Why further energy efficiency in medium power transformers still makes sense
This article debates the opportunity and pertinence of a potential increase of minimum energy performance standards (MEPS) for medium power transformers in Europe.
In 2014, the EU introduced minimum energy performance standards (MEPS) for three-phase, liquid-immersed power transformers with power ratings between 1 kVA and 3150 kVA, used in electricity transmission and distribution networks or for industrial applications (Commission Regulation (EU) 548/2014). As a first step, the regulation introduced the Tier 1 maximum load losses and maximum no-load losses for the transformers under scope, which came into force on 1 July 2015. In 2019, this regulation was amended (Commission Regulation (EU) 2019/1783), leading to more stringent maximum loss values (Tier 2) coming into force on 1 July 2021. In 2023-2024 a revision of the regulation has been launched, aiming to address a number of aspects listed in Article 7, including energy performance.
In this context, International Copper Association Europe has carried out a modeling exercise (see this public article and this post) for the analysis of possible design options for medium power transformers meeting efficiency levels above the current Tier 2 requirement.
The main finding is a savings potential of 1.8 TWh per year, which deserves full consideration in the context of the Ecodesign for Sustainable Products Regulation, and even more looking at objective to reduce 11.7% the EU energy consumption by 2030, as established by the Energy Efficiency Directive.
Here below are the main evidence-based findings of this exercise, which lead to the conclusion that Tier 3 efficiency level should be considered and analysed as a design option in the review of the transformers regulation.
1) Amorphous steel is not required
In our modeling exercise Tier 3 has been set at Tier 2 minus 10 percentage points (A0-20%, Ak-10%). Such Tier 3 level can be reached using conventional steel grades (M070), without any need of amorphous steel.
2) Tier 3 is not more costly than Tier 2
Previous regulations already assessed the increase in upfront cost of more efficient transformers, but such increase was confronted against the savings in losses over the lifetime of the transformer (higher capex in exchange for lower opex). A Total Cost of Ownership (TCO) analysis was carried out in previous exercises. In this occasion, our model finds that TCO is not impacted by the transition from Tier 2 to Tier 3.
3) Higher energy performance doesn't result in more material consumption at system level
Exactly in the same manner as for costs, we need to confront the additional material used in the transformer with the materials saved through lower losses. A Total Cost of Ownership for materials has to be performed. On the one side, more efficient transformers are usually heavier and bulkier (apart from situations where aluminium winding designs can be shifted to copper winding designs, in which case weight and size are reduced, thanks to the higher conductivity of copper). But on the other side, we need to account for the materials in generation and transmission assets saved, as energy losses are avoided.
Let’s remind that 1 kWh/year wasted in energy losses requires the use of 0.75 kg of materials, of which 0.15 kg of metals (see full analysis here). In the case of medium power transformers, shifting from Tier 2 to Tier 3 represents an opportunity to save 1.35 Mton of materials, of which 270 thousand tons of metals at EU level, associated with the 900 MW of generation assets that are avoided (such capacity would be needed to produce 1.8 TWh/year, on the basis of the projected EU generation mix as per the Green Deal Impact Assessment).
While at the level of the transformer itself more materials would be needed, indeed, a reduction in energy losses translates into a reduction of material use in power generation and in the power grid upstream from the transformer. The net material balance at system level of Tier 3 MEPS is practically neutral, even slightly more positive than Tier 2.
We could enter into considerations of whether all materials can be judged the same. Indeed, some are defined as more "critical" than others, notably attending to their supply risk and their economic importance (see the European Commission latest study). On this point, it is worth to mention that the European Commission is carrying out an Ecodesign preparatory study for product specific measures on scarce, environmentally relevant and critical raw materials and on recycled content. The most relevant products from a critical raw material (CRM) usage viewpoint have preliminarily been ranked, as follows: 1. Personal computers 2. Enterprise servers & data storage 3. Light sources 4. Cooking appliances 5. Photovoltaic panels and inverters 6. Electronic displays 7. Imaging equipment 8. Household refrigeration 9. Local space heaters 10. MCPT. There are several products where the use of CRMs is planned to be addressed in priority, but transformers are not in this list. Indeed, even if steel, aluminium and copper are used in transformers, their criticality is significantly lower than other CRMs used in other product categories, notably in power generation, such as photovoltaic panels or wind generators using rare earth permanent magnets.
Therefore, from a critical raw material perspective, materials are best used in more efficient energy-consuming devices, which allow to spare electricity generation capacity, than the other way around (additional generation assets to compensate the losses of less efficient devices).
4) The supply chain is investing in capacity expansion, current delays are expected to significantly improve from 2027 onwards
The increase in demand for transformers due to fleet renewal and electrification has strained the market. However, regulation wise, the situation that matters is not the current one but the one in the years to come, once the revision of regulation enters into force.
Transformers Magazine has carried out a comprehensive survey over a representative sample of manufacturers and value chain companies, finding that:
From a Net Zero Industry Act perspective, which aims to improve the autonomy of the EU in terms of strategic industries for the energy transition, it makes more sense to support the consolidated EU transformers value chain than increasing imports of PV panels, where the external dependency rate is extremely high. Here again, supporting more efficient energy-consuming devices is the best option.
5) Regulatory concessions are granted to cases where installation costs are disproportionate
As mentioned above, Tier 3 MEPS generally increases the weight and size of the transformer, which in some cases may trigger collateral investments, potentially leading to excessive costs which don't justify the adoption of Tier 3 designs.
This is true for some brownfields, but much less so for greenfields, or even for brownfield cases where the required increase in transformer capacity demands for a new substation anyway. This question merits an analysis to quantify the percentage of situations where size and weight constraints actually lead to disproportionate additional costs. And in those particular situations, the existing concessions for cases where installation costs are disproportionate can still be applied (Annex I-3 of (EU) 2019/1783 regulation), though some practicalities in its implementation still need to be clarified (role of the user in determining the situations that lead to excessive installation costs).
As a conclusion
According to the analysis carried out by International Copper Association Europe , there is room for futher improvement of the energy performance of medium power transformers. This article brings evidence-based arguments proving that all the conditions are met to consider Tier 3 as a design option in the review of the current regulation.
Ecodesign has the power to shape the landscape for critical raw materials and external dependencies. Lacking ambition and action at Ecodesign level leads to the unwanted effect of an increased dependency on more critical raw materials and foreign technologies.