Heathrow Shutdown Shows How Electrified World Depends on Transformers

Mar 31, 2025

A shortage of transformers is causing delays to power projects everywhere, holding trillion-dollar industries hostage—and that was before tariffs.

By Akshat Rathi, Naureen Malik and Tiffany Tsoi Photography and video by Tom Skipp

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An explosion, a fireball and then darkness: Heathrow Airport uses as much energy as a small city, and when a major fire at a substation caused the power to fail late Thursday, the world learned how fragile our infrastructure can be. At the center of the chaos was a burning electrical transformer.

The transformer is rarely considered as a linchpin of today’s technologically interdependent world, let alone as a key to the even more electrified future. But it’s a device that’s essential to powering almost everything, and these days it’s not that easy to obtain. Replacing Heathrow’s charred transformer — or the countless others destroyed in storms, fire and floods on an increasingly volatile planet — will not see a quick fix. “There is a lead-time of over a year for a new transformer of this size,” says Conor Murphy, vice president of engineering at grid-technology firm Novogrid.

The astonishing Heathrow shutdown — leading to more than 1,000 canceled flights — traced back to a single point of failure is only the latest chapter of a story playing out all over the world. Without a transformer, projects of all kinds end up delayed with cascading consequences. In Europe, the shortage has throttled the buildout of cheap renewables, just as an energy crisis hit that caused electricity prices to spike.

In the US, the lack of transformers has slowed down recovery in the aftermath of extreme weather. It took seven months for businesses in the industrial corridor of eastern Tennessee hit by Hurricane Helene last year to resume their full power consumption.

At the other end of the state, meanwhile, transformers are causing headaches for tech companies that need new power-hungry data centers for artificial intelligence. The rise of a massive complex for Elon Musk’s xAI startup in Memphis, Tennessee, has forced a regional utility to go begging its peers for spare transformers to avoid delays.

This is the first story in Bottlenecks, a series examining the many obstacles slowing the transition to a cleaner, more electrified future.

Even comparably low-tech projects can end up hamstrung for want of a piece of equipment that’s been in widespread use for more than a century. In Houston, a project to construct 16 duplexes, where young adults fresh out of foster care move in and learn to live independently, spent a year and a half on hold before reaching completion last June. The cause was a missing transformer.

“You can’t build on a generator,” says Carole Brady, executive director of nonprofit HomeAid Houston. “It was holding up aid to young adults who were literally in trouble.”

The Covid-19 pandemic strained many supply chains, and most have recovered by now. The supply chain for transformers started experiencing troubles earlier — and it’s only worsened since. Instead of taking a few months to a year, the lead time for large transformer delivery is now three to five years. Among a basket of 47 goods needed to build grid infrastructure, transformers have seen the greatest increase in price — a near doubling since 2018, according to JPMorgan Asset Management.

“We are trying to solve for the unknown constantly,” says Kevin Doddridge, chief executive officer of Mississippi’s Northcentral Electric Cooperative. It was his company that helped out another utility in a pinch to accommodate the xAI data center, trucking spare units 60 miles south to Tallahatchie Valley Electric Power Association.

Transformers change voltage and make electricity safe to use. They can be as small as a household trash can or as large as a shipping container. They dot the landscape of every part of the inhabited globe, even in most places with insufficient access to electricity. Most people ignore them. Yet when it comes to making the grid work, these janky metal boxes with odd-shaped ceramic parts jutting out are as irreplaceable as electrical cables.

“It was holding up aid to young adults who were literally in trouble.”

A bottleneck around the global supply of transformers spells trouble for sustaining infrastructure we have, from airports to homes, and for expanding emerging technologies we want such as AI as we enter the “age of electricity” as the International Energy Agency calls it. But the constraint is most ominous for what it will do to slow the necessary transition to clean energy, the best solution to rising temperatures.

Global average temperature last year breached 1.5C above pre-industrial levels, the first threshold identified in the 2015 Paris Agreement. Electrification is one of the most powerful ways to tackle climate change and prevent warming far past 2C, the fallback target set out by Paris. Electrical devices are more efficient than fuel-burning furnaces or combustion-powered cars, and the vast majority of new electricity generation being built around the world is carbon-free.

Electrification is also critical for economic growth. To a distressing extent, it’s not just widely discussed political issues but also hidden bottlenecks such as a scarcity of transformers that are holding back the energy transition more than a lack of money or the wait for breakthrough technologies that haven't been developed yet.

