Transformers for Data Centers Industry Analysis: the market is projected to grow to US$2.996 billion by 2031

According to the recent report from QYResearch, global demand for Transformers for Data Centers is entering an unprecedented growth phase as AI training clusters, denser server racks, and hyperscale expansions transform the power backbone of digital infrastructure. The new research report Transformers for Data Centers - Global Market Share and Ranking, Overall Sales and Demand Forecast 2025-2031 reveals that the market reached US$1.15 billion in 2024 and is projected to grow to US$2.996 billion by 2031, registering a robust 13.4% CAGR between 2025 and 2031.

In 2024, total global production capacity for data-center transformers stood at 69,345 MW, with an average selling price of US$17 per kW. These units-whether dry-type or oil-immersed-are not merely distribution assets; they are essential safeguards of uptime, power quality, and efficiency. The race to support AI-driven facilities has pushed the industry toward new designs: amorphous alloy cores, liquid cooling, and digital monitoring systems are advancing rapidly, while compliance with tightening global energy-efficiency standards continues to accelerate adoption.

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Latest Data

· Market size 2024: US$1,150 million

· Forecast 2031: US$2,996 million

· CAGR (2025-2031): 13.4%

· Output 2024: 69,345 MW

· Average selling price: US$17 per kW

· Key role: Voltage conversion, isolation, and secure power supply for IT loads

· Technology shifts: Amorphous metal transformers cut no-load losses by 60-70%; liquid cooling and smart monitoring rising

· Policy pressure: EU's ecodesign and China's GB 20052-2020 efficiency rules drive elimination of inefficient capacity

Classification

· Dry-type Transformers

· Oil-immersed Transformers

Applications

· Non-AI Data Centers

· AI Data Centers

Leading Companies

Hitachi Energy
Siemens Energy
Eaton
TMC Transformers
Hyosung Heavy Industries
Schneider Electric
GE
Virginia Transformer
Eaglerise Electric and Electronic
Guangdong Mingyang Electric
Hainan Jinpan Smart Technology Co., Ltd.
TBEA Co., Ltd.
Guangdong Shunna Electric Co.,Ltd.
Jiangsu Yangdian Science and Technology

Recent Developments

Hitachi Energy expanded transformer production in the United States in 2025, building on earlier multi-hundred-million-dollar investments. The company is targeting dry-type and high-efficiency designs to support AI-ready facilities.

Siemens Energy invested heavily in its Charlotte, North Carolina operations in 2024, adding US$150 million in capacity. In 2025, it partnered with Compass Datacenters and Eaton to deploy standardized modular power blocks, cutting deployment schedules significantly.

Schneider Electric launched new high-density distribution and thermal management solutions in 2025, designed for AI clusters that exceed one megawatt per pod.

Virginia Transformer delivered high-MVA custom units for U.S. data-center expansions in 2024-2025, cementing its role as a specialized engineering partner for hyperscale customers.

TMC Transformers continued to roll out cast-resin dry-type designs certified for the most stringent fire safety and environmental classes, appealing strongly to operators prioritizing indoor safety and low maintenance.

Product Snapshots

Hitachi Energy - RESIBLOC® Dry-Type Transformer

· Voltage classes up to 36 kV HV, LV up to 24 kV

· Partial discharge levels below 10 pC

· Cooling modes AN, ANAF, AFWF; enclosures up to IP54

· Fire safety class F1 and robust overload capacity, tailored for indoor distribution in large data centers

Siemens Energy - Fluid-Immersed Transformer with Sensformer®

· Ratings up to 2,500 kVA and 36 kV

· Digital sensors measure oil level, temperature, and currents

· Cloud-enabled condition monitoring for predictive maintenance

· Designed to enhance uptime and optimize loading in AI workloads

Schneider Electric - Trihal Cast-Resin Transformer

· Capacity up to 3,150 kVA at voltages of 11-20 kV

· Fire-safe dry-type design with low maintenance requirements

· Suitable for indoor or outdoor use with appropriate enclosure protection

· Widely deployed in hospitals, airports, and now hyperscale data centers

Virginia Transformer - Data Center Power Transformer Portfolio

· Dry-type range 300 kVA-20 MVA, oil-filled range up to 1,400 MVA and 500 kV

· Cooling mediums include mineral oil, Envirotemp (FR3), and silicone fluids

· Custom-engineered designs recently delivered for hyperscale expansions in the U.S.

