Interview with JASON NEAL
Senior Executive Vice President, HICO America Sustainability is important to our company, to the industry, and the world. The growth of renewable energy and renewable sources of generation, like wind and solar, is extremely important; to the growth of electric vehicles and the infrastructure to support them, that’s important as well. It means great opportunity, but also great challenges. Alan Ross
I’m Alan Ross. I’m the Managing Editor of Power Systems Technology and Transformer Technology. My guest today is Jason Neal. Jason, what are your titles at HICO? 
Jason Neal
President of Hyosung HICO and Senior Executive Vice President of HICO America.
AR
Tell me about your background, your career, and your trajectory.
JN
I’m an electrical engineer by education. I worked with a few other companies in the industry and had the great fortune of joining HICO when we started our business here in the US in September of 2001. I’ve been here ever since in different roles. 
AR
Let’s talk about one of the things you and I had a conversation about before – sustainability of power systems. Describe what that means when you say sustainability of power systems.
JN
Sustainability is important to our company, it’s important to the industry and the world. The growth of renewable energy and renewable sources of generation, like wind and solar, is extremely important; to the growth of electric vehicles and the infrastructure to support them, that’s important as well. It means a great opportunity, but also great challenges. Utilities and the market are facing unprecedented challenges. Renewable energy is excellent, but to incorporate those resources we have to balance the power system, frequency issues, voltage issues, developing solutions around that; suppliers need to be attentive to the market and the industry needs to bring solutions that can enable more wind, more solar to be installed here in the States.
AR
The word “sustainable” typically means we are using products or doing something which helps save the Earth. When you talk about sustainability of power systems, you’re really talking about sustainability of the power grid for our economy, right?
JN
Yes. Sustainable energy sources, resiliency of the grid itself and the solutions that are to support the incorporation of any generation source, be that something that’s renewable or sustainable or generation sources that are here already in the market. It’s more than just green energy. It’s a resilient, stable power grid with stable supply bases, stable sources of generation as well.
AR
We have a situation that whether it’s the hot summer or the cold winter, ERCOT, the Texas grid, is tending to have problems that they never had before. We’re in a situation where there is extreme heat. Everybody’s running air conditioning. In fact, you couldn’t live in Houston if there was no air conditioning. So the idea is that power is so critical and important. Then we tell everybody it’s not just power utilities anymore. You now have to worry about green energy. Talk a little bit about your idea of how green energy, storage, wind, and solar all plays into this resiliency of the grid, especially when it comes to battery storage.
JN
There’s a lot of applications for battery storage, certainly the classic use-case of integrating renewable sources of energy, like wind and solar. That’s a great opportunity. There are challenges with that in and of itself. You can’t be focused on just one technology. That battery choice is important; looking ahead to new battery technologies like flow batteries, long duration batteries, certainly there are challenges there. Even selection of things like inverters – either inverters that could be grid- following, or inverters that could be grid-forming, and having islanding capabilities. The classic application for storage is really aligned with green energy, but there are other applications as well. You can think about battery storage as having the potential to bring stability to the power system. All the inverter-based generation, STATCOM, synchronous condensers, they all have a place, but so does battery storage. It’s selecting that inverter that’s quick responding to being called upon and injecting that power, that can be a way to regulate frequency. Photo Credit: HICO America AR
California has a lot of solar and wind,  but the inverter-based system is aging  the distribution transformers much faster than  they had planned for. Because we’re in a stepdown  world, suddenly we’re step everywhere.  Talk a little bit about that, because you  mentioned inverters, but what does that do to  the sustainability of the existing grid?
JN
Whether it’s these distribution  transformers that are directly connected, or transformers that are elsewhere  on the system the system, the new harmonics  that are on the system and the need to consider  equipment that may not have been designed  for that; it’s not just that installation itself, it’s  the transmission system. It’s the impact on the  transmission system and it’s the distribution  of that power to the end user and all the  equipment that’s down the line that has to be  considered, including, as you say, distribution  transformers. As well as all these solutions are  coming about with STATCOMs and synchronous  condensers to balance that out.
AR
With 22 years under your belt, it  is a good time to be where you are  because you know what great change brings?  Opportunity. Everything you’ve described is all a lot going on, but it’s all opportunity. One  of the things that’s changing that I want to talk  a little bit about, what’s going on in your mind  with how are we replacing SF6, both from the  standpoint of the gas itself and the standpoint  of the equipment? How are we handling that  change or how is your company handling it?
