The American Public Power Association and other energy impacted trade associations on Jan. 4 sent a letter to key congressional leaders voicing their strong support of the Senate Energy and Water Development Appropriations bill’s inclusion of $1.2 billion in repurposed supplemental funding to bolster domestic transformer manufacturing and other critical grid components.
The letter was sent to Senate Majority Leader Charles Schumer (D-N.Y.), Senate Minority Leader Mitch McConnell (R-Kentucky), Sen. Patty Murray (D-Wash.), Senate Committee on Appropriations Chair, and Sen. Susan Collins (R-Maine), Vice Chair of the Senate Committee on Appropriations.
Along with APPA, other groups signing the letter included Edison Electric Institute, the GridWise Alliance, Leading Builders of America, National Association of Homebuilders and the National Rural Electric Cooperative Association, and the National Electrical Manufacturers Association.
“In the electric utility industry reliability is paramount,” said APPA President and CEO Scott Corwin. “For over two years, we’ve been sounding the alarm on the supply chain issue. Public power utilities need solutions here to ensure grid reliability, and this critical funding represents a step in the right direction.”
APPA has made addressing the strained supply of distribution transformers one of its top policy issues.
“Ongoing supply chain challenges and unprecedented demand for grid components require additional investment to assist manufacturers in expanding capacity in order to counteract a distribution transformer shortage and ensure nationwide grid reliability and resilience,” the letter said.
Last July, the Senate Appropriations Committee unanimously passed language that includes $1.2 billion in repurposed supplemental funding for the Department of Energy’s Office of Electricity and the Grid Deployment Office to bolster the transformer and critical grid component supply chain. This provision would boost financial, procurement, and technical assistance and workforce support.
The letter emphasizes that this investment language should remain in the final Energy and Water Development Appropriations bill. This will ensure that domestic manufacturers are able to increase capacity to meet existing orders while providing greater certainty to end-users of critical grid components.
The letter also noted that prior to the COVID-19 pandemic, the distribution transformer lead time was less than one year on average.
“Today, due to complexities and inefficiencies in the supply chain, that schedule has grown to more than two years,” the letter said.
“Record demand for these products, the lack of available skilled labor to produce them, and challenges acquiring various components and materials which go in them are causing real-world problems: new building and housing construction projects have been stalled and utilities are unable to modernize the grid and help communities recover quickly from disasters,” the groups said.