Tight. 3 of 4 warning signs are red, 1 is mixed. Confidence: low, because the key market figures date from 2025.
Large power transformers remain constrained, but the best numbers we have are older than this page. Wood Mackenzie, an energy research firm, measured average waits of 128 weeks for power transformers in Q2 2025. In August 2025 it estimated US power transformer supply was about 30% short of demand. Current company commentary still shows strong transformer demand, and Siemens Energy says its transformer business drove its grid order growth. Grid equipment prices are high but, per Siemens Energy, "plateauing on a high level."
Outlook: new US plants for large power transformers start in 2027 (Siemens Energy) and 2028 (Hitachi Energy). Smaller distribution transformers have already improved.
New here? Skip to Background below for the basics. Coming back? Start with What changed.
This month
October 2026 · Updated Oct 4 · Next update after GE Vernova, Eaton and Hubbell results in late October
What changed since last month
First reading. From next month this section leads with what moved and why.
Scorecard
Warning sign | What we saw | Reading | Source (data period) |
Long waits | Average lead times of 128 weeks for power transformers and 144 weeks for generator step-up units. No newer survey of comparable quality is available. | 🔴 Yes (dated) | POWER, Jan 2 2026, citing Wood Mackenzie's Q2 2025 survey |
Orders above supply | Wood Mackenzie estimated a supply deficit of about 30% for power transformers and 6% for distribution transformers. Current company data supports strong demand but doesn't measure the gap: Siemens Energy says transformers were the strongest contributor to its 28% grid order growth. | 🔴 Yes (dated) | |
Prices going up | Mixed. Wood Mackenzie measured power transformer prices up 77% from 2019 to 2025, a cumulative rise rather than a current one. Siemens Energy says pricing across its grid business is "plateauing on a high level." That covers all grid products, not transformers alone. | ⚖️ Mixed | |
New capacity not enough | Wood Mackenzie counted about $1.8B of North American capacity expansions announced since 2023 and still estimated a 30% deficit. The new US large power transformer plants start only in 2027–2028, and about 80% of US power transformers are imported. | 🔴 Yes (dated) |
Score: 3 red, 0 green, 1 mixed, 0 unknown = 🟠 Tight. All three red signs rest on 2025 market data, so confidence is low under our rules. A fresh survey or company statement on transformer lead times or supply gaps would firm this up.
Dates to watch
Oct 27–Nov 3 (expected): Q3 results from Hubbell (Oct 27), GE Vernova (Oct 28) and Eaton (Nov 3). Listen for transformer orders, lead times and pricing.
Nov 11 (expected): Siemens Energy full-year results. Transformer commentary within Grid Technologies.
Early 2027: Siemens Energy's Charlotte plant begins US production of large power transformers.
Ongoing: tariff changes on copper, steel and imported transformers.
"Expected" dates come from earnings calendars. The company hasn't announced them yet.
Status history
- Oct 2026: 🟠 Tight (3 red, 1 mixed), low confidence. First reading.
Background
Reference. Updated when the facts change, not every month.
What it is
Power travels across the country at very high voltage. A transformer steps that voltage up or down so it can move safely and be used. There are three main classes, and they are not interchangeable:
Class | What it does, and what we know |
Generator step-up (GSU) | Raises voltage at a power plant. Longest waits in Wood Mackenzie's Q2 2025 survey (144 weeks). Demand up 274% since 2019. |
Large power transformer | Used in high-voltage substations, including those feeding data centers. 128-week average wait (Q2 2025). About 30% supply deficit (Aug 2025). Demand up 116% since 2019. This is the main bottleneck on this page. |
Distribution transformer | Smaller units near homes and buildings. Smaller deficit (6–10% depending on the Wood Mackenzie estimate), and availability has improved. |
Where it sits: Power plant → step-up transformer → high-voltage lines → substation transformer → data center → smaller transformers and switchgear inside → servers
A data center can be fully built and still sit dark if its substation transformer hasn't arrived.
