Transformer, breaker backlogs persist, despite reshoring progress

In July, U.S. steelmaker Cleveland-Cliffs revealed plans to build an electrical distribution transformer plant on an idled industrial site in Weirton, West Virginia. The proposed project, which Cliffs said could eventually employ 600 union workers recently laid off from a neighboring facility, was a big enough deal to attract the state’s Republican governor to a press conference onsite.

Less than a year later, Cliffs abandoned the project as part of a wider shift away from what CEO Lourenco Goncalves called “non-core markets” on a May 7 investor call.

The decision highlighted ongoing challenges for a commercial electrical equipment supply chain that has yet to fully recover from the COVID-19 pandemic. On average, customers today wait three years for high-voltage transformers and one year for distribution transformers, said Adrienne Lotto, senior vice president of grid security, technical and operations services at the American Public Power Association. About 80% of the former and 40% to 50% of the latter are imported, according to Benjamin Boucher, a Wood Mackenzie senior data analyst focused on electrical supply chains.

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