Korea AI Power Infrastructure

Korea AI Power Infrastructure is a thematic investing concept covering the Korean companies that build the hardware AI data centers run on: transformers, switchgear, high-voltage cables, busducts, energy storage, and on-site generation. With data-center electricity demand projected to more than double to about 945 TWh by 2030, Korean grid-equipment exporters have become marginal suppliers to a power-short world.

CategoryThematic / AI power & grid infrastructure (Korea)
Representative companies10
Related ETFRISE AI Electricity Infrastructure ETF (0101N0)
Last updated2026-06-10
Key takeaways
  • AI is rewriting electricity demand: global data centres used about 415 TWh in 2024 and the IEA projects roughly 945 TWh by 2030, with US data centers accounting for almost half of US demand growth.
  • The hardware is the bottleneck. Wood Mackenzie models a 30% US power-transformer supply deficit for 2025, lead times for large units average 128 weeks, and imports cover about 80% of US power-transformer supply.
  • Korean factories are the marginal supplier: Korea's ultra-high-voltage transformer exports to the US topped 1 trillion won in 2025 for the first time, and order books are stacked, with LS Electric at ₩5.6 trillion and Hyosung Heavy Industries at ₩15.1 trillion after a record ₩787 billion US 765kV order.
  • Korea is also building at home: KEPCO plans 72.8 trillion won of transmission investment by 2038 including HVDC routes and a 10 GW Yongin feed, while SK Group and AWS are building a 103 MW, roughly 7 trillion won AI data center in Ulsan with gigawatt-class ambitions.
  • The concept is investable through the RISE AI Electricity Infrastructure ETF (0101N0), listed on the KRX on September 23, 2025 with a 0.20% total fee, which tracks the KRX-Akros AI Electricity Infrastructure Index behind this concept.

What is Korea AI power infrastructure?

It is the picks-and-shovels layer of the AI boom, located in Korea. Every AI data center, whoever owns the GPUs, needs the same electrical stack: a high-voltage grid connection, large power transformers, switchgear, medium-voltage cable and busducts into the halls, batteries for ride-through, and generators or fuel cells for backup. The concept groups the Korean manufacturers of that stack, from LS Electric switchgear and Hyosung Heavy Industries 765kV transformers to Gaon Cable busducts, Taihan Cable & Solution submarine cables, and Seojin System energy-storage enclosures. The bet is not on any AI model winning. It is on the physics: compute cannot run without data center power, and the equipment that delivers it is in structural shortage.

Why is AI rewriting electricity demand?

Because data centers went from a rounding error to a demand driver in about three years. The International Energy Agency estimates global data centres consumed around 415 TWh in 2024, roughly 1.5% of world electricity, and projects consumption will more than double to about 945 TWh by 2030, slightly more than Japan’s entire electricity use today, with AI-optimised data centres more than quadrupling their demand (IEA, Energy and AI, Apr 2025). The trajectory is holding: data-centre electricity demand grew 17% in 2025, and the IEA forecasts global electricity demand rising a brisk 3.6% a year on average through 2030 (IEA, Electricity 2026). The agency’s head put the moment plainly:

“AI is one of the biggest stories in the energy world today – but until now, policy makers and markets lacked the tools to fully understand the wide-ranging impacts.”

— Fatih Birol, Executive Director, International Energy Agency (IEA, April 2025)

In the United States, data centres are on course to account for almost half of electricity-demand growth to 2030 (IEA). That demand lands on a grid whose equipment cannot be built fast enough.

Why are Korean factories the marginal supplier?

Because the shortage is structural and Korea has the spare, export-grade capacity. Wood Mackenzie models a 30% supply deficit for US power transformers in 2025 (10% for distribution units), notes US power-transformer demand has surged 116% since 2019, and estimates imports will cover about 80% of US power-transformer supply (Wood Mackenzie, Aug 2025). Lead times for large power transformers averaged 128 weeks in Wood Mackenzie’s Q2 2025 survey, with generator step-up units at 144 weeks, and power-transformer prices up 77% since 2019 (POWER Magazine, Jan 2026).

