and EFACEC. The original
two transformer plants,
owned by ABB and by SPX
Corp., have expanded
For years, the availability
of low-priced imports had
made expanding U.S. capac-
ity a risky investment. Then
in 2012 the U.S. Interna-
tional Trade Commission,
acting on a complaint filed
by ABB and others, ruled
that Hyundai Heavy Indus-
tries had violated U.S. dumping laws, by
selling equipment in the United States
at less than fair value.
Since then, the Department of Commerce, acting on the ITC’s decision, has
collected 14.95 percent countervailing
duties on imported Hyundai transformers rated at 100 megavolt-amperes and
higher. By this time, however, manufacturers of big transformers had already
recognized that U.S. business opportunities outweighed U.S. cost disadvantages.
Manufacturers declined to discuss
the dumping case’s impact on their
Mitsubishi Electric Power Products Inc. (known as “Meppi”) opened
its plant in Memphis, Tenn., in April
2013. Shipments began in mid-2014. It
reported an order backlog of more than
20 transformers with ratings as high as
Hyundai Heavy Industries opened its
Montgomery, Ala., plant in November
2011 and said it can produce up to 200
big grid transformers per year with rat-
ings up to 550 MVA.
EFACEC, headquartered in Portugal,
opened operations in Rincon, Ga., near
Savannah, in April 2010. As of mid-2014
the company reports an order backlog
of about 30 transformers, adding that it
has shipped nearly 120 power transformers with capacities of 30 MVA
and higher. EFACEC said its maximum
rating is 500 MVA.
The three companies built a combined total of more than 800,000
square feet of factory space to build big
transformers. Their investments add up
to more than $500 million.
Meanwhile, SPX and ABB Inc.
expanded their facilities. SPX invested
$70 million to bring its Transformer
Solutions unit in Waukesha, Wis., to
more than 400,000 square feet; the expansion opened in April 2012. ABB said
it has steadily expanded its Transformer Remanufacturing and Engineering
Services in St. Louis, but declined to
Prior to these expansions, ABB and
SPX together supplied perhaps 5 to 10
percent of the big transformers sold in
the United States; virtually all the others were built overseas—which some
saw as a worrisomely high dependence
on imports for a vital sector of the U.S.
infrastructure. The five U.S. plants now
have the apparent capacity to meet the
foreseeable demand for big grid transformers. Indeed, estimated capacity of
the five plants adds up to more than a
typical year’s imports.
The U.S. grid may still absorb some
imports, but the decline in imports has
already begun. A U.S. Department of
Energy report, Large Power Transformers and the U.S. Electric Grid, estimated that 496 big transformers were
imported in 2013. That’s a drop of more
than 20 percent from the import peak
of 610 units in 2009. Updated in April
2014, the report was done by the Infrastructure Security and Energy Restoration Office of the Energy Department’s
Electricity Delivery and Energy Reliability unit.
The North American grid spans the
They coordinate their efforts through
U.S., Canada, and the northwest corner
of Mexico—200,000 miles of power
lines carrying voltages of 230 to 765
kV. The grid is owned and operated by
dozens of individual utility companies.
the North American Electric Reliability
Corp. in Atlanta.
Utilities use this network nonstop
to buy and sell power to each other.
These sales keep electricity supply and
demand in balance.
The big transformers are critical to
this balancing act. They connect power
plants to the electrical grid. They step
up electric force, because high-voltage
transmission minimizes losses of power
Later, as electricity travels outward
through local distribution systems, the
long-distance grid’s high voltages must
be stepped down. That process takes
more big transformers.
New and replacement transform-
1500;1800 large transformers in use
2 domestic factories (pre 9/11/2001)
90;95% of all new units were imported
400;600 units per year will need replacing
$1.4 MILLION average cost per unit