Huawei’s new Digital Power business for sustainable Sri Lanka

On 28 March, telecom company Huawei Technologies released its Annual Report for the year 2021. According to the Annual Report, Huawei’s revenue in 2021 recorded 636.9 billion yuan. Though the sales revenue declined from the last year, “the business performance is in line with forecast”, said rotating Chairman Guo Ping. Despite the US sanctions effective for a third year, the company shows its resilience and witnessed a record-high net profit of 113.7 billion yuan, up 75.9% year-on-year. 

The steady performance of Huawei can be attributed to its diversifying strategy for the past two years. Huawei is looking to develop new growth revenue streams outside of base station infrastructure and handsets, with a cloud business, smart ports, mining, and smart electric vehicles businesses. 

Digital Power is one of the rapidly growing new businesses that are of great relevance to the understanding of the company’s future strategy. When the smartphone business takes a hit, and the demand for 5G base stations slows down, the company eyes on utilising its strength and experience in digital and power electronics technologies to expand the business scopes.

Huawei’s Digital Power business emerges and grows as the world society shows a focus on sustainable development and the proliferation of renewable energy. According to the World Economic Forum, ICT is expected to help other industries cut carbon emissions by 12.1 billion tons by 2030, with more than 1.8 billion tons of this being in the energy sector alone. 

In terms of power generation, the International Energy Agency (IEA) predicts that the adoption of digital technologies could reduce annual power generation costs by 80 billion US dollars between 2016 and 2040, equal to 5% of the total global cost of power generation. 

In this context, Huawei Digital Power is committed to integrating digital and power electronics technologies, developing clean power, and enabling energy digitalisation to drive energy revolution for a better, greener future. In June 2021, Huawei Digital Power Technologies Co. Ltd. was formally established. 

It covers business domains including Smart PV, Data Centre Facility, Site Power Facility, DriveONE, Embedded Power, and Integrated Smart Energy. It operates 12 R&D centres across the world and holds more than 1,600 patents (by the end of 2021). With approximately 6,000 employees, 60% of whom are focused on R&D, Huawei Digital Power serves one-third of the world’s population across more than 170 countries and regions.

Over the past few years, Huawei Digital Power had helped its customers generate 482.9 billion kWh of green power and save about 14.2 billion kWh of electricity. These efforts have resulted in a reduction of nearly 230 million tons in CO2 emissions, equivalent to planting 320 million trees. 

In Saudi Arabia, Huawei is providing energy storage and PV solutions for the Red Sea Project, the world’s largest microgrid energy storage project. This project will see the construction of the world’s first city to be powered solely by PV with energy storage.

Amid the rapid growth in global business, Huawei digital power sees opportunity in Sri Lanka as well. In February 2022, the company released its latest digital power product, Huawei’s Luna2000, the SMART Energy Storage System, which aims to help achieve sustainable energy targets for the country; to support a stable grid and night peak demands. 

Huawei’s new push is of great potential for the energy shortage-stricken Sri Lanka. Currently, the island is suffering from a nationwide power cut since the beginning of 2022. 

The situation got worse as the Ukraine crisis pushed up global gas and fuel price and the Central Bank adopted a policy to float the currency exchange rate which exacerbated the financial loss for CEB and CPC. Huawei’s battery solution in solar energy will be a great compliment to the resiliency of the solar energy sector. 

According to a Huawei Digital Power spokesperson in Sri Lanka: “Huawei has taken solid steps to focus on the residential and Energy storage systems domain by cooperating with local resellers and partners to make our products locally available. 

“Our trusted value-added partner will fulfil residential energy sector requirements, manage service replacement and provide technical assistance. The first pilot project with LUNA 2000 ESS is successfully commissioned and the first batch is scheduled to arrive in early April.”

Major countries like US, China and India all shared their willingness to support the financing and investment of Sri Lanka’s renewable energy projects. In the long run, the country will strive to achieve carbon neutrality by 2050, and the Government targeted 70% of power from renewables by 2030. 

Solar power is also one of the cheapest sources of energy and Sri Lanka has strong solar resources. With the help of digital technology, the efficiency and safety of these new energies will be secured. The involvement of digital giants like Huawei in Sri Lanka’s renewable energy sector will also uplift the country’s capability to optimise power management.