When something is short, two things happen. The seller can charge more and stays fully booked. The buyer waits, or pays up. Same shortage, opposite effect on the stock.
Why can't they just build more?
- They're largely custom-built. Large transformers are made to order, and winding the copper coils is skilled manual work.
- The steel is special. They need grain-oriented electrical steel, and Wood Mackenzie notes the US has a single domestic supplier.
- The US relies on imports. About 80% of US power transformers and 50% of distribution transformers come from abroad. Since August 1, 2025, the US has charged a 50% tariff on the copper content of imported semi-finished copper products and copper-intensive derivative products. Refined copper cathodes, ores and concentrates are excluded.
- New factories take years. The large power transformer plants announced for the US open in 2027–2028.
How big is it?
Measure (Wood Mackenzie, Aug 2025) | Number |
Demand growth since 2019 | +274% step-up units, +116% power transformers, +30–80% distribution units |
US supply deficit | About 30% for power transformers, 6% for distribution transformers |
Price change, 2019 to 2025 | +77% power transformers, +45% step-up units, +78–95% distribution units |
Who wins, who waits
The effects below are our interpretation, not company statements.
Company | Likely effect | Why |
Wins | Booked $800M of US transformer orders in the first half of 2026 through its Prolec unit. Its $41B Electrification equipment backlog includes transformers, substations and switchgear, so it isn't a transformer-only measure. | |
Siemens Energy (Germany: ENR) | Wins | Transformers were the strongest contributor to Grid Technologies' 28% order growth. Its €51B grid backlog covers many products, not just transformers. Large power transformer production in Charlotte from early 2027. |
Hitachi (6501.T) | Wins | Hitachi Energy is building a $457M large power transformer plant in South Boston, Virginia, expected to ship in 2028. |
ETN, Hubbell (HUBB) | Wins | Electrical equipment makers. Eaton is building a $340M three-phase transformer plant in South Carolina for 2027. Eaton hasn't said it will make the largest transmission transformers, so we don't count it as relief for that class. |
HD Hyundai Electric (267260.KS), Hyosung Heavy Industries (298040.KS), LS Electric (010120.KS) | Wins | Korean makers that export transformers to the US, where most supply is imported. Tariffs can reduce their edge. |
Mixed | Builds substations and power lines. Grid demand is strong, but equipment delays can slow projects. | |
Mixed | New power plants need step-up transformers, which had the longest waits. Their existing plants gain because new supply is slow. | |
Exposed | New data center campuses need a substation first. A late transformer can mean a late opening. |
The takeaway: large-transformer supply remains constrained, but this page combines current company commentary with older market estimates. Fresher numbers would sharpen the picture.
When does it end, and what could replace it?
- Now: Siemens Energy says its first meaningful expansions of existing plants are coming online, including for large power transformers.
- Early 2027: Siemens Energy's Charlotte plant starts US production of large power transformers.
- 2027: Eaton's South Carolina three-phase transformer plant starts production. This adds supply, but not necessarily of the largest units.
- 2028: Hitachi Energy's South Boston plant starts shipping large power transformers.
- Workarounds: refurbishing old transformers, reserving factory slots before a site is chosen, and solid-state transformers, which are still early. GE Vernova plans to deliver a 5 MW solid-state prototype to its first hyperscaler later this year.
- Contrarian view: one transformer broker says he can deliver a standard substation power transformer within 12 to 14 months, counted from engineering approval. That excludes design, approval and procurement time, so it isn't comparable with the end-to-end waits above. He blames buying practices, not factory capacity.
What could go wrong for this view
- Supply has improved since 2025. Our main numbers are a year old. New expansions may already have narrowed the gap.
- Prices have stopped rising. If they start falling while backlogs shrink, makers' pricing power is fading.
- Data center or utility projects get cancelled, which would shorten waits for the wrong reason.
