Heron Power Selects Morgan Hill, California for First U.S. Factory to Produce Next-Generation Grid Electronics

Heron Power, an American advanced power electronics manufacturer, announced today that it has chosen Morgan Hill, California as the site of its first large-scale manufacturing facility. The company will convert a former 286,000-square-foot distribution warehouse, located roughly 30 minutes south of San Jose, into an advanced production plant for the Heron Link — a 5-megawatt medium-voltage power conversion system designed for large-scale energy and data center projects.

The decision marks a significant step in addressing a critical vulnerability in the U.S. energy supply chain. Over 80% of essential grid components such as transformers and inverters are currently imported, while much of the domestic grid infrastructure relies on decades-old, largely mechanical technology that is increasingly expensive and difficult to source. As demand for electrification, new manufacturing, and AI data centers accelerates, the gap between modern energy needs and legacy grid hardware has become a pressing national concern.

Heron's first factory is designed to manufacture up to 10,000 Heron Links per year, representing over 40 gigawatts of capacity annually — roughly three-quarters of the total new generating capacity the entire U.S. grid added in 2025, the largest single-year buildout in more than two decades. The company expects to invest over $100 million in the facility and create more than 600 jobs in advanced manufacturing, engineering, and operations roles in California. Site preparation begins immediately, with mass production slated to start in late 2027.

The Heron Link consolidates multiple pieces of grid equipment into a single compact, modular unit powered by intelligent, software-controlled semiconductors. According to the company, this approach delivers higher efficiency, increased system uptime, faster deployment, and a smaller physical footprint — while enabling large AI data centers to support rather than destabilize the grid.

"America's grid has to grow faster than it has in decades. We're seeing new demand from AI and EVs, and at the same time new supply from solar and storage," said Drew Baglino, CEO and Founder of Heron Power. "The equipment running the grid hasn't changed in fifty years. Heron Factory One in Morgan Hill is how we fix that. We're manufacturing the leapfrog technology our grid needs, at scale, in America first."

Heron Power evaluated manufacturing locations across multiple states before settling on Morgan Hill. The site's proximity to the company's engineering headquarters and the broader Bay Area's deep talent pool in engineering and manufacturing is expected to accelerate the factory's ramp to full output, quality, and cost targets. The City of Morgan Hill, PG&E, and state partners worked alongside Heron Power and its real estate advisor JLL over ten months to finalize the facility, which is supported in part by a $26.4 million California Competes (CalCOMPETES) award — a competitive, merit-based tax credit administered by CA GO-Biz.

"Heron Power is building the technology that will make America's grid faster, more efficient and more reliable, and we're proud to support their expansion in California through CalCompetes," said Dee Dee Myers, Senior Advisor to Governor Newsom and Director of GO-Biz. "Heron Power is the latest company betting on California workers — and we're betting on them right back. Their new facility adds more than 600 good-paying jobs and represents a direct investment in the energy infrastructure of the future, built right here in the Golden State."

The opening of Heron Factory One signals a broader shift in the energy sector toward domestic manufacturing of advanced grid hardware. By scaling production of transformer-less, software-controlled power electronics, the company aims to reduce reliance on imported components and modernize a grid that has struggled to keep pace with the rapid growth of renewable energy, battery storage, and high-density computing loads. Industry observers will be watching whether this model can be replicated across other critical infrastructure categories as the U.S. pushes to accelerate its energy transition.