Mitsui, a massive Japanese conglomerate, will invest US$12 million in an ambitious smart grid project that is being constructed in New Mexico.
The Tokyo-based company, which is one of the largest in the world, currently has no smart grid business of its own, but views the investment in the Tres Amigas Superstation as its entry into the industry.
"Through this investment we want to gain knowledge in this field, then use it develop this business in locations like Japan, Europe and China," a spokesman said on Wednesday.
For giant Mitsui, which has offices in 68 countries and last fiscal year generated US$60 billion in revenues, the investment is not a large one financially. But it shows that smart grid technology, which aims to efficiently allocate power generated from different sources across vast regions, is gradually becoming mainstream.
The Tres Amigas project will be a giant electricity hub located in Clovis, New Mexico, that will interconnect the three main power grids in the U.S., enabling electricity to be allocated between them. The company says it will act as a broker for renewable energy, allowing utilities to buy and sell even between the different power grids.
Construction on the project is set to begin next year on a 22-square-mile site, with initial commercial operations planned for 2014.
Mitsui would not comment on what its total stake of Tres Amigas will be, but the Nikkei financial newspaper estimated it would come to around 20 percent. The company may increase its investment as the project matures, the company spokesman said.
Smart grid technology is a focus in Japan after a massive earthquake and resulting tsunami in March caused meltdowns at a key nuclear power plant and massive blackouts. Supply has since stabilized, but parts of the country including Tokyo are still closely monitoring daily power consumption and utilities are asking that customers to limit their use of power.