Speaking of the Grid, What About Transformers?

If you have read some of our postings over the past few months, The Fusion Report has provided a lot of coverage to the grid. One of the most important parts of the grid are transformers. While most people think of these devices as decidedly old style, transformers (especially the large ones used for low-voltage to high-voltage power conversion, which are also known as step-up/step-down transformers) are extremely critical to the grid. These devices enable the transmission of electricity across medium and long distances by raising voltages up so that less of the energy is lost in resistive heating. When the power gets to where it will be consumed, it is then stepped down for easier (and safer) consumption.

Globalization, Supply Chain Issues Impact High-Power Transformers

Most of the US power grid was built and deployed fifty to sixty years ago. In those days, components like step-up/step-down transformers were built in the US. However, like many manufactured systems and subsystems that were previously built in the US, much of this manufacturing moved overseas during the last twenty to thirty years. Today, roughly 80% of the high-power transformers utilized in the US are imported.

Exacerbating this problem is the fact that most large transformers in the US today are approaching forty years in age, which is the expected lifespan for these devices. That means higher demand for replacement transformers that have to be imported. And the problem is not just for the finished product – it is also a problem for the grain-oriented electric steel (GOES) that is used in the cores of these large transformers, as well as in electric vehicles and in high-efficiency motors and generators. In fact, there is only one producer of GOES in the US today – like the rest of the steel industry, it has mostly “left the building”.

The impact of these supply chain issues for both transformers and GOES has largely been in extending the timeframe it takes to procure large high-power transformers. While lead times to procure these large transformers thirty years ago were measured in months, they are now measured in years, with some taking up to seven years to get. Of course, the price for these transformers also reflect these supply chain shortages, with prices for some models doubling since 2018. This is all in the face of increasing demand for these devices due to the rapidly growing demand for electricity. And the impact of US tariffs could make these devices even more expensive.

Can Solid-State Technology Breathe New Life Into Transformers?

Normally, one could solve a problem of limited domestic suppliers of large high-power transformers simply by incentivizing manufacturers to add capacity to their onshore plants. While some large transformer manufacturers such as Hitachi are doing exactly that by building new plants in the US, the shortage of GOES limits the extent to which this strategy can improve the supply chain situation. So the question becomes whether technology can come to the rescue in some fashion that enables large high-power transformers to be built another way.

One potential answer is solid-state transformers (SSTs), a device that utilizes semiconductor-based switching to increase and decrease the voltage of electrical transmissions. 

In addition to performing the step-up/step-down functions of conventional
transformers, SSTs can perform a number of functions currently provided by other power grid subsystems:

• Power Filtering: Because SSTs are active devices, they can provide voltages that are not just stepped up or stepped down; they can also provide active filtering of these voltages as well to eliminate power frequency harmonics.
• Power Factor Correction: In addition to filtering, an SST can provide power factor correction, increasing or decreasing the reactive power in the grid. Additionally, SSTs can manage both voltage and frequency of the power.
• Bi-Directional Power: One of the unique capabilities of SSTs is that they are bi-directional; i.e., the flow of power can be reversed in them. For renewable power sources that incorporate energy storage systems, SSTs simplify the integration of the two systems.
• Integration With the Grid: Because each SST at the “head” (supply point) of a microgrid can be separately managed, integration with the overall grid becomes much easier, and isolation of parts of the grid from each other is much simpler.

How Far Away Are We From Operational Deployment of SSTs?

There are a number of companies developing SST, including both established companies and startups. Major players include Siemens AG, ABB’s Hitachi Energy Division, General Electric, Schneider Electric SE, Mitsubishi, Delta Electronics, ERMCO, Kirloskar Electric, Maschinenfabrik Reinhausen, Synergy Transformers, and Eaton Electronics. Startups pursuing SSTs include DG Matrix, Varentec, Heron Power, Magment, Resilient Power Systems, CorePower Magnetics, PeraWatt Energy, Ampersand, and Alderbuck Energy. Total venture capital invested in startup SST development today is unknown, but is probably less than $100 million. Test units were installed by GE in October 201, and by Delta Electronics in 2022. Not unlike any new technology, we are still “five years away”, as the initial higher costs of SSTs are whittled away to increase market penetration.