A shortage of available transformers continues to plague the national construction industry, according to a new report, continuing a challenge that has been ongoing for the better part of a decade.
The data and analytics firm Wood Mackenzie is reporting that only around 20% of current transformer needs can be met by the U.S.-based supply chain. On top of that, the report estimates that overall transformer prices have jumped by a remarkable 70% to 100% since 2020.
At the same time, according to a separate report put together by the National Renewable Energy Laboratory, the demand for transformers is continuing to increase owing to economy-wide electrification and advanced computing needs.
The need is only going to grow in the immediate years ahead, with just a little over half of the roughly 70 million transformers currently in the U.S. approaching the end of their useful life at 33 years of age or greater.
All of which means, notes the Wall Street Journal, that “demand is expected to jump even more in the coming years.”
How great will the demand be? The National Renewable Energy Laboratory report forecasts that the nation’s transformer capacity requirements as of the year 2025 will be an enormous 140% to 250% greater than it is today.
Adding to the challenge is the fact that the raw materials needed to manufacture transformers, such as steel and aluminum, much of which comes from Canada and Mexico, are subject to a 25% tariff increase by the Trump administration.
“At the end of the day,” remarks the Wall Street Journal, “tariffs will pile new cost pressure on an already tight grid.”
February 24, 2025
By Garry Boulard
Photo courtesy of Pixabay
