Rolls-Royce said it will more than double its production of diesel-powered backup power generation systems for data centers, and build a new facility in Minnesota, as part of a $24-million investment in U.S. manufacturing.
The company on June 3 said its investment includes a new 250,000-square-foot Logistics Operations Center (LOC) located adjacent to the company’s existing manufacturing facility in Mankato. It will enable Rolls-Royce to increase production capacity for its mtu Series 4000 generator sets, which the company said are in high demand from the rapidly growing data center industry.
Rolls-Royce on Tuesday said it is investing significantly in its U.S. operations, and the expansion at the Mankato site builds on the more than $1 billion Rolls-Royce has invested in the U.S. over the past decade.
“The U.S. market is very important to Rolls-Royce. We have a proud history in America and we are committed to strengthening our presence to support further growth, bringing economic benefits and job opportunities,” said Tufan Erginbilgic, CEO of Rolls-Royce. “Today’s announcement is proof of the transformation of Rolls-Royce in action, enabling us to invest in areas of strategic focus, such as power generation.”
Continued Manufacturing Growth
Rolls-Royce anticipates production at the Minnesota facility will increase by more than 120% by 2026 as compared to last year, with further growth expected in the future. The generator sets use mtu Series 4000 engines that are currently built at the Rolls-Royce facility in Aiken, South Carolina. The Aiken facility is also expected to see an increase in engine production.
The company on Tuesday said the investment supports the strategic ambitions of Rolls-Royce to grow the power generation operations of its Power Systems division, and said sales of power generation products for the data center segment grew almost 50% last year. The U.S. leads the data center market and is home to more than half of the world’s hyperscale data centers.
Joerg Stratmann, CEO of Power Systems, Rolls-Royce, said, “Our hyperscale data center customers have relied on our solutions and partnership for mission critical power for over 15 years—a result of our strategic focus and continuous investment in this sector. This deliberate market positioning has enabled us to effectively address the exponential rise in demand from the data center industry, particularly in the U.S. where this critical new infrastructure will be built.”
The LOC will provide additional capacity for both logistics and assembly operations for the Mankato plant, which exclusively manufactures power generation systems. The facility also will support the company’s commitment to safety by allowing all logistics and assembly activities to be conducted in climate-controlled environments, even with the significant increase in throughput. The LOC offers the development of future capacity and capabilities as the energy landscape continues to evolve.
Since acquiring the business in 2007, Rolls-Royce has continued to invest in manufacturing operations at the Mankato site, most recently completing a $13.9-million expansion of the main manufacturing site and the addition of a research and development center in 2021.
—Darrell Proctor is a senior editor for POWER.
