United States Transformer Market Size and Forecast 2025–2033

United States Transformer Market Overview

The United States Transformer Market is projected to grow from US$ 19.95 billion in 2024 to US$ 33.25 billion by 2033, expanding at a CAGR of 5.84% during 2025–2033, according to Renub Research. This growth trajectory reflects the critical role transformers play in ensuring a reliable, efficient, and future-ready power system amid rising electricity demand, large-scale grid modernization, and accelerating investments in renewable energy and electrification.

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A transformer is a core electrical device that transfers electrical energy between circuits through electromagnetic induction, enabling voltage to be stepped up or down without changing frequency. This function is fundamental to power generation, long-distance transmission, and safe distribution across residential, commercial, and industrial applications. From large substations and power plants to urban distribution networks and EV charging hubs, transformers underpin the entire electricity value chain in the U.S.

As the nation upgrades its aging grid, integrates intermittent renewable energy sources, and electrifies transportation and industrial processes, transformer demand is expanding across all power ratings, cooling types, and application segments. Distribution transformers dominate urban and residential networks, while power transformers remain indispensable for high-voltage transmission over long distances. At the same time, the rise of smart grids is accelerating adoption of digitally enabled, energy-efficient, and environmentally friendly transformer technologies.

United States Transformer Market Growth Drivers

Grid Modernization and Infrastructure Renewal

One of the strongest drivers of transformer demand in the U.S. is the urgent need to modernize an aging power grid. A significant share of installed transformers has already exceeded its designed operational life, increasing the risk of outages, inefficiencies, and safety concerns. Federal and state governments, along with utilities, are committing substantial funding toward grid renewal, including replacement of legacy transformers and deployment of smart grid solutions.

Advanced transformers equipped with remote monitoring, automation, and predictive maintenance capabilities are becoming essential for utilities transitioning toward digital and decentralized power systems. Estimates suggest that replacing outdated grid infrastructure could cost hundreds of billions of dollars over the coming decade, positioning transformers as a cornerstone investment in ensuring grid resilience and reliability nationwide.

Growth of Renewable Energy Integration

The rapid expansion of wind, solar, and other renewable energy sources is reshaping the U.S. electricity landscape. Unlike conventional generation, renewables are often decentralized and variable, requiring transformers capable of handling bidirectional power flow, voltage fluctuations, and grid stabilization. This has increased demand for both conventional and next-generation transformers designed specifically for renewable integration.

As the U.S. advances toward long-term decarbonization and net-zero targets, large-scale solar farms, onshore and offshore wind projects, and energy storage installations will continue to rely heavily on high-performance transformers. These systems ensure efficient grid interconnection while maintaining power quality and system stability across regions.

Expansion of Electric Vehicle (EV) Infrastructure

The accelerating adoption of electric vehicles is placing new demands on local and regional power grids. High-capacity EV charging stations, particularly fast chargers in urban corridors and highways, require robust medium- and low-voltage distribution transformers to maintain voltage stability during peak loads.

Government incentives, private investments, and utility-led charging infrastructure programs are driving transformer installations in residential neighborhoods, commercial centers, and transportation hubs. Although policy adjustments may influence funding timelines, the long-term electrification of transportation remains a structural growth driver for transformer demand across the U.S.

United States Transformer Market Challenges

Supply Chain Constraints and Raw Material Shortages

Despite strong demand fundamentals, the transformer market faces persistent supply chain challenges. Shortages of key raw materials such as copper, electrical steel, and silicon steel—combined with logistics bottlenecks—have extended lead times and increased costs. Dependence on imported components further exposes manufacturers to geopolitical and trade-related risks.

These constraints can delay grid modernization projects and utility upgrades unless domestic manufacturing capacity and localized supply chains are strengthened over the coming years.

Environmental and Regulatory Compliance

Transformer manufacturers must comply with stringent U.S. Department of Energy (DOE) efficiency standards and Environmental Protection Agency (EPA) regulations related to energy losses, emissions, and insulating fluids. While these regulations promote sustainability, they also increase R&D and production costs.

Eco-friendly alternatives such as dry-type transformers and low-emission liquid-filled systems are gaining traction, but higher upfront costs may slow adoption among budget-sensitive utilities and smaller commercial users.

United States Transformer Market by Key Segments

United States Air-Cooled Transformer Market

Air-cooled, or dry-type, transformers are witnessing growing adoption across the U.S. due to their enhanced safety, low maintenance requirements, and environmental advantages. Widely used in hospitals, data centers, educational institutions, and commercial buildings, these transformers eliminate the risk of oil leaks and fire hazards.