Korean exporters stepped into that gap. Korea’s ultra-high-voltage transformer exports to the US reached $690.93 million through November 2025 and crossed 1 trillion won for the full year for the first time, up from $403.45 million in 2024 and $257.97 million in 2023 (Asia Business Daily, Dec 31, 2025). The order books show the same picture. LS Electric ended Q1 2026 with a ₩5.6 trillion backlog, ₩3.1 trillion of it ultra-high-voltage transformers (LS Electric IR). Hyosung Heavy Industries booked a record ₩4.17 trillion of new orders in a single quarter, lifting its backlog to ₩15.1 trillion (Seoul Economic Daily), after winning a ₩787 billion US 765kV transformer order in February 2026, the largest single project ever for a Korean power-equipment maker (Money Today). HD Hyundai Electric took its own record ₩277.8 billion US 765kV order in September 2025 (Hankookilbo). Even the cable layer is sold out: Gaon Cable says its US-bound export volumes are fully booked through year-end (ET News).

What is Korea building at home?

A parallel domestic boom. KEPCO plans about 72.8 trillion won ($53.1 billion) of transmission investment by 2038, spanning 70 lines, HVDC routes linking the southwest to the capital region, and a substation feeding 10 GW or more to the planned Yongin semiconductor cluster (Korea Times, May 27, 2025). On the demand side, SK Group and AWS are building Korea’s largest AI data center in Ulsan, a roughly 7 trillion won ($5.1 billion) project starting at 103 MW with about 60,000 GPUs and an ambition to scale toward a gigawatt (KED Global, Jun 16, 2025). The policy floor is thick too: the government launched a 150 trillion won growth fund aimed at AI, semiconductors, and batteries (Korea Herald), and Taihan is investing $360 million in a Dangjin plant for 640kV-class HVDC submarine cable to serve grid corridors like these (Taihan).

Who should consider Korea AI power infrastructure?

It fits an investor who believes in the AI build-out but prefers contracted, profitable industrials to model-layer bets. The cash flows here are order-book-backed: LS Electric’s ₩5.6 trillion and Hyosung’s ₩15.1 trillion backlogs convert into revenue over multiple years regardless of which chatbot wins (LS Electric IR, Seoul Economic Daily). For an individual investor that makes it a satellite-sized, multi-year hold rather than a trade, since these capital-goods names have already re-rated since 2024 and carry full-cycle risk. For an institution it slots in as a picks-and-shovels sleeve inside an AI or electrification mandate, expressed in liquid KOSPI and KOSDAQ names, with won-dollar FX, US trade policy, and single-country concentration as the caveats to size against. The audience-specific questions are answered with numbers in the FAQ below.

Why does the concept work? Key drivers

Three structural drivers, none of which depends on any single AI product. First, demand duration: electricity demand compounds from data centers, electrification, and reshored industry, which is why the IEA sees the next five years adding 50% more demand per year than the past decade averaged (IEA, Electricity 2026). Second, supply rigidity: a large power transformer takes specialized steel, copper winding lines, and high-voltage test halls that take years to build, which is why deficits persist even with over $1.8 billion of announced US manufacturing expansion (Wood Mackenzie). Third, Korean positioning: decades of heavy-industry depth left Korea with export-grade transformer, cable, and ESS capacity at exactly the moment, as Wood Mackenzie’s Ben Boucher puts it, when “utilities are routinely turning to the import market to meet project timelines” (Wood Mackenzie).

Which companies represent Korea AI power infrastructure?

