Transformers play a central role in our electricity infrastructure. They step up voltage at power plants for efficient long-distance transmission and then step down the voltage with distribution transformers for safe use in homes and businesses. As our electricity needs grow, so does the demand for transformers. The U.S. Energy Information Administration projects a national demand increase from 4,000 terawatt hours to 5,000 terawatt hours of electricity or more by 2030.
Our Changing Grid
A recent article by the National Renewable Energy Laboratory [i] highlighted three key factors which will influence the demand for transformers.
- Aging Infrastructure: Up to 50% of the transformers currently deployed are over 33 years old and nearing the end of planned lifecycle. These aging units require replacement, and with our changing electricity needs, they need to be replaced with larger, more robust transformers.
- Evolving Electricity Demands: The rise of electric vehicle charging stations and data centers are two significant factors impacting electricity demand. For example, a single 100-megawatt data center can consume more electricity than the electricity usage of over 80,000 homes.
- Moving the Grid Underground: The long-term trend of shifting electricity distribution from overhead to underground lines will shift demand to pad-mount transformers from pole-mount models. Extreme weather events, wildfire mitigation efforts, and the need for larger transformers all contribute to this trend.
Rea Positions for Growth
As the leading magnet wire supplier to the distribution transformer market, Rea Magnet Wire is investing to meet the needs of this growing market. 2025 will see an expansion in the capacity of Magneflex—the extruded polymer product currently manufactured in Ashland, Virginia and Lafayette, Indiana. Please contact your Rea representatives to learn more about how we are investing to support this growing market in 2025 and beyond.
Please visit https://www.reawire.com/industries/transformers/ for more information on the full breadth of product offerings Rea offers to serve the distribution transformer market.
[i] “Distribution Transformer Demand: Understanding Demand Segmentation, Drivers, and Management Through 2050.” NREL: McKenna, Killian; Abraham, Sherin Ann; Wang, Wenbao; Poudyal, Abodh. November 2024. Accessed: 10 January 2025. https://docs.nrel.gov/docs/fy25osti/92076.pdf
