Delivery is Justice! Goldman Sachs: The aging American power grid is providing historic opportunities for Chinese power suppliers

The core contradiction in the construction of artificial intelligence infrastructure is shifting: from a simple pursuit of GPU quantity to a competition for the speed of power supply. Against the backdrop of "Time-to-Power" becoming the most severe bottleneck in AI construction, Chinese power solution providers with rapid delivery capabilities and large-scale production advantages are ushering in a historic opportunity for value reassessment.

According to news from the Chasing Wind Trading Desk, the Goldman Sachs team led by Jacqueline Du stated in a research report released on the 14th that the average lifespan of power grids in the United States and the European Union has reached 35 to 40 years. Faced with the explosive energy consumption demands of AI data centers (AIDC), infrastructure is becoming increasingly fragile. Currently, domestic power equipment capacity in the United States can only meet about 40% of local demand, and the waiting time for grid connection has extended to nearly five years. This supply-demand mismatch is forcing U.S. utility companies and data center operators to break traditional practices and begin accepting non-traditional suppliers to fill this long-standing supply gap.

This structural shortage is reshaping the pricing power of the supply chain. Goldman Sachs emphasized in the report that for qualified Chinese suppliers, their decisive advantage is no longer just low cost, but shorter delivery cycles. Driven by severe shortages, Chinese companies enjoy significant premiums in overseas markets compared to domestic sales, with premiums ranging from 10% to 80%, providing related enterprises with high profit visibility.

Based on this, Goldman Sachs has expanded its coverage of the AIDC power supply chain, focusing on companies that can solve the "power delivery" bottleneck. The bank believes that Chinese companies with advanced high-voltage direct current (HVDC) expertise, high-density power conversion capabilities, and mature OEM/ODM relationships will leverage this spillover demand for rapid expansion.

U.S. Power Bottleneck: Supply Gap Continues Until 2030

The power demand of U.S. data centers is experiencing explosive growth. Goldman Sachs predicts that by 2030, the electricity consumption of U.S. data centers (including AI and non-AI) will increase by about 175% compared to 2023, contributing approximately 120 basis points to the overall electricity demand in the U.S. and driving an average annual growth rate of 2.6%.

The power supply shortage is particularly severe in the United States. Goldman Sachs data shows that between 2025 and 2030, the effective reserve power capacity during summer peak periods in the U.S. is expected to decline further, while China's reserve capacity is expected to rise. Even if domestic power transformer suppliers complete their announced capacity expansion plans, they will only be able to meet about 40% of local demand by 2027.

On the generation side, gas turbines have become the bottleneck of bottlenecks. Goldman Sachs points out that about 60% of the power for AI data centers is expected to come from natural gas, due to its fast construction speed, stable output, and low carbon emissions, and it can generate power on-site to bypass grid restrictions. Major gas turbine manufacturers such as Siemens Energy, General Electric, and Mitsubishi Heavy Industries have order backlogs of 4.5 to 5 years, with Siemens Energy explicitly stating that its gas turbine capacity is sold out until 2028.

In the transmission and distribution segment, power transformers face the most urgent supply shortages. Siemens Energy predicts that the transformer shortage rate in the EU and the U.S. will be about 30% in 2025, and is expected to ease to about 10% by 2030 Due to the need for each transformer to be customized according to unique impedance, cooling, tap changers, overload, and seismic standards, the production process is labor-intensive and lengthy.

39% Compound Growth: 800V DC Architecture Brings Technological Upgrade Cycle

Goldman Sachs estimates that between 2025 and 2030, the overall addressable market for AI data center power products will expand at an annual compound growth rate of approximately 39%, covering seven major product categories including gas turbines, power transformers, uninterruptible power supply systems, server power supplies, electrical components, and liquid cooling systems.

This growth is supported by three main drivers: ongoing capacity construction, continuously improving power density, and the transition from AC-dominant to DC-dominant architectures. As the power of AI racks increases from 100kW to higher levels, even approaching 1MW, engineering complexity rises across rectification, protection, heat dissipation, and energy storage integration, creating a larger value pool for DC-ready components and grid-connected assets.

The 800V DC distribution architecture is becoming the standard configuration for most greenfield projects of AI data centers under construction, with some pilot projects exploring approximately 800V DC busbars. Goldman Sachs points out that compared to traditional AC topologies, adopting higher voltage DC distribution can save about 5-15% in energy consumption at the facility level. Key manufacturers such as NVIDIA have fully committed to the 800V DC architecture roadmap, and major ecosystem participants are aligning their product roadmaps towards DC-ready power conversion, protection, and battery energy storage system integration.