JN
There’s a lot of ways to look at it. First is  looking at the existing SF6 equipment  that’s being delivered now and managing the  emission of SF6, reducing the leak rates of  this equipment. If it’s the IEEE standard being  changed at 0.5 % per year to a utility specifying  0.1 % per year, suppliers have to step up to  address that. But it’s also, as you said, developing  new technology using non-SF6 solutions. So  if it’s things like we’re doing with our medium  voltage gear, being the first company to market  with a zero global warming potential gas for our  medium voltage gear to the installed base that  we have with our non SF6 high voltage GIS, it’s  a combination. We saw with state of New York,  I think it was last month, following what’s going  on in California and Massachusetts on these  requirements for eliminating SF6. And it’s managing the emissions, it’s pushing the  development of new technology and non-SF6  technology, and making sure to address cases  where there may not be technology available  and how to handle that. But it’s a very important  development.
AR
Another change that’s coming that’s  going to bring opportunity for those  people that can adapt. It’s driving some of the  utilities nuts, but guess what? That’s what we’re supposed to – drive them to the new solutions.  Right now, we have a shortage of transformers.  It doesn’t matter what class of transformer  you’re trying to get. It’s hard to do it. Then you  have the government saying they want to go to amorphous steel and get away from grain oriented  steel. However, we’ve got 25 % tariffs  on grain. We’re doing everything that we can to  make it harder to make transformers. And yet  we have a transformer shortage. What’s your  experience with that right now?
JN
Looking at it long term, demand is  far exceeding supply. All these things  we’ve spoken about, the growth of renewables,  the growth and the infrastructure development  to incorporate EVs, big data. Utilities are facing  challenges like never before, unprecedented.  As a supplier, there’s a few things that the  companies could be doing. One is definitely  attacking the supply chain. Since COVID, since  the war in Ukraine, there’s been certainly  more of a focus and more visibility in the  supply chain, onshoring suppliers, near-shoring  suppliers, and making sure the relationships  with suppliers are strong, because now is the  time where suppliers have to step up and perform. I think it’s attracting talent to our  industry, training people and retaining them so we can build more. Now we are the cool  industry. I think the industry is doing a solid job  of selling the future of power. You look at all  the developments that are going on right now  with EVs, with new battery technologies, with  hydrogen, power electronics, statcoms, HVDC.  We’re the cool industry to work for. We need to  keep selling that to attract people so that we  could do more as suppliers. The classic application for storage is really aligned with green energy, but there are other applications as well. You can think about battery storage as having the potential to bring stability to the power system. AR
We had a meeting this morning  talking about an issue that we’re  going to be doing, our issue on women in power  systems. Now you’re getting more and more  women. There are more women in EE programs  in the United States than ever before, which  is great. That’s beyond STEM, right? I think it’s  because we’re the cool industry. I’m going to  get a T-shirt that says now I’m cool.
JN
Listen, there’s great opportunity. My  father worked for a local utility here  for 38 years. When I came out of school, I’ll be  honest, the last thing I wanted to do was get  into utilities. It wasn’t the exciting industry at the  time right? Back then it was semiconductors.  It was process control. But if you look at it and  the folks that we’re bringing on board and why  they’re staying, it’s exciting. It’s a great time for  the industry.
AR
Let’s talk now specifically about  HICO America and Hyosung. In the  marketplace, people say, it’s the big three, big  four. It’s GE Vernova, Siemens, Hitachi, which  was Hitachi, and then ABB, now it’s Hitachi ABB. From the mindset standpoint, HICO Hyosung,  and especially HICO Americas, you’re not a  new entrant into the market, but you’re a large  entrant into the market. Talk a little bit about  where you see the future for HICO America.  What’s your go to market strategy?
JN
We’ve been here, like I mentioned,  since September of ’01. Our initial focus  was power transformers. As a company, if you  look at Hyosung as a whole, sustainability and  green energy offerings are important, but so  is onshoring production. On the transformer  side of our business, establishing that factory in  Memphis was a dream for me, for all of us that  have been with HICO for a long time. We are increasing our ability to ramp up  Memphis to address the new demand from  the market, which is far exceeding supply. But  the other lines of our business are growing  just as quickly. We are offering STATCOM,  Battery Storage, HV and MV GIS as well  as services around these solutions. So no  longer are we just building a high-voltage or  a medium-voltage gas insulated switchgear  and substations. We’re also expanding our  business to be able to serve and maintain that  substation for 5, 10, 15 plus years.
