T THE CANADIAN TRANSFORMER INDUSTRY: ASTRONGRECORDOFLEADERSHIP ransformers are a vital part of all electrical systems—they allow the transmission of electricity over long distances and transform energy into useable voltage levels for all parts of our economy. Virtually all electricity that is consumed passes through multiple transformers on its way to users. Canada has a long history of innovation and leadership in the Transformer market. Our expertise in the engineering and design of reliable, secure transformers that have supported electrical grids for decades, to developing employment opportunities for skilled trades in electrical wiring, high voltage testing, machining, welding, coil winding and insulation systems—hasadvancednotonlytheoverallCanadian electrical system but has drawn worldwide acclaim. Canada is widely recognized for its transformer expertise.Infact,Canadadesignedandmanufactured the world’s first 735kV and 765kV power transformers. This leadership has resulted in strong economic output by the industry. Today, Transformer manufacturerscontributesubstantiallytoCanada’sGDP, procured goods and services, capital and research investments, and employment. Moving forward, this market is positioned for growth, due to the need to replace aging infrastructure and the need to meet growing demand for new electricity generation in all regions across Canada. RETURNING VALUE TO CANADA: GROWTH OPPORTUNITIES Today, across North America, most installed transformers are approaching, and even exceeding, the end of their useful 25-to-40-year service life. In fact, it is not unusual to find transformers that were installed 50-70 years ago. While numerous “life extension” programs have been employed over the past two decades, the reality remains that this critical infrastructure needs renewal to ensure that we continue to benefit from a secure and reliable supply of electricity. In Canada alone, required capital expenditures in new electrical infrastructures, including transformers, are forecasted to exceed $350 billion over the next 20 years and total North American expenditures are forecasted at 10 times that amount.3 “Investing in infrastructure renewal is crucial for modernizing the electrical grid and meeting the evolving energyneedsofCanadians today—andforfuturegenerations tocome,”saidChannaS.Perera,VicePresident,Policy Development,CEA.“Successfullymeetingthischallengewould Photo courtesy of Northern Transformer DIDYOUKNOW? The world’s first 735kV and 765kV power transformers were designed and manufacturedinCanada. require sustainable, cost-effective, and innovative technology solutions.” An integral part of the Canadian electrical community, Transformermanufacturershavealreadystarteddeveloping smart, more energy-efficient and flexible transmission and distribution equipment that meets current and impending regulations in both Canada and the United States.4 This change will bring about significant energy and cost savings, will help reduce greenhouse gas emissions and lower overall environmentalimpacts. BARRIERS TO SUCCESS As promising as this outlook is, the Canadian Transformer industry and related suppliers face several challenges that require stakeholder attention. The barriers that require immediate attention include: • Tariffs: it is critical for the electrical industry to have continued access to raw materials at competitive prices to support Canada’s strategic interest to supply this critical infrastructure. The imposed tariffs pose a great threat to Transformer manufacturers’ ability to produce home-grown, secure and reliable electrical transmission and distribution equipment for the grid. 3 Canadian Electricity Association (CEA), Electric Utility Innovation: Toward Vision 2050, 2015: https://cea-ksiu6qbsd.netdna-ssl.com/wp-content/uploads/2017/05/ElectricUtilityInnovation-2.pdf 4 http://www.nrcan.gc.ca/energy/regulations-codes-standards/18318