CompanySectorWhat it does
Gaon Cable (000500) Industrials · Wire & Cable A cable maker in Korea's LS Group whose US subsidiary LSCUS supplies busduct systems to major tech companies building American AI data centers. Posted a record Q1 2026 on US export growth, with management saying export volumes are fully booked through year-end.
Seojin System (178320) Industrials · ESS & Semiconductor Equipment Components A metal-platform manufacturer making enclosures and structures for grid-scale energy storage systems, with Fluence as its anchor ESS customer, plus semiconductor-equipment parts and server racks. Its ESS hardware rides the battery layer of the data-center power stack.
LS Electric (010120) Industrials · Power Equipment & Automation Korea's flagship electrical-equipment maker, selling switchgear, transformers, and power systems into AI data centers, semiconductors, and renewables. Its order backlog hit ₩5.6 trillion at the end of Q1 2026, ₩3.1 trillion of it ultra-high-voltage transformers.
Doosan Fuel Cell (336260) Industrials · Stationary Fuel Cells A maker of stationary power-generation fuel cells, including the 440 kW M400 hydrogen-capable unit, that can serve as on-site prime or backup power. Fuel cells are one answer to data centers that need firm power faster than the grid can connect them.
Sanil Electric (062040) Industrials · Transformers A special-transformer maker in Ansan supplying power, distribution, and pad-mounted units for renewable energy, grids, and industrial plants. The United States accounted for about 69% of its revenue in early 2026, and it has been expanding capacity to meet US grid demand.
Hyosung Heavy Industries (298040) Industrials · Power Equipment & Construction A transformer and grid-equipment heavyweight whose Memphis plant is the only US facility designing and producing 765kV ultra-high-voltage transformers. In February 2026 it won a ₩787 billion US order, the largest single project ever for a Korean power-equipment maker.
Taihan Cable & Solution (001440) Industrials · Wire & Cable A 70-year-old cable maker under Hoban Group building extra-high-voltage and submarine cables, with a $360 million Dangjin plant under construction for 640kV-class HVDC submarine cable. Its order backlog reached a record ₩3.83 trillion at the end of Q1 2026.
HD Hyundai Electric (267260) Industrials · Power Grid Equipment A leading exporter of large power transformers to the US grid, with FY2025 revenue of ₩4.08 trillion, up 23%, and a record ₩277.8 billion 765kV US transformer order won in September 2025. Its switchgear and rotating machinery round out the grid-equipment stack.
Korea Electric Power Corp (015760) Utilities · Electric Utility Korea's state-controlled utility and the customer behind the domestic build-out: it plans about 72.8 trillion won of transmission investment by 2038, including HVDC routes to the capital region and a substation feeding 10 GW or more to the Yongin semiconductor cluster.
LG Energy Solution (373220) Batteries · EV & ESS Cells The world's second-largest battery maker, supplying LFP cells and modules for grid and data-center energy storage, including a roughly $4.3 billion deal to supply Tesla's Megapack from its Michigan plant. ESS is its growth leg as EV demand stays soft.

What are the risks of Korea AI power infrastructure?

The thesis is demand-rich but cyclical, and the easy re-rating may be behind.

  • Capex cycle. Orders track AI data-center and US grid spending. A capex pause would hit new orders, pricing power, and multiples together.
  • Supply response. Wood Mackenzie expects the transformer deficit to narrow toward 2030 as more than $1.8 billion of announced manufacturing expansion comes online (Wood Mackenzie).
  • Trade and tariffs. The revenue pool is heavily US-bound, so tariffs and local-content rules can reroute orders or compress margins.
  • FX and inputs. Earnings move with the won and with copper and electrical-steel prices between order and delivery.
  • Valuation. The export boom is consensus: several names have re-rated sharply since 2024, so entry price matters.

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Frequently asked questions

What is the Korea AI power infrastructure concept?

It is the set of Korean companies that build the hardware AI data centers run on: large power transformers, switchgear, high-voltage and submarine cables, busducts, energy-storage systems, and on-site generation. The thesis is that AI's electricity demand, which the IEA projects will more than double from about 415 TWh in 2024 to around 945 TWh by 2030, collides with a shortage of grid equipment that Korean factories are unusually well placed to fill (IEA, Energy and AI).

Why is AI demand flowing to Korean grid-equipment makers?

Because the equipment is short everywhere and Korea exports it. Wood Mackenzie models a 30% supply deficit for US power transformers in 2025, with imports covering about 80% of US power-transformer supply (Wood Mackenzie). Korea's ultra-high-voltage transformer exports to the US reached $690.93 million through November 2025 and topped 1 trillion won for the full year for the first time, versus $403.45 million in all of 2024 (Asia Business Daily).

Which companies represent Korea AI power infrastructure?

Representative companies include Gaon Cable (000500), which supplies busducts to US AI data centers through its LSCUS subsidiary; LS Electric (010120) with a ₩5.6 trillion order backlog; transformer makers Hyosung Heavy Industries (298040), HD Hyundai Electric (267260), and Sanil Electric (062040); cable makers Taihan Cable & Solution (001440); ESS suppliers Seojin System (178320) and LG Energy Solution (373220); fuel-cell maker Doosan Fuel Cell (336260); and the utility KEPCO (015760).

Is there an ETF that tracks Korea AI power infrastructure?

Yes. The RISE AI Electricity Infrastructure ETF (0101N0) from KB Asset Management listed on the Korea Exchange on September 23, 2025 and tracks the KRX-Akros AI Electricity Infrastructure Index behind this concept, holding 15 Korean power-infrastructure and data-center-energy names with a total fee of 0.20% a year (KB Asset Management). Always check fees, holdings, and risk before investing.

Is Korea AI power infrastructure a good long-term theme for an individual investor?

