If you’re a metal recycler, demolition expert, or electrical contractor you’ve likely run into surplus transformers on the job site or had someone try to sell you their old transformer. In these situations you’ve probably wondered, just how much are these green and gray electrical boxes actually worth?
If you’ve received old transformers in the past, you might have cut them apart and sent them to a recycler for the value of the scrap aluminum and copper. But, dismantling transformers can be a hassle, and the return for scrap aluminum and copper is not what it once was. Or, you may have left the unit sitting in storage somewhere where it is now taking up space that you need to use for something else. There’s a better way to deal with used transformers. Rather than spend needless hours scrapping a unit or allowing it to gobble up useful storage, you can sell your transformer for 5 times or more its scrap value for reconditioning. In this article, we’ll explore how to get more money for your old transformers.
First, let's look at what surplus transformers are and what your options are for getting rid of them.
What is a surplus transformer?
A surplus transformer is any transformer not currently in use by its owner. It can either be a transformer that was decommissioned because it was old or no longer needed, or it can be a unit that was bought for a project or as a backup and never used.
What should you do with surplus transformers?
If you run into one of these surplus transformers or currently own one of them, you have several options. You can either keep it as a backup in case one of your other transformers fails, you can get it repaired, you can sell it to a recycler to scrap, or you can sell it to a reconditioner like Maddox to upcycle. Let’s look at each of these options in more detail.
Keep your surplus transformer as a backup
In some cases, it may be best to keep your surplus transformer as a backup unit in the event that your other transformers fail, especially if you are running a mission-critical project. Lead times for new transformers are stretching out months and in some cases even years, meaning you may have to wait a very long time before you can get a new unit to replace the one you lost.
If you want to keep your transformer as a backup but it needs some repairs to get it back in working condition, Maddox can repair your transformer! We offer a full range of inspections, tests, and maintenance services, including complete coil repair and replacement, weld repairs, complete oil sampling and analysis, and replacement of any standard dry-type or oil-filled transformer components. To top it off, we’ll take care of any necessary fabrication repairs and give the unit a fresh coat of paint, so that the transformer looks just as good as it now operates.
If you don’t need to keep your surplus transformer as a spare, you can either scrap it or sell it to a reconditioner.
Scrap your surplus transformer
Transformers are composed of several raw materials including a steel cabinet or enclosure and aluminum or copper windings. Recyclers will buy surplus transformers to salvage these raw materials and then sell the materials to foundries. While scrapping your transformer usually means you get a payout, it is seldom the best option to follow if you own an electrically OK transformer. The payout for scrapping a unit is significantly lower than the payout for selling a unit to a company like Maddox for reconditioning. The best candidates for scrapping are units that have reached the end of their life cycle (or permanently damaged/failed), or an oil filled transformer which contains PCBs.
Sell your surplus transformer to a reconditioner
Your last—and most lucrative option—is to sell your surplus transformer to a reconditioner like Maddox. We will buy your transformer, recondition it, and redeploy it out in the grid. This option has several environmental and financial advantages over simply scrapping your transformer for raw materials.
Financial benefit of recycling your transformer through reconditioning
If you have a surplus transformer you are looking to get rid of, you will usually make more money by selling this transformer to a reconditioner like Maddox than by selling it to a scrap company. At Maddox, we’re able to offer clients 2-5 times the scrap value for their transformers since we are able to recondition these surplus units and then sell them to customers in the market. This is a win-win scenario: we’re able to give you more money for your surplus transformers, and we’re able to sell them to customers for less than the price of new transformers.
Environmental benefit of recycling your transformer through reconditioning
Reconditioning a transformer is also the most environmentally friendly means of disposing of your transformer since this process doesn’t require the same high energy consumption and greenhouse gas emissions associated with both manufacturing new transformers and scrapping old ones. Reconditioning a transformer means that you are truly recycling the unit and reusing it.
How much is a surplus transformer worth?
If you have a surplus transformer you are looking to sell, you’re probably wondering how much you can get for it.
There’s no simple answer or easy formula to determine what the old transformer you have is worth. Here at Maddox, we have paid recyclers and electrical contractors up to hundreds of thousands of dollars for some substation transformers and have paid only a couple hundred bucks for some low-voltage dry-type transformers. The value of a specific transformer depends on several variables: transformer type, voltages, materials, age, location, the current market, etc.
Below is our step-by-step guide on how to get the most money out of your surplus transformers. Along the way, we’ll discuss the different variables that determine the transformer’s value.
Step 1: Understand if your transformer is electrically OK
The first step to determine how much your transformer is worth is to find out if your transformer is electrically OK (or “EOK”). The main factor in determining whether a transformer is EOK: is if it converts the input voltage to the correct output voltage as specified on its nameplate within tolerance per IEEE Std C57.
How to test your transformer
We use a transformer turns ratio, insulation resistance (sometimes called a megger test), and winding resistance test to see if the surplus transformers we buy are in good working order. For liquid-filled transformers we also use an oil test to see if your transformer has PCBs or has any other internal problems.
What if you don’t have the time or resources to test your transformers?
Now, if you are a recycler or demolition contractor, you likely have neither the equipment nor time to test all the transformers that you get opportunities to buy. So how do you know if your transformer is electrically OK? One way is to check if the unit was operational when it was decommissioned. If it was working correctly before removal, it’s likely that the transformer is still in working condition and will be worth a whole lot more than scrap value.
Here at Maddox, we realize that you probably don't have the time or resources to test all the transformers that you come across, so we’ll gladly test your transformers for free. If you have a transformer that you want to sell, we’ll make you a purchase offer contingent on the electrical and oil test results. Upon your acceptance of the offer, our team will pick up the transformer from your facility and will ship it to one of our testing facilities, free of charge. If the transformer passes the tests, our team will pay you the full offered amount. If the transformer fails testing, we’ll give you two options: 1) we’ll offer the scrap value for the transformer, or 2) we can ship the transformer back to you free of charge and you can scrap it yourself.
The testing process only takes 7-10 business days from the time our testers receive the transformer.
Step 2: Check your transformer specs
If your transformer is electrically OK, the next step is to determine what the specifications are on your transformer. All of this information is already on the transformer nameplate, the metal or plastic placard inside the cabinet door or attached to the outside of the unit. Send our team a photo of your transformer’s nameplate and our team will be able to check the unit’s age, type, kVA, and voltages. All this information allows our team to get you an accurate offer for your surplus transformer.
Step 3: Get an offer and get your transformer picked up
After determining your transformer’s specs, you’ll need to get an offer from either a transformer reconditioner or scrap yard that you trust to buy your unit.
After accepting an offer, you’ll need to arrange the pickup and delivery of your transformer. At Maddox, we handle all the logistics and environmental factors for free when we pick up clients' surplus transformers. We also have shops across the country, which makes shipping these units quick and easy.
Step 4: Get Paid
The final step—and the most important one—is getting you paid for your surplus unit. At Maddox, it usually takes about 14 business days between when we receive your transformer and when we issue your payment. This time period allows our team to do all the necessary tests to ensure your transformer is in working order. Once again, the quicker you’re able to get the units ready for pickup, the quicker you’ll get paid.
If you’re a demolition contractor, recycler, or electrical contractor we’d love to buy your surplus transformers. We offer you 2-5 times the scrap value you would get for your transformers, and we’ll take care of all the transportation and logistics. We buy thousands of transformers each year and are happy to review any surplus transformers you are looking to get rid of. Contact us today and turn your old equipment into cash!