A transformer supply crisis bottlenecks energy projects

From the article:

The demand for transformers has spiked worldwide, and so the wait time to get a new transformer has doubled from 50 weeks in 2021 to nearly two years now, according to a report from Wood MacKenzie, an energy-analytics firm. The wait for the more specialized large power transformers (LPTs), which step up voltage from power stations to transmission lines, is up to four years. Costs have also climbed by 60 to 80 percent since 2020.

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A quarter of the world’s renewable-energy projects may be delayed while awaiting transformers to connect them to local grids, according to the Wood MacKenzie report. In India, the wait for 220-kilovolt transformers has leaped from 8 to 14 months, potentially holding up nearly 150 gigawatts of new solar development.

And it’s not just renewable-energy projects. The transformer shortage touches utilities, homeowners, businesses, rail systems, EV charging stations—anyone needing a grid connection. In Clallam County, the part of Washington state where the Twilight movies are set, officials in May 2022 began to deny new home-construction requests because they couldn’t get enough pad-mounted transformers to step down voltage to homes. To address the backlog of customers who had already paid for new electrical service, the utility scrounged up refurbished transformers, or “ranch runners,” which helped but likely won’t last as long as new ones.

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Driving the transformer shortage are market forces stemming from electricity demand and material supply chains. For example, nearly all transformer cores are made of grain-oriented electrical steel, or GOES—a material also used in electric motors and EV chargers. The expansion of those adjacent industries has intensified the demand for GOES and diverted much of the supply.

On top of this, transformer manufacturing generally slowed after a boom period about 20 years ago. Hitachi Energy, Siemens Energy, and Virginia Transformers have announced plans to scale up production with new facilities in Australia, China, Colombia, Finland, Germany, Mexico, the United States, and Vietnam. But those efforts won’t ease the logjam soon.

At the same time, the demand for transformers has skyrocketed over the last two years by as much as 70 percent for some U.S. manufacturers. Global demand for LPTs with voltages over 100 kV has grown more than 47 percent since 2020, and is expected to increase another 30 percent by 2030, according to research by Wilfried Breuer, managing director of German electrical equipment manufacturer Maschinenfabrik Reinhausen, in Regensburg. Aging grid infrastructure, new renewable-energy generation, expanding electrification, increased EV charging stations, and new data centers all contribute to the rising demand for these machines.