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Siemens Energy invests ＄150 million to expand operations in Charlotte and build U.S. power transformers essential to the energy transition and vital infrastructure.
The company Siemens Energy is taking measures to combat the shortage of power transformers in the United States. With an investment of ＄150 million, the company will expand its operations in Charlotte, North Carolina, building a new factory that will be essential to meet the growing demand for this equipment essential for the energy transition and country's infrastructure.
In addition to meeting the need for power transformers, the new Siemens Energy factory in Charlotte will also contribute to strengthening the production chain of power equipment In the USA. With more than 600 new jobs created, the initiative not only boosts the local economy, but also represents a significant milestone for the country's energy industry, ensuring a more stable and reliable supply of power transformers.
Power transformers: Driving the energy transition
local jobs. Currently, only 20% of demand for large power transformers in the United States is met by domestic suppliers, which can have lead times of up to five years. Power transformers connect generation to distribution and are an essential part of any electrical distribution network by converting high-voltage electricity into lower voltages.
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Custom-built and about the size of a standard school bus, power transformers are essential components for expanding the electrical grid, enabling the reliable transmission of electricity over long distances and helping to stabilize connections between regions.
Tim Holt, Executive Board Member at Siemens Energy, says 'The energy transition in the United States is in full swing, with US$3,9 billion committed to expanding and upgrading the electrical grid over the next two years. However, renewable energy projects and the expansion of the electrical grid can only occur through the availability of transformers.
The North American market today is predominantly served by the Americas and Europe, but as global demand for this crucial technology increases, we see the long-term potential to expand our presence in the United States by leveraging our long-standing presence in Carolina do Norte, where we have operated since 1969.
In Charlotte, North Carolina, Siemens Energy will expand existing operations by building its first transformer production facility in the United States, which will provide vital infrastructure to enable the country's energy transition.
With the United States seeking to reduce emissions by 50-52% by 2030 from 2005 levels, the race to decarbonize the country's power grid is underway, but this can only realistically be achieved through the availability of transformers.
Studies predict that 25% of global renewable energy projects are at risk due to long lead times for transformers, supply chain bottlenecks and lack of global production of these components. Siemens Energy's investment will address these challenges and increase domestic transformer production in the United States.
In addition to the company's investment, the project will also be supported by a Job Development Investment Grant (JDIG) from the state of North Carolina. Governor Roy Cooper announced the grant following its approval by the state Economic Investment Committee.
Current energy challenges demand flexible solutions for the electrical grid and transformers capable of dealing with increased demand and fluctuations that affect grid stability. Siemens Energy has been manufacturing power transformers for more than a century, and its current line delivers capacities in excess of 1.000 MVA and 1.100 kV.
Construction of the factory will begin this year, with the first transformers scheduled to be manufactured in early 2026.
Source: © Siemens Energy
