The Evolving Role of Transformers in Data Centers

As the world’s digital footprint expands, data centers have become the core of the modern economy by housing AI, cloud, and enterprise workloads that power billions of daily interactions. Behind the rows of servers we associate with data centers lies a quieter but critical component: the electrical transformer.

In an era where a single, average hyperscale data center campus can draw over 150 MW of power, electrical infrastructure components such as transformers have become essential for to maintaining maximum uptime, while ensuring scalability and sustainability.

Rising Power Demands From AI-Driven Growth

In the last few years, data center energy demand has surged. Northern Virginia’s data centers consumed about 2.7 GW by 2022, more than the entire city of Seattle, and local grid operators expect that figure to double by 2040. A key factor in this demand is the rise of artificial intelligence and machine learning. AI-driven workloads such as large-scale model training and real-time inference require higher power density and continuous availability. These workloads accelerate infrastructure expansion and raise expectations for transformer efficiency and reliability.

Globally, this growth is fueling a major market expansion. The data center transformer market is projected to increase from $10.5 billion in 2025 to $20.7 billion by 2035, with a steady growth of around 7% CAGR. This expansion stems partly from the rapid growth of hyperscale campuses, colocation facilities, and edge sites, all demanding reliable, efficient, and high-capacity power conversion. Dry-type transformers, valued for their safety and low maintenance, are expected to make up nearly half of all installations by 2025. As data centers become denser, more distributed, and increasingly AI-driven, transformer innovation has become a central part of digital infrastructure strategy.

This shift makes it necessary to understand the different transformer types deployed to support data center infrastructure and their roles within these energy-intensive environments.

Types and Functions of Transformers in Data Centers

Transformers play a role at every stage of a data center’s power chain:

Large Power Transformers (tens to hundreds of MVA) connect campuses to the utility grid, stepping high-voltage transmission (115 kV–230 kV) down to 34.5 kV or 13.8 kV. Utilities now view 100 MVA transformers as standard for large campuses.
Medium-Voltage Transformers (1–5 MVA) distribute power across the campus, converting voltages to the 400–480 V range for IT and mechanical loads.
Distribution Transformers and PDUs deliver final voltages to racks and critical equipment.
Dry-Type Transformers, which are oil-free and safe for indoor installation, have become common at the distribution level. Recent projects have proven their scalability, including 22.5 MVA / 50 kV units recently deployed at a Dutch data center substation.

Together, these transformer units form the foundation of digital infrastructure, ensuring that every byte has a reliable path from the grid to the server.

Technical and Operational Best Practices

Transformer performance directly affects uptime, efficiency, and lifecycle cost. Best-practice design begins with accurate capacity planning and redundancy. Engineers balance load growth and efficiency, using N+1 or 2N configurations to maintain operation even if one transformer fails. Tier III and IV facilities typically implement full redundancy so that maintenance or replacement can occur without downtime.

Cooling and thermal management are equally vital. Oil-filled transformers use natural or forced-air systems (ONAN/ONAF), while dry-type units rely on fan-assisted ventilation. Overheating degrades performance and accelerates insulation aging, shortening transformer life. Modern monitoring through sensors that track temperature, vibration, and harmonic distortion enables early detection of anomalies. According to the Uptime Institute, 43% of major data center outages originate from power issues, showing the importance of proactive diagnostics.

Compliance with standards such as IEEE C57 and IEC 60076 ensures that transformers meet stringent electrical and safety requirements. These include noise shielding, seismic tolerance, and fire-safety enclosures, particularly for indoor or high-density facilities.

Hyperscale, Colocation, and Edge Use Cases

Hyperscale datacenter operators such as Google, Amazon, and Microsoft are driving utility-grade transformer demand. CloudHQ’s 225 MW Illinois campus required four 100 MVA transformers at a new substation, an example of how tightly these facilities are linked to grid infrastructure. Hyperscalers are early adopters of technology such as digital twins and predictive maintenance tools, using real-time data to simulate loads and prevent failures.

Colocation providers balance growth and reliability through modular expansion. They typically deploy standardized 2.5 MVA dry-type units per hall, adding capacity in phases as customer demand rises. Most top-tier colos maintain 2N redundancy, ensuring that each tenant’s power remains stable even if a transformer or UPS path fails.

At the other end of the spectrum, edge and micro data centers operate at smaller scales but require equal reliability. Prefabricated skids that integrate 300 kVA transformers, switchgear, and UPS in a single container allow rapid deployment close to end-users. Dry-type units eliminate oil-management challenges and reduce site permitting requirements, ideal for compact or remote locations.