AR
The Department of Labor estimates  that every year between 2020 and  2030, we’re going to lose 5 % of the current labor  force. Plus, we’re going to need 13 % more than  we currently have. So you have a net negative  of 18 % a year annualized. I want to talk about  your philosophy for how do you recruit, train,  promote, and inspire those people that are out  in the field doing the kinds of maintenance, the  kinds of work that you need them to do. 
JN
A big part is the training. There’s a lot of  experience here in the market. There’s  a lot of great folks working with suppliers and  customers all across the market. They need to  impart that wisdom and experience. We’ve built a nice blend of folks that have been in this industry  with experience, folks that have come from  other industries. When you’re maintaining some  of these installations, the HVAC and pumps and  coolers are just as important as the equipment  itself. So that blend of people with experience in  those areas is important. Then, bringing that next  generation of maintenance persons, technicians,  or engineers on board to learn from those folks, to  get hands on experience side by side, and then to  continue to grow how they work here and become  the next generation of trainers, so to speak. 
AR
The other thing that you mentioned  was, for any of your customers, you  can either componentize, you can sell them a  transformer, install a transformer, you can work  with their GIS system, all that, or you can do it all,  it seems like, which is a concept that I think a lot  of, especially the smaller utilities are looking for.  Is that the strategy that you’re trying to present  to them?
JN
It is. It’s important to adapt to what  solution the customer needs. If it’s a  component- based project or product-based  project, or if it’s a full turnkey, soup-to-nuts, plus  maintaining it for future years. And there are  large utilities, large developers as well as smaller companies that need that service. But it’s really  being attentive and being able to adapt. But that  really is the industry. I think that’s where the  growth is. And certainly for HICO, that’s where  our growth is as well. Having that flexibility,  listening to the voice of the customer always will  be our guide and lead us into the right aspects of  the market. 
AR
Back in the 1980s and 90s, we use the  word full solution, whereas Solutions  Company, everybody put on their website  Solutions Company, meaning the customer would  come to us and whatever they needed, we would  provide them with the solution. But a complex  solution requires complex thinking. It requires a  different level of consultative engineering doing.  My assumption is that you’ve built that and are continuing to build that, which is different than  the installation and maintenance people. This  is now the brainiacs that are saying, this is what  you need, Mr. Utility, for the future. Is that a fair  statement?
JN
Very fair. And you need that feedback  loop as well. So the folks that are  working on these projects in a certain application,  getting that feedback to our R&D folks. We’re  continuing to develop the solutions that the  market needs. Therefore, adaptability and  the flexibility to tailor what we’re doing to the  customer is important. But that feedback loop  of the experience from that project, leading  to the next generation of batteries or statcom  valves, non SF6 gas technology is also another  aspect of this. 
AR
I’m glad that you’ve got the Memphis  facility. I live in Atlanta, so we’re  about five hours apart and I want to come and  visit you. I was there when that facility first  really came online years ago. Congratulations  because you bought that facility from  somebody, right?
JN
We did. Initially, we announced, it’s  probably five years ago now, that  we would build a new transformer facility in  the US, then the facility in Memphis became  available. And it’s a beautiful facility. Great  equipment, great people that were there. And  it’s been a great success story for us from the  beginning. We opened Valentine’s Day at 2020  and shipped our first transformer in June of  that year, despite COVID and all the other  challenges. We hit the ground running and we  haven’t stopped since. Photo Credit: HICO America AR
There’s a lot of change going on and some of it negative. I mean, we’ve got a lot of pushback from people that are saying, hey, you’re moving too fast.Wind and solar cannot sustain this, we don’t have a sustainable EV market. These problems can be insurmountable if you look at them in the macro. When you look at them, what do you see?
JN
It’s really an opportunity. Our utility partners need time to focus and be forward thinking on these. Now more than ever, suppliers have to perform well. A utility should  not be worrying about how supplier X, Y, or Z is going to be performing on a specific project. We’re responsible to make sure we’re performing well so utilities can continue to be more forward-thinking. But that partnership between the utility and the supplier, with our tier one and tier two suppliers to make sure not only are we performing, but we’re developing the technologies, we’re responsibly ramping up production to support the demand, to support the utilities and developers and all these challenges they’re facing is more important now than ever. Share this article