Mitsubishi Electric Corporation and Mitsubishi Heavy Industries, Ltd. announced that the two companies have reached a basic agreement to establish a joint venture to integrate their businesses in fields focused on power generator systems.

It is expected that Mitsubishi Electric will be the majority shareholder and Mitsubishi Heavy Industries will be the minority shareholder of the new company.

Climate change caused by global warming has emerged as a common issue worldwide, and efforts to achieve carbon-neutrality, which would reduce greenhouse gas emissions to net zero, are accelerating around the world.

Electricity demand is expected to increase due to economic growth mainly in emerging countries and awareness of energy security, and energy transitions has increased. In the future, existing thermal power generation will decarbonize its systems with fuel conversion to hydrogen, ammonia, and other carbon-free fuels.

See related article: Exxon, Japan’s Mitsubishi Heavy Tie-Up in Carbon Capture Technology

Large-scale power plants that have supported the power infrastructure so far will play an important role as a force to adjust for the increase in variable renewable energy sources, whose power generation is affected by weather and other factors.

Considering this market environment, Mitsubishi Electric and Mitsubishi Heavy Industries have reached this basic agreement to strengthen their market competitiveness further by integrating their respective businesses and combining their respective technologies and assets. This business integration will create a stronger partnership than ever before and expand the two companies’ power generator systems on a global scale, thereby contributing to the realization of a carbon-neutral society.

ESG News Editorial Team

The ESG News Editorial Team is comprised of veteran financial journalists and sustainability analysts dedicated to providing real-time, objective reporting on global ESG regulations, climate finance, and corporate governance. Our desk monitors daily developments from the SEC, IFRS, CSRD and international regulatory bodies to ensure our 1M+ readers receive accurate, data-driven insights into the evolving sustainable investment landscape. Follow the ESG News Editorial Team for expert reporting on global sustainability standards, ESG disclosures, and climate policy. Access over 10,000 investigative reports and real-time updates.