# Generators and alternators: Correlation Prices it moves with, and why Source page: https://www.materialinsights.org/energy/e_generators/correlation/ Generator prices rest on copper windings, electrical steel cores, rare-earth magnets in some designs, and engineering labour. Orders follow power plant, wind and genset building. The index also covers motors, so it tracks broad electrical machinery costs. Price index **US PPI: motors, generators, motor generator sets** index · monthly, Jan 2006 to Sep 2026 #### What its price moves with Selected link ##### Generators and alternators and Copper Monthly changes -0.01 little or none correlation 12-month changes -0.07 little or none correlation Last 5 years -0.23 monthly changes Lead or lag +3 mo Copper tends to lead by 3 months (r 0.10) Price function, Jan 2006 to Sep 2026 Generators and alternators ≈ 5.84 × (Copper)^0.41 R² 0.33 On this fit, a 10% higher copper price goes with a 4.0% higher generators and alternators price over the long run. Units: index and $/mt. Chart: Generators and alternators and Copper prices rebased to 100 at Jan 2006, log scale Both prices rebased to 100 at Jan 2006, on a log scale so equal percentage moves look the same size. Chart: Generators and alternators price against Copper price, monthly, log scales, with fitted line Each dot is one month; paler dots are older (2006), darker dots recent (2026); the ringed dot is the latest month. The dashed line is the fitted price function. Both axes are logarithmic. Commodity [Cu Copper](https://www.materialinsights.org/commodities/copper/)Windings −0.01 Copper windings are a large share of material cost. The link hardly shows: both monthly and yearly correlations are close to zero, since the index moves smoothly while copper swings, and makers use surcharges and hedges rather than changing list prices. little or none co-movement month to month · 249 months Show charts Commodity [St Steel](https://www.materialinsights.org/commodities/steel/)Electrical steel 0.00 Stator and rotor cores are stacks of thin electrical steel sheet, and frames are steel too. Yearly moves correlate at 0.21 with the steel index, a weak link because electrical steel is a specialised grade with its own supply and price. little or none co-movement month to month · 249 months Show charts Commodity [REE Rare earths](https://www.materialinsights.org/commodities/rare_earths/)Magnet material Permanent-magnet generators, common in direct-drive wind turbines, use neodymium magnets. China dominates rare earth supply, so export limits can raise magnet costs, but rare earths have no public price series here and most large generators use wound rotors instead. Not enough overlapping price history to measure. Energy [ICE Internal combustion engines and gensets](https://www.materialinsights.org/energy/e_engines/)Combined product 0.30 Gensets pair an engine with a generator, and both come from similar heavy machinery factories. Monthly moves correlate at 0.30, and yearly moves more strongly, which reflects shared US manufacturing costs and demand rather than one setting the other's price. weak co-movement month to month · 249 months Show charts Energy [PE Transformers and power electronics](https://www.materialinsights.org/energy/e_power_electronics/)Grid connection 0.26 Generator output passes through transformers and converters to reach the grid, and both are ordered for the same power projects. Monthly moves correlate at 0.26 and yearly at 0.77, a common driver from grid investment and electrical equipment costs. weak co-movement month to month · 249 months Show charts Chemical [Pnt Paints and coatings](https://www.materialinsights.org/chemicals/paints_coatings/)Insulation and coating 0.30 Windings are insulated with resin varnishes and frames are coated against corrosion. These are small costs, but both indices follow US industrial inflation, so yearly moves correlate at 0.77 and monthly moves at 0.30, more a shared cycle than a direct input. weak co-movement month to month · 249 months Show charts How to read these numbers **Correlation of monthly changes** (the number in the coloured pill) compares how much each price moved, month by month, since 2006 or the first month both series exist. It runs from −1 to +1: near +1 the two usually rise and fall in the same months, near 0 there is no link, and a negative number means they tend to move in opposite directions. Above 0.7 is strong, 0.4 to 0.7 moderate, 0.2 to 0.4 weak. **12-month changes** compare year-on-year moves, which shows whether two prices share the same cycles even when the month-to-month noise differs. **Price function** is a straight-line fit of the two prices on logarithmic scales: price ≈ k × (partner price)^β. β is how much this price moves, in per cent, for a 1% move in the partner over the whole period, and R² is the share of the variation the fit explains. Two prices that both drift up with inflation can fit well without any real link, so read it together with the monthly correlation. **Lead or lag** checks whether the monthly correlation is clearly higher when one price is shifted by 1 to 6 months. Correlation is not cause. The reasons on each card explain the economic link; the numbers show how strongly it has shown up in prices. Proxy series are US producer price indexes or related prices and can blur the real link. Data: World Bank Commodity Price Data (Pink Sheet), October 2026; US Bureau of Labor Statistics producer price indexes, IMF primary commodity prices and US EIA prices via FRED, Federal Reserve Bank of St. Louis, retrieved November 2026. Calculations by this site. ## Other sections - [Summary](https://www.materialinsights.org/energy/e_generators/index.md) - [Overview](https://www.materialinsights.org/energy/e_generators/overview/index.md) - [Science and limits](https://www.materialinsights.org/energy/e_generators/science/index.md) - [Value chain](https://www.materialinsights.org/energy/e_generators/valuechain/index.md) - [Unit economics](https://www.materialinsights.org/energy/e_generators/economics/index.md) - [Engineering methods](https://www.materialinsights.org/energy/e_generators/methods/index.md) - [Equipment and suppliers](https://www.materialinsights.org/energy/e_generators/equipment/index.md) - [Relationships](https://www.materialinsights.org/energy/e_generators/links/index.md)