Datagrid secures Transpower gear for Southland AI site

Datagrid New Zealand has signed a pre-purchase agreement with Transpower New Zealand for equipment for a grid-connected substation at its Southland site. The agreement covers long-lead items for a substation intended to supply a future AI data centre.

The deal includes four high-voltage power transformers, associated bushings, and other long-lead equipment. ELSEWEDY ELECTRIC will supply the transformers.

The substation is planned to connect to the existing 220kV transmission lines linking Manapōuri Power Station to Tiwai Point. It is designed to deliver up to 360MVA of renewable electricity to Datagrid's planned Southland data centre.

The substation will use an N-1 configuration, with one of the four transformers acting as backup so full capacity can continue if one unit is taken offline.

Procuring long-lead equipment is an early step in projects of this kind because transformers and related components can take a long time to manufacture and deliver. For Datagrid, the agreement moves the grid-connection process forward while detailed substation design continues.

Rémi Galasso, Founder and Chief Executive Officer of Datagrid New Zealand, said: "Securing the grid connection equipment for our new GXP is a major milestone for Datagrid. We appreciate the professionalism of the Transpower team in working through the connection process with us. It is great to work together as TeamNewZealand, willing to position New Zealand as an international digital player in this highly competitive AI infrastructure game."

Transpower presented the project as part of its broader task of managing large new electricity connections to the national grid. The state-owned grid operator is balancing demand from high-energy projects against available transmission capacity and generation supply.

James Kilty, Chief Executive Officer of Transpower New Zealand, said: "Transpower is carefully managing projects that require significant electricity such as Datagrid's to ensure that as they connect there is sufficient capacity on the grid to deliver the electricity and sufficient generation available to supply it. While detailed design for the substation is ongoing, procuring these transformers, which are long-lead items, helps Datagrid meet its planned timeline, which is targeting substation commissioning in late 2027."

Project scale

The Southland project points to growing interest in locating data infrastructure close to large renewable power sources. The transmission route from Manapōuri to Tiwai Point has long been associated with major industrial electricity demand in the region, and Datagrid's planned connection would place a large computing facility within that landscape.

The use of 220kV transmission infrastructure and a 360MVA supply target indicates a substantial power requirement for the site. While Datagrid has not provided further construction details here, the scale of the substation suggests it is planning a large installation rather than a small regional facility.

For Transpower, the agreement also highlights the pressure data centres and AI-related projects can place on grid planning. Large users require not only a physical connection but also confidence that the network can carry the load and that generators can meet demand without undermining reliability elsewhere on the system.

Supplier role

ELSEWEDY ELECTRIC is supplying the transformers, placing the manufacturer at the centre of one of the most time-sensitive parts of the substation build. Power transformers are among the most specialised and supply-constrained components in transmission projects, which is why developers often try to secure them early.

Abdelrahman ElSewedy, Group Chief Operations and Strategy Officer of ELSEWEDY ELECTRIC, said: "DataCentres are becoming the backbone of the digital economy, and meeting their growing energy needs will require trusted partners with both global scale and local commitment. We are proud to support Datagrid New Zealand in a project that showcases New Zealand's potential to become a world leader in sustainable data computing. Through our global manufacturing network, we have the capability to meet rising demand across international markets while delivering with speed, reliability, and confidence. Together, we are not only building infrastructure for today, but creating the foundation for a more connected and sustainable future."