Many utilities, transmission owners and even some data centers and large manufacturers building their own substations and generation sources are developing new grid capacity to support renewable energy generation, new data centers, manufacturing facilities, electric vehicles and modernizing aging infrastructure.

Due to all this growth, the need for generation step-up transformers (GSUs) went up by 274% between 2019 and 2025, according to Wood Mackenzie. Other high-voltage equipment, including breakers and switchgear, is also in demand.

High demand and limited manufacturing capacity for large power transformers has led to long lead times, with average delivery hovering at 143 weeks for GSUs and 128 weeks for power transformers in the second quarter of 2025, according to Wood Mackenzie. The United States is currently the world’s largest importer of power transformers, mainly importing from Mexico, Canada, Brazil, South Korea and European countries, according to Edvard Christoffersen, senior analyst, supply chain at Rystad Energy, a market analysis firm based in Oslo.

Suppliers of power transmission equipment have begun answering the call by investing in new factories to build more equipment capable of providing increased power generation.

Several infrastructure suppliers have announced plans for significant investments:

• Hitachi, Santa Clara, Calif., will invest $457 million for a large power transformer facility in south Boston and $106 million in transformer component manufacturing in Alamo, Tenn., along with $70 million to expand production of high-voltage components in and around Mount Pleasant, Pa., and $22.5 million to expand transformer manufacturing in Virginia.
• Siemens, Washington, D.C., expects its new $150 million transformer factory in Charlotte, N.C., to be completed in early 2026.
• Hyosung HICO, Memphis, Tenn., plans to spend $157 million to expand its transformer plant in Memphis.
• WEG, Duluth, Ga., intends to invest $77 million in its specialty transformer manufacturing facility in Washington, Mo.
• GE Vernova, Cambridge, Mass., will invest nearly $20 million to expand grid solutions factories in Charleroi, Pa., where it manufactures switchgear, and in Clearwater, Fla., where it produces capacitors and instrument transformers. GE also plans to invest $600 million in U.S. power generation, research hubs and grid facilities over the next two years.

Demand for grid infrastructure is expected to continue to increase “for at least the next decade,” according to a Hitachi spokesperson. However, the One Big Beautiful Bill Act could pose a hurdle in its efforts to restrict clean power growth. Uncertainty over tariffs may also inhibit investments.

“Increasing costs and delays of some components generally translate[s] to higher project costs and project delays,” said Cecilio Velasco, managing director at global investment firm KKR.

Nevertheless, the promised investments, which account for about one-third of global growth over the next three years, could reduce the gap between supply and demand. Wood Mackenzie reports that demand for GSUs in 2025 is 100% higher than supply but could fall to below 10% by 2030 as new capacity comes online.