It suits a long-horizon investor who wants the AI build-out without betting on which AI model wins, since every data center needs transformers and cables regardless. The demand runway is dated and quantified: the IEA projects data-center electricity demand roughly doubling to about 945 TWh by 2030, and Korean makers hold multi-year backlogs such as Hyosung Heavy Industries' ₩15.1 trillion (Seoul Economic Daily). The caveat is cyclicality: these are capital-goods stocks that have already re-rated, so a pause in US grid spending or AI capex would hit both earnings and multiples. That argues for sizing it as a satellite, not a core holding.

How does Korea AI power infrastructure fit an institutional or thematic mandate?

It works as a picks-and-shovels sleeve inside an AI or electrification allocation, expressed through liquid KOSPI and KOSDAQ industrials rather than pre-revenue stories. The cash flows are contracted: LS Electric's backlog stood at ₩5.6 trillion at the end of Q1 2026 with ₩3.1 trillion in ultra-high-voltage transformers (LS Electric IR), and Hyosung booked a record ₩787 billion single US order in February 2026 (Money Today). Mandate-level caveats are won-dollar FX exposure, US trade policy, and concentration in a single national supply chain.

What are the main risks of Korea AI power infrastructure?

Four stand out. First, capex cyclicality: if AI data-center or US grid spending slows, orders and pricing power fade together. Second, capacity response: Wood Mackenzie expects the transformer supply deficit to shrink toward the end of the decade as more than $1.8 billion of announced manufacturing expansion comes online (Wood Mackenzie). Third, trade policy: tariffs and local-content rules can reroute orders. Fourth, valuation: the export boom is well known, and several names have re-rated sharply since 2024.

How big is Korea's domestic AI power build-out?

Large and government-backed. KEPCO plans about 72.8 trillion won ($53.1 billion) of transmission investment by 2038, including HVDC routes to the capital region and a substation feeding 10 GW or more to the Yongin semiconductor cluster (Korea Times). SK Group and AWS are building a roughly 7 trillion won, 103 MW AI data center in Ulsan with about 60,000 GPUs and gigawatt-class ambitions (KED Global), and the government launched a 150 trillion won growth fund targeting AI and other strategic industries (Korea Herald).

Sources & references

  1. AI is set to drive surging electricity demand from data centres (Energy and AI) · International Energy Agency, 2025-04-10
  2. Electricity 2026 — Executive summary · International Energy Agency
  3. Power transformers and distribution transformers will face supply deficits of 30% and 10% in 2025 · Wood Mackenzie, 2025-08-14
  4. Transformers in 2026: Shortage, Scramble, or Self-Inflicted Crisis? · POWER Magazine, 2026-01-02
  5. Ultra-High Voltage Transformer Exports to U.S. Surpass 1 Trillion Won... Even Hotter Next Year · The Asia Business Daily (Asiae), 2025-12-31
  6. S.Korea's power transformer exports soar as global supply shortage bites · KED Global (Korea Economic Daily), 2025-06-16
  7. KEPCO to invest $53.1 bil. by 2038 to expand power supply infrastructure for advanced industries · The Korea Times, 2025-05-27
  8. SK, AWS to build South Korea's largest, multibillion-dollar AI data center · KED Global (Korea Economic Daily), 2025-06-16
  9. Korea targets AI, chips, batteries with W150tr growth fund · The Korea Herald
  10. LS Electric 1Q 2026 Earnings Release · LS Electric, 2026-04-21
  11. 미국서 대박낸 조현준 승부수..효성중공업 7870억 수주 잭팟 (record ₩787bn US 765kV transformer order) · Money Today, 2026-02-10
  12. Hyosung Heavy Industries Q1 Operating Profit Jumps 48.8% to 152.3 Billion Won · Seoul Economic Daily, 2026-04-24
  13. HD현대일렉트릭, 미국 초고압 변압기 2778억원 수주로 역대 최대 실적 달성 (record US 765kV transformer order) · Hankookilbo, 2025-09-22
  14. 가온전선, 1분기 영업이익 278억원…전년比 27.2%↑ (Gaon Cable record Q1 2026) · ET News (Electronic Times), 2026-05-15
  15. Taihan Cable & Solution to invest $360 million in HVDC submarine cable plant 2 in Dangjin · Taihan Cable & Solution, 2025-07-16
  16. RISE AI전력인프라 ETF (0101N0) — product page · KB Asset Management, 2025-09-23