While a Department of Energy final rule on energy efficiency standards for distribution transformers is an improvement over the proposed rule, the final rule does not solve the shortage of distribution transformers that existed before DOE’s proposed rule, the American Public Power Association and other trade groups said in asking Congress to expand domestic manufacturing capacity for distribution transformers.
The DOE issued the final rule on April 4.
“While the final rule will provide some predictability for certain components within the distribution transformer production supply chain, it neither solved the shortage of distribution transformers which existed before DOE’s proposed rule nor did it address the lengthy lead time average to procure a new product, which currently can be up to 30 months,” the groups said in the April 22 letter to leaders of the House and Senate Appropriations Committees.
Congressional assistance is necessary “to provide confidence and certainty to expand domestic manufacturing capacity for distribution transformers,” the letter said.
“Unprecedented demand for grid components remains and is expected to continue for the foreseeable future. According to the National Renewable Energy Laboratory, this demand will be driven largely by replacement of aging infrastructure and investments in electrification, such as data centers, electric vehicles, and heat pumps,” the groups noted.
The efficiency standards detailed in the final rule “provide a manageable production framework for manufacturers to address that demand growth; as such, industry discourages further attempts to delay or postpone the rule through the Fiscal Year 2025 funding process,” the letter said.
“Instead, our coalition again requests assistance from Congress to expand domestic manufacturing capacity for distribution transformers to reduce these lead-time averages or, at the very least, to prevent them from growing. Without additional manufacturing capacity in the near-term, grid reliability and resilience remain highly vulnerable.”
APPA and the other groups said they will continue to “collaborate with DOE to explore constructive solutions to address supply chain issues around distribution transformers and other critical grid components. Further, we look forward to engaging with Congress during the FY2025 appropriations process to identify pathways to deploy resources to keep America’s grid robust and secure.”
In addition to APPA, the letter was signed by the Edison Electric Institute, GridWise Alliance, Leading Builders of America, National Association of Home Builders, National Electrical Manufacturers Association, National Rural Electric Cooperative Association, and the Transformer Manufacturing Association of America.