This architectural upgrade creates structural opportunities for suppliers of DC power infrastructure components. Goldman Sachs is particularly optimistic about Macro-Fair in the high-voltage DC relay sector and Jianghai in the capacitor sector, believing that existing AI data center-related orders have provided a more direct boost to their core businesses; as demand for duration increases, product portfolios should tilt towards higher specification high-voltage DC relays and supercapacitors (with double-layer capacitors growing first, followed by lithium-ion capacitors).

Delivery Speed Determines Success: Core Competitiveness of Chinese Suppliers

Goldman Sachs' analysis of eight key product categories indicates that for qualified Chinese suppliers capable of capturing spillover demand, the decisive competitive advantage is not only lower costs but, more importantly, shorter delivery cycles.

Faced with 3-5 years of waiting time for key components, data center operators and utility companies have made delivery speed a primary decision factor, which is sufficient to surpass preferences for historical suppliers. Although there are still challenges in global service capabilities, in the current supply-constrained environment, the value proposition of fast delivery combined with acceptable quality is highly persuasive.

Taking power transformers as an example, the short delivery cycle of Siyi Electric has enabled it to gain market share in the U.S. market. Goldman Sachs expects that the revenue share of the U.S. market in Siyi Electric's overseas revenue will grow from 26% in 2026 to 28% in 2028. Goldman Sachs notes that only a few Chinese companies can combine high quality with long-term commitment, navigating the market through rigorous certification processes, continuous upfront investments, and proven overseas performance records, and Siyi Electric excels in these areas In the field of gas turbine blades, Ingetec, as a leading domestic high-end precision casting manufacturer, currently holds less than 1% of the global market share, with significant growth potential. The company has signed long-term agreements with Baker Hughes, Ansaldo, and General Aviation. Goldman Sachs believes that Ingetec will benefit from the supply shortage of gas turbines, achieving growth as a supplementary supplier.

Pricing Power Emerges: Overseas Orders Enjoy a 10%-80% Gross Margin Premium

Due to severe supply shortages, Chinese suppliers can obtain significant price premiums ranging from 10% to 80% in overseas markets compared to domestic sales. Goldman Sachs pointed out that although production remains concentrated in China to maintain key delivery cycle advantages, the final profit margin improvement remains significant even when considering rising tariffs and logistics-related costs.

This opportunity is not universally available but is concentrated among a few top Chinese industrial enterprises that possess scale, quality control, and the ability to serve international customers. For example, in the case of power transformers, the gross margin of products sold by Siyi Electric in the United States is about 45%, while the domestic sales gross margin is about 30%; Huaming Electric's overseas sales gross margin is about 40%, while the domestic sales gross margin is about 25%.

In the uninterruptible power supply (UPS) system field, Kstar's overseas ODM model can achieve a pricing premium of 25-50% compared to domestic ultra-large customer orders. Goldman Sachs expects Kstar's overseas high-power electrical system sales to surge from RMB 100 million in 2025 (accounting for 2% of total revenue) to RMB 800 million in 2026 and RMB 1.782 billion in 2028 (accounting for 11% and 15% of total revenue, respectively), primarily driven by orders serving U.S. end-users for European customers.

Goldman Sachs estimates that under exposure to the U.S. market, the average sales compound annual growth rate for the company between 2025 and 2030 could reach 23%, while it would be 17% without considering the U.S. market. By 2030, the revenue contribution of these Chinese enterprises in the overseas AI data center market (mainly in the U.S.) is expected to average 23%, with an average global market share of 4%.

Product Priority Ranking: Gas Turbine Blades > Power Transformers > Electrical Components

Goldman Sachs has provided a clear preference ranking among categories of products related to China's power supply: Gas Turbine Blades > Power Transformers > Electrical Components > Uninterruptible Power Supply/Power Racks > Liquid Cooling Systems > Server Power Supplies.

Gas turbine blades rank highest due to their extremely high material science and manufacturing barriers—especially in single crystal high-temperature segment technology—and the severely limited effective global production capacity. Power transformers follow closely, benefiting from labor-intensive manufacturing and lengthy certification cycles. Electrical components benefit from strong demand visibility and broad exposure to AI and grid infrastructure construction, but due to easier scalability in manufacturing, they have smaller structural advantages in delivery cycles or differentiation.

Uninterruptible power supply/power rack systems benefit from differentiated ODM business models, allowing companies like Kstar to enter the U.S. market; liquid cooling systems also enjoy structural growth, with increasing quantity and content value as power density rises, but face relatively intense global competition. Server power supplies rank lowest because the product/scale gap compared to global peers remains significant, and rapid technological iteration brings uncertainty regarding technological disruption