Can UK Cope with AI-Driven 20% Rise in Data Centres by 2030?

The number of data centres in the UK is projected to grow by almost a fifth, with nearly 100 new sites planned, according to analysis shared with BBC News by construction researchers Barbour ABI. 

The expansion is being driven by the rising demand for AI processing power, with most projects expected to be completed within the next five years.

The UK currently has an estimated 477 data centres, making it the third-largest market globally after the US and Germany.

"As AI becomes an undeniable integration in our everyday lives, it’s also a major factor in driving the surge of Data Centre construction projects in the UK," says Megan Pounds, Demand Generation Marketing Manager at Barbour ABI, writing on the company website.

"The UK’s digital infrastructure is relying on more data centres to be built to store and manage data. However, where there is a rise in the demand of building more data centres, there’s also the expected spike in energy usage that must be addressed.

"The strain on the grid isn’t the only concern for this growing sector. Data Centres will have to adapt to help reach the Net-Zero 2050 policy implemented by the UK Government. While many data centres are shifting towards renewable energy sources, the pace of this transition is slower than the growth in demand for data services."

Mapping the UK data centre expansion

More than half of the proposed new facilities will be in London and surrounding counties, while others are spread across the UK. Nine are planned for Wales, one in Scotland, five in Greater Manchester and several in other regions.

Many of the developments are backed by US technology companies such as Google and Microsoft, as well as major investment firms. 

The largest single project would be a £10bn (US$13.6bn) AI data centre in Blyth, near Newcastle, for the American private investment company Blackstone Group. It would comprise 10 buildings covering 540,000 square metres on the former Blyth Power Station site, with construction scheduled to start in 2031 and run for more than three years.

Microsoft is also investing in four UK facilities worth £330m (US$447.3m), with completion between 2027 and 2029. These will include two in the Leeds area, one near Newport in Wales, and a five-storey site in Acton, London. Google is building two data centres in north-east London, costing £450m (US$610m) and covering 400,000 square metres in the Lee Valley water system area.

Economic role and infrastructure pressures

The UK Government classifies data centres as critical national infrastructure, citing their central role in the economy. However, there are concerns about the energy and water demands of the new sites and their impact on bills for consumers.

In the US, newer data centres have been linked to increased household energy costs. 

Dr Sasha Luccioni, AI and Climate Lead at machine learning company Hugging Face, says that in some states “average citizens in places like Ohio are seeing their monthly bills go up by £15 (US$20) because of data centres”. 

She describes the UK’s construction timeline as “aggressive” and calls for companies to bear the cost of the extra power they consume.

The National Energy System Operator (NESO) has estimated that the growth in data centres in Great Britain could add up to 71 TWh of electricity demand over the next 25 years, reinforcing the need for clean energy sources such as offshore wind.

Sustainability challenges

Water usage is another concern. Many existing data centres use large volumes to keep equipment cool, though operators often do not publish consumption figures. 

Steve Hone, CEO of The Data Centre Alliance, says: “Ensuring there is enough water and electricity powering data centres isn’t something the industry can solve on its own,” but stresses that “data centres are fixated with becoming as sustainable as possible” through measures such as dry-cooling methods.

Environmental concerns have already led to local opposition in some areas. In Potters Bar, Hertfordshire, residents are campaigning against a £3.8bn (US$5.2bn) cloud and AI facility planned for greenbelt land. 

In Dublin, a moratorium is in place on new data centres due to the strain they place on Ireland’s electricity supply, with existing sites accounting for a fifth of national demand in 2023.

Last month, Anglian Water objected to a 435-acre data centre proposal in North Lincolnshire, though the developer said it planned to use closed-loop cooling systems to limit water use. 

Twenty-eight of the planned UK data centres would be in areas served by Thames Water, including 14 more in Slough, which already hosts Europe’s largest cluster of such facilities.

Government and industry response

The BBC reports that Thames Water has discussed with the government how to manage water demand from the data centre sector. Water UK, representing water companies, has called for faster resolution of planning hurdles and confirmed that 10 new reservoirs are being developed in Lincolnshire, the West Midlands and south-east England.

Earlier this year, while discussing the UK Government's Plan for Change, Prime Minister Keir Starmer said:

"Artificial Intelligence will drive incredible change in our country. From teachers personalising lessons, to supporting small businesses with their record-keeping, to speeding up planning applications, it has the potential to transform the lives of working people.

"But the AI industry needs a government that is on their side, one that won’t sit back and let opportunities slip through its fingers. And in a world of fierce competition, we cannot stand by. We must move fast and take action to win the global race.

"Our plan will make Britain the world leader. It will give the industry the foundation it needs and will turbocharge the Plan for Change. That means more jobs and investment in the UK, more money in people’s pockets, and transformed public services."

A UK Government spokesperson told the BBC that data centres are “essential” and that an AI Energy Council has been set up to ensure supply keeps pace with demand. They added that £104bn (US$141bn) is being invested in water infrastructure to help meet future needs.