TMC Transformers - Cast-Resin Transformer for Data Centers

· Insulation classes F and H, with operation up to 180 °C

· Fire, environmental, and climate ratings E4, C3, F1

· Enclosure ratings from IP21 to IP67

· Strong resistance to overload and short-circuit stresses

Downstream Customers

Amazon Web Services
Microsoft
Google
Meta
Oracle
IBM
Alibaba Cloud
Tencent Cloud
Baidu
ByteDance
Equinix
Digital Realty
NTT Global Data Centers
CyrusOne
OVHcloud

Market Trend

AI Rack Densities

The rise of AI training clusters is reshaping electrical distribution. While average rack densities remain around 10-15 kW, new AI pods are exceeding 100 kW per rack, and some hyperscale deployments now push beyond one megawatt per pod. This has driven demand for liquid-cooled transformers and shorter low-voltage distribution paths, ensuring both efficiency and reliability under extreme loads.

Doubling Power Consumption by 2030

The global energy footprint of data centers is forecast to more than double to nearly 945 terawatt-hours by 2030, from roughly 415 TWh in 2024. Transformers are at the core of this growth, enabling stable power delivery at both the campus interconnect and rack distribution levels.

Supply-Demand Imbalance

Despite major capital investment by leading manufacturers, transformer supply remains tight. Shortages of skilled labor and electrical steel have stretched lead times, while demand from utilities and data centers has risen simultaneously. This imbalance is expected to persist into 2026-2027.

Dry-Type and Ester Oils

Dry-type cast-resin transformers are gaining share inside white space due to safety, low maintenance, and quiet operation. For outdoor applications, natural ester oil-filled transformers are increasingly preferred because they are biodegradable, offer high fire points, and align with green data center objectives.

Digitized Transformers

The integration of sensors, IoT gateways, and cloud analytics is becoming standard. Siemens Energy's Sensformer and similar technologies allow real-time monitoring of temperature, currents, and oil conditions, reducing unexpected downtime and enabling predictive maintenance strategies.

Modular Power Systems

Prefabricated modular blocks containing switchgear, UPS, and transformers are being deployed by colocation providers and hyperscalers. These modules reduce installation time by months and ensure factory-tested reliability, giving operators faster time-to-market for AI-driven capacity.

Rising Efficiency Standards

The EU has tightened transformer loss limits under ecodesign regulations, while China's GB standards continue to raise efficiency thresholds. These measures are forcing operators and suppliers to adopt higher-efficiency designs, eliminating outdated units from the market.

Amorphous Metal Cores

Amorphous metal core transformers reduce no-load losses by up to 70% compared with traditional silicon steel, offering significant lifecycle energy savings. Their adoption is expanding in hyperscale and edge data centers despite higher material costs, supported by regulatory and environmental incentives.

Tariffs and Trade Risk

In 2025, changes in U.S. tariff policies on steel, aluminum, and selected electrical products added cost pressures and procurement risk. This has encouraged operators to consider multi-sourcing strategies and spurred manufacturers to localize production capacity closer to demand hubs.

Conclusion

Transformers for Data Centers are no longer commoditized electrical components; they are strategic assets at the heart of the AI revolution. The combination of surging demand, rising technical standards, and supply bottlenecks is reshaping both competition and innovation.

Looking forward, dry-type designs, digital monitoring, amorphous cores, and modular prefabrication will dominate near-term adoption. In the longer term, breakthroughs in wide-bandgap semiconductors and integrated DC architectures may further transform the landscape.

For buyers and operators, the challenge is twofold: securing long-term supply in a tight market, and ensuring that new assets meet the dual imperatives of efficiency and resilience. With hyperscale players and global manufacturers now aligned on green, digital, and modular power infrastructure, the next decade will define the winners of the data-center transformer market.

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