Electrical equipment manufacturer ON.energy has signed a 5GW transformer supply agreement for data center and renewable infrastructure applications in the US.

The agreement will initially support the deployment of its medium-voltage AI UPS (Uninterruptible Power Supply) technology at data center campuses starting next year.

“AI data centers are becoming the largest and most dynamic electrical loads in the world. To deploy them responsibly at scale, we need partners who can deliver not only at volume but at the highest standard of quality,” said Dax Kepshire, president of ON.energy’s Data Center division.

“This agreement ensures we have the infrastructure needed to continue deploying grid-safe data centers at the pace the market requires.”

Under the terms of the deal, ON.energy selected transformer manufacturer Prolec GE to manufacture and deliver three-phase pad-mount transformers purpose-built for ON.energy’s medium-voltage architecture. According to the company, the units will be deployed across both the grid-connected and behind-the-meter AI data centers. The company claims that the technology can be used to stabilize AI workloads, enforce controlled ramp rates, and protect both the data center and the grid during voltage disturbances.

ON.energy launched its AI UPS in October, with claims that it is the first UPS to be purpose-built to handle the unique power demands of large-scale AI compute facilities.

Unlike many conventional UPS units, ON.energy’s AI UPS is grid-interactive, enabling data center operators to participate in energy markets and earn additional revenue from their infrastructure. According to ON.energy, operators could generate “millions of dollars annually per 100MW of IT load” by leveraging the system in grid services or energy savings programs.

Founded in 2016, ON.energy is based in Miami, Florida. In addition to the development of UPS systems, the company also develops utility-scale energy storage systems, with more than 400MWh currently under construction.

ON.energy is not the only company to launch a UPS focused on the AI data center market. In October, Solidion Technology announced its Peak Series UPS, which the company said it expressly aimed at AI data center developers.