USA, Washington, D.C.: New US restrictions on foreign-made bulk-power equipment could worsen existing shortages of power transformers and substations, according to analysis from Wood Mackenzie.
The consultancy estimates that the US market is already facing a 15 % shortage of power transformers and an 8 % shortage of substations in 2026. It says Executive Order 14420 could affect more than $22 B in bulk-power equipment imports recorded since 2025, with China accounting for the overwhelming majority of the potentially affected imports.
Wood Mackenzie expects the greatest pressure in the 100 MVA+ transformer segment, where shortages are already particularly acute. The broader US market for transformers above 10 MVA has expanded by nearly 300 % since 2020.
According to Ben Boucher, principal analyst for supply chain at Wood Mackenzie, utilities have largely avoided Chinese suppliers since earlier restrictions were introduced. The greater impact could therefore fall on data centres, which have increasingly sourced Chinese transformers to reduce lead times.
The full effect remains uncertain because the application of the bulk-power definition to data-centre loads has yet to be clarified.
The US Department of Energy is expected to define the detailed implementation of the order within 120 days, which will determine how broadly the restrictions apply and how significantly they affect transformer procurement.
Source: Wood Mackenzie
