LS Electric has secured a US$46 million contract to supply power distribution equipment for a hyperscale AI data center in the US.

The South Korea-based electric equipment manufacturer will provide products for gas-powered generation facilities within a microgrid, with phased deliveries set to begin in February 2026, over a six-month period.

The project was commissioned by an unnamed global technology firm.

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🔗 Source: The Korea Times

🧠 Food for thought

1️⃣ Korean suppliers challenge Western dominance through speed advantages

LS Electric’s $46 million deal demonstrates how Korean companies are competing directly with established Western players like Schneider Electric and ABB in the lucrative US data center market.

The company’s chairman claims they can deliver solutions more than twice as fast and at competitive prices compared to these major US suppliers2. This speed advantage becomes critical as AI data centers require rapid deployment to meet surging demand.

LS Electric already generated approximately 1.3 trillion won in North American sales last year, with over 70 percent coming from power distribution systems like switchgears1. The company has also achieved UL certification for its power distribution panels, meeting the critical regulatory requirement for US market entry2.

This competitive positioning reflects a broader trend where Korean manufacturers leverage manufacturing efficiency and competitive pricing to challenge incumbent Western suppliers in high-growth technology infrastructure sectors.

2️⃣ Data centers increasingly turn to microgrids as grid constraints intensify

The microgrid component of LS Electric’s deal reflects a fundamental shift in how data centers approach power supply as traditional grid infrastructure struggles to keep pace with demand.

Data center power demand is projected to reach 200GW by 2030, while over 3000GW of renewable generation projects currently face grid connection delays3. This mismatch is forcing operators to seek independent power solutions.

Countries like Ireland and the Netherlands have already banned new data centers that require grid power, pushing the industry toward self-sufficient solutions3. Microgrids allow data centers to integrate various power sources including gas generation, renewables, and battery storage within a single system.

The shift toward microgrids addresses both capacity constraints and reliability concerns, as AI-focused data centers now demand 50-100+ MW of power while requiring uptime levels of 99.982% to 99.995%4.

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