Avangrid has announced a strategic investment of $7 million to purchase five power transformers manufactured in Washington, Missouri by American manufacturer WEG Transformers USA.
The investment is part of Avangrid’s plan to invest $18.5 million in grid infrastructure by 2028, and the five transformers will be utilized by Avangrid utility companies Central Maine Power and New York State Electric & Gas.
“Sourcing these transformers here in the U.S. is a clear investment in American workers and American manufacturing,” said Avangrid CEO Jose Antonio Miranda. “As we move forward with our plan to direct $18.5 billion in a modern, resilient grid, we’re putting that investment to work in American factories, supporting American jobs, and strengthening the nation’s energy independence.”
“WEG Transformers USA is excited and honored to be able to provide the transformers for this critical project,” said Phillip James, VP WEG Transformers USA. “Avangrid is a long-term customer for WEG and we really appreciate the confidence that Avangrid has in WEG to provide transformers for the infrastructure projects of their utility companies in the US.”
In 2024, Avangrid grew its investment with U.S. suppliers to $4.3 billion, representing a 16% increase compared to 2023. In September, Avangrid announced Iberdrola’s plans to invest $18.5 billion in the United States by 2028, with most investment directed toward grid and gas infrastructure.
According to the 2025 report “Untangling the US transformer supply chain crisis,” since 2019, Wood Mackenzie estimates that US power and distribution transformers have seen demand surge by 116% and 41%, respectively. This has been due to a confluence of new demand drivers, including a rise in electricity consumption, which has increased 7% since 2020, reversing a 1% decline from 2010 to 2020, the growing pipeline for clean energy projects, and aging infrastructure, Wood Mackenzie notes.
Supply has not kept pace with demand, resulting in a growing market deficit across all transformer specifications and escalating lead times and prices, the report found.
To meet demand, many of the largest original equipment manufacturers (OEMs) have announced investments into capacity expansions totaling $1.8 billion since 2023, specifically targeting the North American market. While this could alleviate some pressure, the demand growth rate will necessitate further expenditure to rebalance the market, according to the report.
The U.S. is in the middle of an unprecedented imbalance between supply and demand for power transformers, which has left the energy sector anxious and uncertain about the stability of the future grid. Last year, the National Renewable Energy Laboratory (NREL) completed the first phase of a study that quantified the number, capacity, age, and use of the nation’s current transformer stock – something it says has never been done before.
Based on the transformer data collected, NREL estimates that distribution transformer supply may need to increase 160%-260% by 2050 compared to 2021 levels to meet residential, commercial, industrial, and transportation energy demands. NREL says the demand increase is largely driven by aging transformers and electrification. NREL is also examining potential demand increases from extreme weather events and utility undergrounding and resilience programs that use various types of transformers.
