The invention comprises an electrical apparatus and method of manufacture. The apparatus includes a substantially annular inductor comprising an inductor core composed of at least a distributed gap material. The distributed gap material includes particles of alternating layers of magnetic and non-magnetic materials separated by a gap material. The particles comprise an average layer thickness of less than about one hundred micrometers, where a majority of said layered particles comprise an average cross sectional size of less than about one millimeter. The inductor is cooled using at least one of: a thermally conductive potting material, a liquid coolant in direct contact with the inductor, a cooling line through the potting material or liquid coolant, and a chill coil in a container about the potting material and/or the liquid coolant.