Youngkin touts Henrico firm powering Virginia’s data center boom

As data centers continue to sprawl across Virginia — with hundreds already built and many more planned nationwide — the demand for the equipment powering these massive digital hubs is surging. Gov. Glenn Youngkin on Monday touted a Henrico company that can rapidly deploy hyperscale, AI, and colocation data center components.

Hyper, the Henrico-based manufacturer, cut the ribbon on its new headquarters, where engineers design electrical power distribution and cooling systems that regulate temperature and supply electricity to the racks housing the critical servers. 

The company’s technology uses a smaller, more efficient design than traditional cooling infrastructure and is engineered  to to minimize power loss throughout a data center’s system. It also touts its extensive U.S. manufacturing footprint as a way to ease supply chain challenges.

“(We) build it with the highest efficiencies of steel, copper, aluminum, so that there’s less loss through their distribution system, allowing more of the energy to go to the actual chips that do the work,” said Dennis Strieter, co-founder of Hyper. “Cooling’s the same way. We want to match the cooling with the actual output of the heat of the chip and we want those tied together through sensors so that we’re not over cooling the space and we’re not under cooling the space.”

Hyper’s model is to manufacture parts in 18 states across the country, ensuring components reach data centers quickly as construction booms nationwide. The company currently employs 40 people at its Henrico headquarters.

“We spend a lot of time focusing on on-time delivery, because right now, in the market, that’s what’s holding everybody up — they’re not getting the equipment to open the buildings on the day they promised their customer,” Strieter said. ”We’ve had to rethink the way that we designed products.”.

Data centers consume vast amounts of energy to cool the rows of server racks inside their buildings. While Hyper’s components are smaller and more efficient, it’s up to the data centers themselves to determine how to further reduce energy use as rack technology evolves.  

With Dominion Energy currently awaiting State Corporation Commission approval for a new rate class for data centers, lawmakers are examining how to expand Virginia’s energy capacity to sustain the fast-growing industry.

“We’ve got a lot of work to do on the policy front to make sure that data centers are able to take on their own power generation and are willing and able to take on the added cost of the infrastructure necessary for the big builds,” Youngkin said Monday. “We want more data centers here. It’s a big driver for our economic future and for our national security.”

On the energy side, some officials worry that not all proposed data centers will ultimately be built, potentially leaving the state with excess energy projects already in the pipeline. 

When asked whether there’s a possibility of an “AI bubble,” the governor said he remains encouraged by the strong demand for new data centers amid the rapid expansion of artificial intelligence across industries. He added that companies like Hyper will continue to play a vital role for decades to come.

“Huge supply with no demand, that’s what causes a crash,” Youngkin said “And in this case, there is giant demand, giant growth, and it’s being met with, of course, investment.” 

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