intact in terms of maintaining and upgrading existing facilities, construction of new plants for hydroelectric power generation in Japan is on the decline, the companies said.
Under their partnership, the companies aim to unify their hydroelectric power generation business in terms of domestic and global sales, marketing, engineering, development and design of key hydropower products such as water turbines, water turbine generators and control systems, they said.