How to read a change
Good easing
Waits shrink because new US factories opened, while utility and data center orders keep growing. More projects connect on time.
Bad easing
Waits shrink because data center or utility projects got cancelled. Equipment makers' orders would slow first.
What would change our view
- Gets tighter: a new survey shows lead times rising, a factory is delayed, or makers say transformer prices are rising again.
- Gets easier (good): a new survey shows lead times falling while transformer orders still grow.
- Gets easier (bad): transformer order growth slows at GE Vernova, Siemens Energy or Eaton.
Past scorecards
Each month the previous scorecard moves here, newest first.
- None yet. October 2026 is the first reading.
Evidence and sources
Market data (2025 vintage)
- Wood Mackenzie (Aug 13, 2025): supply deficits of 30% (power) and 6% (distribution); prices since 2019 +77% (power), +45% (step-up), +78–95% (distribution); demand since 2019 +116% (power), +274% (step-up), +30–80% (distribution); about 80% of power and 50% of distribution transformers imported; about $1.8B of announced capacity since 2023; single US supplier of grain-oriented electrical steel. Wood Mackenzie
- POWER Magazine (Jan 2, 2026), reporting Wood Mackenzie's Q2 2025 survey: 128 weeks (power) and 144 weeks (step-up); distribution availability improved; a 10% distribution shortfall figure; broker Patrick Tarver's 12–14 months after engineering approval. POWER
Company statements (2026)
- Siemens Energy Q3 fiscal 2026 call (Aug 5, 2026): Grid Technologies orders up 28%, "strongest contribution coming from the transformer business"; first meaningful brownfield expansions coming online for large power transformers and gas-insulated switchgear; grid pricing "plateauing on a high level"; record €51B grid backlog, book-to-bill 1.48. Its "three to four years and beyond" lead-time remark applies to "parts of our portfolio," not specifically to transformers, so we don't use it here. Transcript · Earnings release
- GE Vernova Q2 2026 call (Jul 22, 2026): $800M of US transformer orders in the first half via Prolec; Electrification equipment backlog above $40B with growth in substations, switchgear and transformers; solid-state transformer prototype for a hyperscaler. Transcript
- Siemens Energy Charlotte large power transformer production early 2027. Power Technology
- Eaton (Feb 12, 2025): $340M plant in Jonesville, SC, for three-phase transformers; production 2027; specific ratings not disclosed. Eaton release
- Hitachi Energy: $457M South Boston large power transformer plant Hitachi release, Sep 4 2025; shipping expected by 2028 Virginia Business, Mar 1
Policy
- US copper proclamation: 50% tariff on the copper content of semi-finished copper products and intensive copper derivative products from August 1, 2025; refined cathodes, ores and concentrates excluded. White House
- Where sources disagree: most sources describe a deep shortage. One broker argues waits are a buying-process problem. Wood Mackenzie's distribution deficit appears as 6% or 10% in different releases.
Words used on this page
- Transformer: equipment that raises or lowers electrical voltage.
- Step-up transformer (GSU, generator step-up): raises voltage at a power plant so power can travel long distances.
- Large power transformer: a big transformer used in high-voltage substations and on the transmission grid.
- Substation: the yard where high-voltage power is stepped down for local use.
- Distribution transformer: smaller units near homes and buildings.
- Three-phase transformer: a transformer for three-phase power, the standard for commercial and industrial sites. Sizes range from small to large.
- Grain-oriented electrical steel (GOES): special steel used in transformer cores.
- Backlog: orders received but not yet delivered.
- Book-to-bill: new orders divided by revenue. Above 1 means orders are arriving faster than products ship.
- Brownfield expansion: adding capacity at an existing plant rather than building a new one.
- Solid-state transformer: a newer, electronics-based transformer that's smaller but still early.
- Dated: the sign rests on data more than 12 months old. It still counts toward the status but lowers confidence.
Invest Deeper · Educational research, not investment advice.
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