Transformer Shortages & Price Spikes
Electrical utilities across the country and globally are facing unprecedented multi-year supply chain issues for a wide variety of electric distribution equipment, and most significantly distribution transformers. Supply chain disruptions are tied to worldwide material demand and shortages caused by the pandemic, labor constraints, shipping issues, and even the war in Ukraine.
Transformers vary in size and are rated in kVAs (amps). The most common transformer used by the PUD is a 25kVA padmount (meaning the green cabinet kind that sit on the ground) transformer. It typically supplies power to around 4 homes. In normal years, the PUD tries to keep a stock of 60 25kVA units at all times, with a minimum on-hand quantity being 20 units. Current stock is well below that minimum.
Large orders for pad-mounted transformers, which typically took between 6–12 weeks to fulfill in 2020, now have lead times of 52–86 weeks. Transformer orders slated for arrival in mid-2021 have been postponed several times, with final arrival dates yet to be determined.
As the global supply of transformers has diminished, prices have risen accordingly. 25kVA pad-mounted transformer pricing rose nearly 400% from 2020 per-unit pricing, and 50kVa unit pricing jumped 900% since 2020. Pole-mounted transformers, which the PUD uses less of, have seen similar price increases, as well as extended lead times with no guarantees of meeting price quotes.
What does this mean for PUD customers? While the PUD has to date been able to supply transformers to customers seeking new service with minimal delays, supply chain issues could result in delays of connections in the months ahead.
The cost of new connections has also increased. The PUD increased charges for new connections in 2021 to cover industry-wide increases in materials costs. Unfortunately, costs continued to increase, with transformer prices changing almost daily. The PUD revised its charges again in early 2022, opting to pass on the cost of the transformer to the customer. Those charges went into effect June 1st. The full set of charges can be found in Exhibit B on the Rates/Specifications page under the ELECTRIC tab on our website.