Their compact design makes them ideal for space-constrained urban environments, while increasing emphasis on green building standards and energy efficiency is further accelerating their penetration across multiple sectors.

United States Power Transformer Market

Power transformers form the backbone of the U.S. transmission network, enabling high-voltage electricity transfer over long distances with minimal losses. Rising electricity consumption, expansion of renewable energy corridors, and interregional grid connectivity projects are driving sustained demand for large-capacity power transformers.

Utilities are increasingly investing in smart power transformers featuring advanced insulation materials, digital sensors, and real-time monitoring to improve reliability and asset management. As aging transmission assets are retired, this segment remains one of the fastest-growing in the overall market.

United States Three-Phase Transformer Market

Three-phase transformers are extensively deployed in industrial, commercial, and utility applications due to their efficiency in handling large electrical loads. Compared to single-phase systems, they offer lower losses and improved performance, making them ideal for manufacturing plants, data centers, HVAC systems, and high-rise buildings.

Continued growth in industrial automation, commercial construction, and digital infrastructure is reinforcing the importance of three-phase transformers within the U.S. power ecosystem.

United States Transformer Market by State

California Transformer Market

California stands at the forefront of clean energy adoption and electrification, making it a major growth hub for transformers. Ambitious renewable energy mandates, extensive EV infrastructure planning, and wildfire risk mitigation strategies are driving demand for resilient, high-efficiency transformer systems.

Urban density, high electricity consumption, and strict environmental regulations further support adoption of eco-friendly and digitally enabled transformers across both utility and commercial applications.

New York Transformer Market

New York’s focus on grid modernization, smart city development, and climate action is creating strong demand for advanced transformer technologies. The state’s transition toward a low-carbon electricity system requires extensive integration of renewables and energy storage, both heavily dependent on reliable transformer infrastructure.

Compact, low-noise, and environmentally friendly transformers are particularly in demand in dense urban areas such as New York City, supporting building electrification and public transportation upgrades.

New Jersey Transformer Market

New Jersey’s transformer market benefits from expanding suburban development, renewable energy investments, and offshore wind initiatives. Grid expansion and modernization programs are driving replacement of legacy transformers with digitally enabled systems that enhance reliability and resilience.

Rising EV adoption and distributed solar installations are further supporting steady demand for residential and commercial distribution transformers across the state.

Recent Developments in the U.S. Transformer Market

Major global and regional players are expanding capacity, investing in sustainability, and advancing digital transformation to meet rising demand:

Hitachi Energy announced significant investments to expand and modernize its transformer manufacturing facilities, targeting utility, renewable energy, and data center demand.

Siemens AG and technology partners have launched initiatives to digitally transform power utilities, improving grid management and energy transition readiness.

Siemens Energy has partnered on projects aimed at reducing transformer-related carbon emissions, including the use of recycled copper.

GE Vernova has expanded transformer manufacturing capacity to support growing HVDC and renewable transmission projects linked to the U.S. market.

These developments highlight a strong industry focus on capacity expansion, sustainability, and digital innovation.

Market Segmentation Snapshot

By Power Rating:

Large

Medium

Small

By Cooling Type:

Air-cooled

Oil-cooled

By Transformer Type:

Power Transformer

Distribution Transformer

By Phase:

Three Phase

Single Phase

Top 10 States:

California, Texas, New York, Florida, Illinois, Pennsylvania, Ohio, Georgia, Washington, New Jersey, Rest of the United States

Key Companies Covered:

ABB Ltd

General Electric Company

Schneider Electric SE

CG Power and Industrial Solutions Ltd

Hyundai Electric & Energy Systems Co. Ltd

Toshiba Corp.

Hyosung Corp.

Bharat Heavy Electricals Limited

Each company is analyzed across overviews, leadership, recent developments, SWOT analysis, revenue trends, and competitive positioning.

Final Thoughts

The United States Transformer Market is entering a decisive growth phase, driven by grid modernization, renewable energy integration, and widespread electrification of transportation and industry. While supply chain and regulatory challenges persist, sustained investments, technological innovation, and policy support continue to reinforce long-term market expansion.

With transformers serving as the silent backbone of the energy transition, their role in ensuring reliability, efficiency, and sustainability of the U.S. power system has never been more critical. As utilities and industries adapt to a cleaner, smarter, and more electrified future, the transformer market is set to remain a cornerstone of America’s energy infrastructure through 2033 and beyond.