Cleveland-Cliffs is expanding grain-oriented electrical steel production at its Butler Works facility in Pennsylvania as the U.S. power sector prepares for higher demand for transformers and other grid equipment.
The company is investing $200 million in the project, backed by a $75 million award from the U.S. Department of Energy. Cleveland-Cliffs expects the expansion to increase Butler Works’ GOES production volume by up to 25%.
Federal officials are scheduled to visit the facility on October 6 to review the project, including U.S. Energy Secretary Chris Wright, Assistant Secretary of Energy Audrey Robertson and Under Secretary of Commerce William Kimmitt.
The investment matters beyond the steel plant. GOES is a specialized electrical steel used to manufacture transformer cores, putting Butler Works upstream of equipment needed to move electricity across the grid.
That supply chain is facing pressure as utilities add generation and upgrade transmission and distribution systems. The rapid construction of data centers is adding another source of electricity demand, increasing the need for new power infrastructure.
$200M Butler Works Upgrade
Cleveland-Cliffs is upgrading the Butler Works production process rather than building a new greenfield steel facility.
The project includes four new induction reheat furnaces that will replace two existing natural-gas-fired slab reheat furnaces. The furnaces will electrify part of the steelmaking process while improving the heating of slabs before hot rolling.
The company also plans additional infrastructure improvements throughout the facility. Cleveland-Cliffs expects the changes to improve steel quality, reduce production losses and increase operating efficiency.
The project is expected to reach completion in early 2028, according to the company’s latest announcement. The Department of Energy’s project page, however, currently lists an expected completion date of 2029, reflecting a longer federal project schedule.
At peak construction, the project is expected to support about 220 construction jobs.
Butler Works Has a Critical Position in Transformer Supply
The project targets a material that sits near the beginning of the transformer manufacturing chain.
GOES has magnetic properties that make it suitable for transformer cores, where it helps transfer electrical energy efficiently between voltage levels. That makes domestic production important as the country adds substations, transmission capacity and new generation.
Cleveland-Cliffs identifies Butler Works as the only U.S. producer of grain-oriented electrical steel. The facility therefore has a direct role in supplying domestic transformer manufacturers.
The DOE is supporting the project through its Industrial Demonstrations Program. Federal project information describes the Butler Works investment as an effort to electrify part of the production process while maintaining domestic production of a material important to the electricity sector.
That distinction is important as the U.S. electricity system expands. New power plants alone cannot deliver additional electricity to customers. The country also needs transformers, substations, transmission lines, distribution equipment and conductors to connect that generation to load.
Data Centers Add Another Layer of Electricity Demand
Data center construction is becoming an increasingly important source of new electricity demand in the United States.
Large computing campuses can require hundreds of megawatts of power, creating additional requirements for generation and the electrical infrastructure connecting those facilities to the grid.
The resulting construction cycle extends into manufacturing.
Transformer producers need electrical steel. Utilities need transformers and substation equipment. Contractors need wire and cable to build the electrical systems that connect new loads and generation.
That broader supply chain is already producing new manufacturing investment elsewhere in the country.
In Mississippi, Southwire has broken ground on a more than $256 million expansion of its Starkville manufacturing campus. The project will add approximately 380,000 square feet of manufacturing space as the company increases capacity to serve demand associated with electrification and the rapid expansion of data centers. The Starkville project shows how the same electricity-demand trend driving investment in transformer materials is also reaching wire and cable manufacturing.
Construction Outlook
The Butler Works expansion will remain an active construction project through the remainder of the decade, with Cleveland-Cliffs targeting completion in early 2028.
The work will take place within an operating steel facility, requiring upgrades to production infrastructure while Butler Works continues manufacturing.
The facility employs approximately 1,200 workers represented by United Auto Workers Local 3303, according to Cleveland-Cliffs. The company also says Butler Works generates about $187 million in annual wages and purchases more than $200 million in local supplies and services.
For the broader U.S. construction market, the project illustrates a less visible part of the data-center-driven power buildout: investment is reaching the factories that manufacture the materials needed to expand the grid.
Butler Works GOES Expansion: Project Factsheet
- Location: Lyndora, Pennsylvania
- Owner: Cleveland-Cliffs Inc.
- Investment: $200 million
- Federal support: Up to $75 million from the U.S. Department of Energy
- Project scope: Expansion and modernization of GOES production
- Production increase: Up to 25%
- Major equipment: Four new induction reheat furnaces
- Existing equipment: Two natural-gas-fired slab reheat furnaces to be replaced
- Construction jobs: Approximately 220 at peak
- Current facility employment: Approximately 1,200
- Latest milestone: Federal officials scheduled to visit Butler Works on October 6, 2026
- Expected completion: Early 2028 according to Cleveland-Cliffs; DOE currently lists 2029
- Primary material: Grain-oriented electrical steel used in transformer cores
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