In addition to conventional drilling and demolition techniques, drilling with pulsed electric power has been investigated intensively, and commercial applications have begun to emerge. The most efficient method, often called plasma channel drilling (PCD), uses electrical pulses to generate a plasma channel in the rock. The expansion of this channel within the rock performs the demolition. The technique relies on that fact that for fast pulse rise-times (50 ns -500 ns) the breakdown field-strength of water is higher than that of rock, so that the discharge takes place in the rock. To date, in publications dealing with this topic, plasma dynamics, crack formation, and setup of the electrodes are the primary areas of investigation. In these investigations, the high voltage pulses have been generated using modulators based on spark gaps: either as single-switch or in a Marx-generator setup. These modulators are able to generate high voltages and high currents simultaneously, but the PCD method does not require high currents for igniting the discharge. Meanwhile, after ignition the voltage across the arc is relatively small. Thus these modulators are oversized. In this paper, a new concept, consisting of a solid state modulator which generates a high-voltage pulse for ignition, and a high output-current to expand the plasma, is presented. The solid state modulator consists of a single semiconductor switch, saturable inductors and a pulse transformer. In addition to being more compact, the solid state approach has improved lifetime and reliability compared to approaches using spark gap switches.