The device everyone ignores is holding back electrification

Illustration by Brown Bird Design

① Copper windings for high-voltage and low-voltage lines ② Ceramic bushings to move electricity in and out safely ③ Storage for oil used in heat management ④ Protective external case ⑤ Steel core that helps concentrate magnetic fields

Illustration by Brown Bird Design

North America and Europe, where demand for electricity has remained flat or declined for the past few decades, are now starting to see an increase instead with the rapid rise of AI, combined with growing sales of electric cars, heat pumps and air conditioners. But the supply chain for grid components in those regions only exist for the sleepy business of replacing broken or aging infrastructure. Now, for the first time in a long while, these supply chains need to readjust and grid companies need to build for growth.

That creates constraints with no quick fixes. Global electricity demand is rising so fast that even in India, which has seen a 10% annual increase in electricity production this century, delivery times for transformers have doubled in the past year.

The country will continue to heavily rely on imports even as domestic manufacturing capacity increases

Transformers aren’t like solar panels or smartphones. Often they have to be designed to narrow specifications that fit a precise location on the grid. One study found that the US alone has 80,000 varieties of small transformers — that’s likely more in number than every unique car model ever made.

President Donald Trump’s tariffs are adding to the headaches. The US imports more than 80% of large power transformers annually, mostly from Canada and Mexico. Tariffs on some metals and threats of additional tariffs are fueling uncertainty at a time when companies need secure supply chains to invest in manufacturing.

The sector’s long list of problems and the lack of easy solutions mean that the supply-demand gap will not be bridged soon. “It’s going to be a long battle,” says Benjamin Boucher, senior analyst for Wood Mackenzie. “It’s not something that can be solved in the next five years.”

So how did we get to a point where one component can hold trillion-dollar industries hostage? Turns out, a quirk of history made the entire world’s electricity systems reliant on transformers.

At the end of the 19th century, when electricity was just starting to become a commercial source of energy, two businessmen fought to control its future in what came to be known as “the war of the currents.” Thomas Edison promoted the use of direct current (DC) and George Westinghouse, inventor and industrialist, was convinced that alternating current (AC) would prove more practical.

In a clash of personality, finance and some genuine technical advantages, Westinghouse won out and the world has been mostly stuck with using AC as a means of generating and transmitting electricity. Transformers are necessary to make the AC system work.

Transformers act as a kind of regulator for electrons: They change AC voltage at which electricity flows to help it travel long distances and keep the system safe.

If you have ever looked at the fine print on a phone charger, it will usually mention two key variables: voltage and current. You can think of voltage as the height of the waterfall and current to be the amount of water flowing over the fall. The transformer sits between two AC power lines and either increases or decreases the electrical voltage depending on what the grid needs. Get the voltage wrong, and you can end up frying an electrical device or causing a blackout.

But voltage management is also crucial in efficient transport of electricity. With current technology, more than 10% of electricity is lost when moving it from a power plant to the consumer. Without transformers helping change the voltage, that loss — just over tens of miles of wires — could be as high as 100%, rendering electricity an unusable form of energy on a large scale.

A solar or gas plant typically generates power at a few hundreds or thousands of volts. That’s increased to hundreds of thousands of volts using a step-up transformer. The increase in voltage helps electricity travel tens or hundreds of miles without too many losses. But before it can be used to charge your phone, the high-voltage power has to go through a series of step-down transformers that bring electricity to your home at about 100 or 200 volts.

Transformers are needed at each node of the grid. The Department of Energy estimates there are as many 80 million small power transformers in the US — one for every four residents.

If they are so crucial and widely distributed, how come there’s a shortage? The answer lies in the special materials transformers need, their complex manufacturing process and the risk-averse industries that buy and sell transformers.

GE Vernova’s factory in Stafford, England, is one of the few transformer factories in the world that’s expanding. By the end of 2026, its staff will grow by 50% and the number of transformers produced will have doubled. It’s also the only remaining factory in the UK making large power transformers.

Finding staff for the factory floor isn’t hard, but securing engineers for tasks like design remains a challenge. Over the past few decades, talented students sought jobs in tech, says Neil Beardsmore, global commercial lead for GE Vernova’s grid integration solutions. “But now it’s swinging to the energy transition,” he says, as he sees significant growth for the first time. “So we’re trying to make our industry sexy again.”

A large power transformer, foreground, at the GE Vernova factory. This site in Stafford, England has been home to a factory making mostly electrical devices for more than 120 years.

Today it makes very large power transformers that are linked to offshore wind turbines or undersea cables.

