Jakarta, INTI - Heron Power, established by former Tesla executive Drew Baglino, revealed on Wednesday that it has secured $140 million to manufacture gigawatts-scale solid-state transformers for data centers and power grids.
The fundraising marks a rapid progression for the startup, which had previously closed a $38 million Series A round in May. Although Baglino noted that the company was not in urgent need of capital, overwhelming customer interest, exceeding 40 gigawatts in potential orders, prompted Heron Power to raise additional funds.
“If our customers are leaning in, we need to lean in as well,” Baglino, who is CEO of Heron Power, told TechCrunch. “We gotta go faster.”
The pace of fundraising highlights how expanding data centers are fueling demand for technologies capable of delivering electricity more efficiently to high-performance servers. Baligno, who spent nearly 20years at Tesla leading powertrain and energy divisions, brings extensive experience in scaling advanced energy systems.
The Series B round was led by Andreessen Horowitz’s American Dynamism Fund and Breakthrough Energy Ventures, with participation from Capricorn Investment Group, Energy Impact Partners, Gigascale Capital, and Valor Atreides AI Fund.
A New Generation of Grid Technology
Solid-state transformers have been in development for more than a decade, but only recently have they advanced enough for deployment in data centers and other energy-intensive environments.
This technology is designed to replace conventional iron-core transformers, which have remained largely unchanged for over a century. While traditional transformers are cost-effective and efficient, they are bulky and generate substantial heat. Solid-state alternatives are more compact and can enhance efficiency by consolidating multiple pieces of equipment, addressing two major challenges faced by data center operators.
In addition, solid-state transformers can intelligently manage electricity from diverse sources, including wind, solar, and battery storage, because they rely on semiconductors rather than passive metal components.
Heron Power’s product, branded as Heron Link, converts medium-voltage electricity into the 800-volt power required by Nvidia’s reference rack systems. Each unit can handle up to 5 megawatts and contains dozens of modular converters. If a module fails, it can be replaced within approximately 10 minutes, significantly faster than swapping out a traditional transformer.
Every Heron Link unit also integrates specialized lithium-ion batteries capable of delivering rapid discharge for up to 30 seconds, smoothing transitions to backup systems such as grid-scale batteries and enabling data centers to eliminate conventional uninterruptible power supplies.
By consolidating equipment, solid-state transformers reduce potential failure points and lower overall costs. “We can remove 70% of the gear involved,” Baglino said. “For some data center applications, it might be savings of an order of magnitude.”
Data Centers Driving Demand
Currently, data centers account for roughly one-third of Heron Power’s business, with the remainder divided between solar energy and grid-scale battery applications, both of which benefit from the flexibility and responsiveness of solid-state technology.
The company plans to allocate the new capital toward building a manufacturing facility capable of producing 40 gigawatts of Heron Link transformers annually. This output would represent approximately 10% to 15% of annual production outside China, or around 5% to 10% of total global demand, comparable to half of Texas’s peak electricity consumption.
Baglino stated that pilot production is expected to begin in early 2027, followed by a production ramp-up over the subsequent two years.
Although Heron Power faces competition in the solid-state transformer space, especially as aging grid infrastructure requires replacement, its strong funding position and Baglino’s large-scale production experience may provide a competitive edge. “We will push as hard as we can,” he said.
Conclusion
As data centers expand to support AI-driven growth, the demand for smarter and more efficient grid infrastructure is intensifying. Heron Power’s latest funding round positions the company to accelerate production of solid-state transformers, potentially reshaping how electricity is delivered to large-scale digital and energy systems. With strong investor backing and experienced leadership, the startup aims to capitalize on a pivotal shift in power infrastructure modernization.
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