Microsoft-backed startup VEIR is bringing superconducting cables to data centers as AI workloads push power demands from 200 kilowatts to multi-megawatt racks. The Massachusetts company's 3-megawatt cable system could solve space and heat problems plaguing next-generation facilities, with pilots starting next year before a 2027 commercial launch.
VEIR just made a strategic pivot that could reshape how data centers handle the AI power crunch. The Microsoft-backed startup is adapting its superconducting cable technology from transmission lines to solve an emerging crisis inside data centers themselves.
"In the next couple of years, it's going to be 600 kilowatts, and then we're going to a megawatt," VEIR CEO Tim Heidel told TechCrunch. "We're speaking to folks that are now trying to wrap their heads around the architecture for how you design data centers that have multi-megawatt racks."
The numbers tell the story of an industry hitting physical limits. Data center power demands have exploded from tens of kilowatts to 200 kilowatts in just a few years, driven largely by AI workloads that require massive computational power. At these scales, even the low-voltage cables bringing power to server racks become problematic, taking up too much space and generating excessive heat.
VEIR's solution involves the same superconducting materials it developed for long-distance power transmission, but reengineered for data center needs. The company's first product will be a cable system capable of carrying 3 megawatts of low-voltage electricity while requiring 20 times less space than traditional copper cables and carrying power five times farther.
The technology relies on superconductors - materials that can conduct electricity with zero energy loss when cooled to extremely low temperatures. VEIR wraps these materials in jackets containing liquid nitrogen coolant that maintains temperatures at -196°C (-321°F). Termination boxes at cable ends handle the transition from superconductors back to conventional copper connections.
"We're really a systems integrator that builds the cooling systems, manufacturers the cables, puts the whole system together in order to deliver an enormous amount of power in a small space," Heidel explained to TechCrunch.
The pivot from utilities to data centers reflects a shift in market urgency. While electric utilities remain cautious about adopting new technologies, data center operators are scrambling for solutions as AI demands outpace infrastructure capabilities. "The pace at which the data center community is moving, evolving, growing, scaling, and tackling challenges is far higher than the transmission community," Heidel noted.
VEIR has been in conversations with data center operators for years, but recently noticed a change in tone. "We were seeing a lot of folks saying, 'Oh this grid interconnection problem is a real thing, and we got to figure out how to solve that.' But then a handful of potential customers started turning around and saying, we actually have really hard problems to solve on our campuses and inside of our buildings," he told TechCrunch.
To validate the technology, VEIR built a simulated data center near its Massachusetts headquarters. The company plans to pilot the cable systems in actual data centers next year, with commercial availability targeted for 2027. The timeline reflects the urgent need for solutions as operators grapple with designing facilities that can handle multi-megawatt server racks.
"The AI and data center community is desperate to find solutions today and is desperate to stay ahead. There's a tremendous amount of competitive pressure to stay at the forefront," Heidel observed. This desperation is creating opportunities for technologies that might have taken years to gain traction in more conservative industries.
The backing from Microsoft adds significant credibility to VEIR's data center push. As one of the largest cloud providers globally, Microsoft has firsthand experience with the infrastructure challenges that AI workloads create. The company's investment suggests confidence that superconducting cables could become essential infrastructure for next-generation data centers.
VEIR's pivot from transmission lines to data centers represents a broader shift as AI infrastructure demands push traditional technologies to their limits. With Microsoft's backing and pilot deployments starting next year, superconducting cables could become the new standard for handling multi-megawatt workloads. The 2027 commercial timeline aligns with when industry experts expect data center power requirements to reach truly unprecedented scales, making VEIR's space-saving, heat-reducing technology potentially critical infrastructure.