The Stafford factory makes very large power transformers, which are used by grid operators and are often necessary to bring in power from offshore wind farms or connect high-voltage undersea cables between regions. They can handle a huge amount of power and weigh 300 tons. That’s as much as two blue whales. But in a far smaller, denser package. Imagine 10 standard shipping containers filled to their limit and crushed into the size of half a single shipping container.

A very large power transformer can be so dense that it has to be transported on an “abnormal load engineering” vehicle that’s tens of meters long and has more than 100 wheels, with two full-sized trucks pushing the vehicle ahead from either end. “When we ship one of these transformers, we actually have a police escort all the way to the port,” says Michael Graham, manufacturing lead at GE Vernova. The nearest port, Ellesmere, is about 40 miles from the factory.

Inside a transformer — regardless of its size — are the same major components. Two cores of tightly wound copper cables are set up on a steel structure. “The technology used to build modern transformers is already more than 100 years old,” says Stefan Tenbohlen, professor of electrical engineering at the University of Stuttgart. “It’s not rocket science.”

The way transformers change voltage relies on the most fundamental law of electromagnetism discovered: a change in an electric current in a wire creates a magnetic field. The reverse can happen too, where a change in magnetic field can create electricity in a wire.

A transformer combines that reversibility into one device. The steel structure helps contain the magnetic field, and it does so more effectively if manufacturers use grain-oriented electrical steel (GOES). But making it is a delicate process and it’s not widely produced.

About a third of the weight of a transformer is thin insulated sheets of GOES that are used to build the core. The UK has no plant that makes it, which means GE Vernova has to import GOES from mainland Europe or Japan. The US relies on the last remaining GOES factory in North America, located in Pennsylvania and owned by Cleveland-Cliffs Inc. Even that plant doesn’t make the highest-grade GOES that’s used in most large transformers today.The manufacturing is also intricate. “There are thousands of parts in a transformer,” says Eduardo Villar, operations manager at GE Vernova. Each one has to be prepared to a high specification and reliability because it’s not economical for grid operators to have spare ones, which can be swapped out if a big transformer goes bust.

Following the completion of its expansion, GE Vernova’s Stafford factory will make 36 transformers a year from 2026 onward and supply the UK’s National Grid and other big grid operators around the world. That may not sound like a lot, but it’s because large power transformers are built to order. “It’s not volume manufacturing,” says Villar. “We’re not making bottles.”

It’s not always possible to repair a transformer. And yet it’s often so crucial to the grid — like tires are to a car — that a replacement be available immediately to keep things functioning. In an era of more extreme weather, that means utilities and others are dependent on this constrained supply chain if a hurricane wrecks transformers. With shortages growing, some utilities are buying more transformers than they need — so they can have backups at the ready in the event of a disaster.

In eastern Tennessee, Erwin Utilities was able to replace broken transformers damaged by Hurricane Helene. But only because it had planned ahead. Seeing the supply crunch over the past few years, the company slowly doubled the inventory of small transformers it kept in storage. That made it possible to get services back up soon after the storm. “It sure ties up your financial resources,” says Lee Brown, chief executive officer of Erwin.

In principle, it should be possible to overcome many of these challenges and increase the production of transformers given there is such a demand for the product. But previous boom and bust cycles have made industry executives question whether such elevated demand will persist long enough to pay for the heavy investments needed to build new factories.

The shortage of this key electrical component is slowing down electrification and adding to cost of projects

That’s particularly true in the US. Eva Gonzalez Isla, researcher for grids and utilities at BloombergNEF, says that transformer companies made investments in the early 2000s to expand manufacturing capacity in the US while anticipating a rise in electricity demand. Then came the financial crisis of 2008, after which electricity demand did not bounce back quickly. Many companies were unable to recover their investments.

Now those firms are seeing a rise in demand for transformers alongside the buildout of data centers for AI, but remain unsure if the trend will continue, says Gonzalez Isla. “Transformer companies aren’t going to open new plants only to shut it down after 10 years of business,” she says.

Limited supplies of GOES, the special steel used in transformers, is also a major concern before manufacturers can commit to building a new plant, especially in the US. It’s possible to use other kinds of steel to make transformers, but resistance to change means new materials are rarely adopted.

The Department of Energy looked to mandate that the industry start shifting over to amorphous steel, which is supposed to make transformers more efficient. But rules faced an industry backlash, because replacing such a crucial material would incur upfront costs to incorporate necessary design, process and supply chain changes. When the new rules were finally issued last year under former President Joe Biden, they allowed for transformers to keep using mostly GOES.

