For data center developers, securing capital and land is no longer the chief bottleneck to getting projects built.

Now, the “real bottleneck” is power, and that’s creating reverberations up and down the supply chain for the critical infrastructure needed to get that power delivered from where it is generated to where it is needed, said Jordan Castaneda, data center sales manager at Maddox Industrial Transformer.

One element of that critical infrastructure? The transformer. Transformers step up or down voltage to usable levels for data centers or other end uses.

“The Department of Energy expects 12% of total U.S. electricity consumption to come from data centers by 2028,” Castaneda said. “Everybody is in a rush to build, demand for electrical infrastructure is growing at exponential rates, and that has made transformer procurement a critical speed-to-market issue.”

Historically, buyers only had two choices. They could work with big manufacturers with slower lead times or turn to cheaper imported equipment that was more readily available.

“Traditional OEMs, who have been around for years, work directly with utilities, which drives a lot of their demand and results in their lead times being very long,” Castaneda said. “With overseas partners, you’re rolling the dice. You can get transformer delivery fast, but often with the trade-off sacrificing quality and after-sales support.”

Washington state-based Maddox, which specializes in supplying, renting, repairing and buying padmount, substation, dry-type and polemount transformers, has positioned itself as a third option, Castaneda said. 

“Our customers get the quality and support that you would get with a big OEM, but because of our large transformer inventory, we’re able to significantly shorten lead times,” he said. “Plus, we are here in the U.S. with locations and yards across the country.”

Easy To Replicate

The company’s differentiated approach includes a standardized design process and spare-equipment strategy that aligns with the modular design becoming increasingly popular across data center construction.

While customers have some dynamic variability with regard to line voltage, by crafting standardized transformer design and specifications around building configurations, they can reduce the engineering time and cut downstream delays, Castaneda said. 

“Our approach helps developers build things that are going to be easy to replicate,” he said. 

Holding Stock

While the acute supply chain issues seen during the pandemic taught developers lessons that have served them well during the shortages of the data center boom, the slack capacity strategy is one Maddox has always leveraged, with positive results for the company’s customers. 

“We hold stock of thousands of transformers and coordinate storage with our customers and maintain contingency plans for the critical units so we can have them available immediately when they’re needed,” Castaneda said.

Keeping spare transformers in stock can be expensive. But having a megawatt data center campus sitting idle and offline because of a transformer delay or a shortage of one transformer replacement part can result in millions of dollars in lost revenue, he said.

Proactive spare inventory management helps Maddox support its customers in getting new data centers online quickly and in maintaining them throughout their life cycle to protect uptime.

“If a customer places an order with us, we hold spare units in our inventory,” Castaneda said. “We have those units ready to be deployed that same day, if needed. That way, the customer avoids delays of weeks or months.”

The company has multiple shops and yards across the U.S. and back-end support programs tailored specifically to data center operators, he added.

With data center campuses growing larger and more complex, a partnership, rather than transactional approach, has become more important for developers, their vendors and the sector’s other key players.

“It takes a village,” Castaneda said. “The utilities, the end customer, the electrical engineers, the electrical contractors, everyone has to come together to help identify what’s going to be the right solution for what is getting built.”

Maddox’s customers appreciate that the company’s experts understand their road maps and tend to involve them early in the preplanning process.

“We help by reserving anticipated transformer capacity,” Castaneda said. “It helps leave room for future growth. When it comes to preplanning and working together, the earlier the better.”

To be sure, price is important, but it is no longer the most important consideration.

“When making transformer procurement decisions, data center developers should prioritize reliability, scalability and availability to get their projects powered as fast as possible and keep them powered,” Castaneda said. “We have the technical expertise, customer service platform and boots-on-ground local presence to deliver.”

This article was produced in collaboration between Maddox Industrial Transformer and Studio B. Bisnow news staff was not involved in the production of this content.

Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to studio@bisnow.com.