ABB to supply HVDC system to NordBalt

Global power solutions provider ABB Limited has secured a $580 million contract to deliver high-voltage direct current HVDC transmission equipment for SwedLit Interconnect, also called NordBalt, which is a joint agreement between Lithuanian grid operator LITGRID Turtas AB and Swedish power transmission provider Svenska Kraftnät.

The SwedLit Interconnect project, which has received funding from the European Union EU, is likely to begin operations in 2015.

The contract will include the engineering, design and installation of two 700-megawatt MW transmission networks and two 300-kilovolt kV substations. The substations will be in Klaipeda, Lithuania, and Nyborg, Sweden. In addition to land cables, ABB will supply two units of 400-kilometer undersea cables that will connect Lithuania and Sweden. Sources indicate that the equipment will help easily integrate SwedLit Interconnect to the planned pan-European grid. ABB will supply its patented HVDC Light Cables, which have polymeric insulation, to reduce electricity transmission losses over long distances. The cables have been designed specifically for direct current transmission.

In 2006, Lithuania's largest power producer, Lietuvos Energija AB, and Svenska Kraftnät commenced feasibility studies to build the SwedLit Interconnect. In July 2009, a memorandum of understanding was signed to begin construction. This month, LITGRID Turtas, which was established as Lithuania's new national power grid operator, took over the project from Lietuvos Energija. The SwedLit Interconnect aims to increase electricity sharing between the Nordic and Baltic regions and reduce their energy dependence on Russia.

In 2006, ABB supplied HVDC sub-sea cables and other transmission equipment for the EstLink Interconnect, which links Estonia and Finland. This power link is jointly operated by Finland's electricity transmission system operator Fingrid and Estonia's national grid operator Elering formerly Põhivõrk. This interconnect is considered to be the first of the series of electricity-sharing links between the Baltic and Nordic regions.

The Estlink Interconnect, which began operations in 2007, has substations at Harku in Estonia and Espoo in Finland. Reports indicate that there are plans to construct EstLink 2. The EU is expected to provide 100 million euros in funding for the proposed 600-MW EstLink 2.

In a related development, ABB has secured a $140 million contract to augment four existing power substations and build four new substations in Qatar. The project is expected to help Qatar reduce its power transmission and distribution losses and increase electricity supply efficiency. The company also has been awarded a $39 million contract by Saudi Electricity Company SEC to improve power transmission efficiency in the country's eastern provinces.

Recently, ABB announced its decision to acquire Baldor Electric Company, one of North America's leading electric motor producers, and consolidate its market presence in the region. The $4.2 billion deal is expected to be completed during the second quarter of 2011. According to the Vontobel Research Group, the acquisition will help ABB increase its revenues in fiscal year 2011 by about 5.8.