There is plenty of room for technology improvements to transformers and some companies have deployed their small research budgets and taken advantage of government research grants to find new solutions. GE Vernova has shown that it’s possible to make flexible large power transformers, which could reduce the number of varieties that need to be made. Siemens Energy AG has built rapid-response transformers that can act as backups until a full-fledged transformer is ready. And Avangrid Inc. has made mobile transformers that can be trucked to solar or wind projects in a couple of months.

Large power transformers are dense and very heavy.

Moving GE Vernova's large transformers using public roads requires special vehicles and a security escort.

There are also technologies available to completely rethink this device that hasn't fundamentally changed in over a century. That's the thought behind solid-state transformers, which use the latest developments in electronics. The approach can drastically shrink the size of transformers and make it possible to avoid custom design for each application. Crucially, solid-state transformers will be able to communicate with grid operators, which standard transforms cannot. That could help avoid the type of accident Heathrow experienced. But they are still far from being commercially available.

It was a sniper attack in 2013 that alerted US officials to the fragility of the grid and the crucial role of the transformer. On April 16, shooters fired rifles at the Metcalf substation near San Jose, California. That created holes in the external casing and caused the cooling oil to leak. Within minutes, overheating led to the shutdown of 17 transformers. If the utility hadn’t found an urgent way to re-route power, Silicon Valley could have gone dark.

The incident set off a firestorm in the power industry. The chairman of the Federal Energy Regulatory Commission at the time of the attack called it “the most significant incident of domestic terrorism involving the grid that has ever occurred.” While the perpetrators were never caught, utilities began to beef up security around substations and some started to stockpile the most important transformers.

“We have begged, borrowed and pleaded with other utilities in the Tennessee Valley to get transformers.”

Clearly, there’s a lot more to be done. On Friday at Heathrow, some 25,000 liters of a transformer’s cooling oil were “fully alight,” according to the London Fire Brigade. Firefighters worked more than seven hours to bring the fire under control, while Heathrow airport rejiggered its system to accept power from other substations to restart operations.

And it’s not just national-security issues that have made transformers more important. Climate-driven extreme weather events add a new layer of risk. A few years ago a violent tornado ripped up 400 homes and 137 businesses in a Kentucky town. Rebuilding was getting delayed by a shortage of transformers. With no government help or technological miracles showing up, Marty Ivy, general superintendent at Mayfield Electric & Water Systems, got creative. “We have begged, borrowed and pleaded with other utilities in the Tennessee Valley to get transformers,” he says.

Given the risk-averse nature of the industries involved, it’s not wise to rely on technological advances to help solve the immediate bottlenecks. But that’s where governments can help and the story of two transformer plants shows how.

In 2017, electrical-equipment maker ABB shut down its transformer factory in St. Louis, Missouri, because there wasn’t enough consistency in demand, according to Travis Edmonds, North American head of supply chain management at Hitachi Energy, which is now the owner of ABB’s transformer business. (The factory remains closed).

The fortunes for Hitachi Energy’s transformer factory in Quebec, Canada, were the opposite. That factory is growing in size, and Edmonds says that’s because the Canadian government is backstopping local utilities that buy transformers. The idea is that governments can guarantee purchases of transformers, which gives manufacturers the certainty to invest in new factories. The German government provided similar commitments more recently following the energy crisis caused by Russia’s attack on Ukraine.

"In a fragile world and in a sort of complex investment climate, you might just sort of say: 'We're happy to have full order books. Why would we go even further?'" says Kristian Ruby, secretary general of Eurelectric, which represents businesses in the grid industry.

China, on the other hand, has been growing transformer manufacturing for years that feeds both its growing domestic electricity demand and rising export needs. In the west, Canada and Germany are exceptions. Many countries want to increase domestic supplies of transformers, but most aren’t willing to put taxpayer money to make it happen. It’s not something that Wood Mackenzie’s Boucher expects the US government to do either.

Instead, Trump’s tariffs on steel have already led to an increase of 20% in transformer prices, says Boucher. Most transformer contracts link up the price to commodity prices, which means the tariffs are likely having an immediate impact on transformer buyers.

There hasn’t been a focus on investing in the supply chain for making transformers over the past 20 years, and shortages are likely to get worse. “That’s really coming back to bite us,” says Boucher.

Assists: Olivia Rudgard, Mark Chediak and Dan MurtaughEditors: Emily Biuso, Aaron Rutkoff and Amanda Kolson HurleyPhoto and video editor: Jody MegsonArt director: Somnath BhattSpot illustrations: Benny Douet