Innovation and Future Developments

Transformers are evolving from static equipment to intelligent, connected assets.

Smart Transformers: Equipped with IoT sensors and connectivity, these units transmit load, temperature, and power-quality data for remote diagnostics. Predictive maintenance reduces downtime and operating costs.
Digital Twins: Virtual replicas simulate transformer behavior under different conditions, helping operators anticipate failures and optimize settings.
Modular and Prefabricated Systems: Factory-built skids combine transformers, breakers, and UPS in a plug-and-play format, cutting construction schedules by months.
Advanced Materials: Amorphous-metal cores and high-temperature insulation improve efficiency and load tolerance. Environmentally friendly ester oils replace mineral oils, reducing fire risk and environmental impact.
Integration with Renewables: As data centers pursue sustainability, transformers must handle bidirectional power flow between on-site solar, batteries, and the grid. Early solid-state prototypes point toward future programmable voltage conversion.

These innovations position transformers as intelligent nodes within the digital power ecosystem.

Procurement and Supply-Chain Challenges

Transformer availability has become a bottleneck in global infrastructure. A 30% supply shortfall for power units and a 10% shortfall for distribution units were projected by 2025. According to Northfield’s industry data, the supply shortfall for power transformer units has exceeded those projections. Lead times that once spanned months now stretch up to 4 years for large models. Costs have risen sharply, driven by copper and electrical-steel shortages.

The United States imports about 80% of its transformer MVA capacity, leaving data center projects exposed to geopolitical and logistical risks. The DOE and NIAC have urged creation of a national transformer reserve, but manufacturing capacity expansion will take years. That’s where partners such as Northfield provide the most value by enabling timely supply of power equipment to meet surging demand.

For developers, these realities demand new procurement strategies:

Early ordering to secure production slots.
Standardized specifications that enable bulk purchasing.
Multi-supplier sourcing across regions.
Contingency planning with spare or mobile transformers for emergencies.

How Northfield Bridges the Gap

Northfield Transformers helps clients overcome these bottlenecks through a global production network spanning Europe, Asia, and North America.

Our transformers, ranging from 1 MVA to 400 MVA and up to 500 kV, meet IEEE, ANSI, and EcoDesign Tier 2 standards for efficiency and sustainability.

While many manufacturers quote lead times of 12–45 months, Northfield typically delivers within 4–24 months, leveraging advanced production scheduling and pre-qualified manufacturing partners.

We oversee quality control through frequent factory visits, independent assessments, and FAT inspections. Our logistics capabilities and long-standing relationships ensures on-time delivery with end-to-end visibility and customs management for even the largest units.

Learn More

Transformers form the foundation of data center reliability. As workloads grow and energy systems evolve, intelligent procurement and design decisions today could determine future uptime. At Northfield, every transformer is built for longevity, tested in-house, and configured for smart-grid compatibility, enabling our data center customers to deploy faster, operate safer, and plan confidently.

Want data center transformers and electrical components with the shortest lead times in the industry?

Explore our Data Center Solutions or contact our team to discuss specifications and delivery timelines tailored to your project.

Frequently Asked Questions (FAQs)

What types of transformers are used in data centers?

Data centers use high-voltage, medium-voltage, and low-voltage transformers to step down power safely from the grid to meet the requirements of IT equipment. Large sites often combine oil-filled and dry-type units for efficiency and safety.

Why are dry-type transformers preferred in modern data centers?

Dry-type transformers do not use oil, which removes the risk of leaks and fire hazards. They are easier to maintain and suitable for indoor environments.

How are transformer shortages affecting data center projects?

Lead times have extended up to four years for large units, making transformers a major factor in project scheduling and cost planning.

How does Northfield deliver transformers faster than competitors?

Northfield works with a global network of manufacturers and logistics partners to reduce production bottlenecks and ensure delivery within 4–24 months. Use our lead-time calculator to estimate delivery time based on your needs.

What are Northfield’s capabilities in supporting data center projects?

Northfield supplies high-quality transformers, generators and other electrical power equipment with short lead times, ensuring our data center customers meet project timelines, maintain uptime and exceed their sustainability goals.

How does Northfield ensure short lead times for its products?

Through global partnerships and innovative logistics strategies developed over the last decade, we minimize lead times for components across the power supply chain, allowing data center projects to proceed without delays.

In which regions does Northfield offer its services?

Northfield maintains an active presence on four continents: North America, South America, Europe, and Asia. While we focus on supplying the American market, we provide comprehensive support for data center projects worldwide.