The amount of electricity required for new UK data center projects is expected to exceed the country’s current peak electricity consumption, an industry watchdog has said.
Ofgem said around 140 proposed data center schemes, which would promote the use of artificial intelligence, could require 50 gigawatts of electricity, which is 5 gigawatts more than the country’s current peak demand.
The figures were revealed during an Ofgem consultation into the demand for new connections to the electricity grid. The report noted that there was a “surge in demand” for connected applications between November 2024 and June last year, with a significant number coming from data centers. This exceeded even the most ambitious predictions.
Meanwhile, new renewable energy projects are not being connected to the grid at the pace they are being built to meet the government’s clean energy targets by the end of the decade.
Mr Ofgem said the work required to connect a rapidly growing number of data centers could mean delays to other projects “crucial for decarbonisation and economic growth”. Data centers are the nerve center of AI tools such as chatbots and image generators, and play a key role in the training and operation of products such as ChatGPT and Gemini.
Rapid increases in energy consumption could make it harder for the UK to meet its goal of creating a virtually carbon-free electricity system by 2030, a goal already in jeopardy amid concerns about rising electricity costs in the country.
The Guardian revealed last year that a vast data center proposed for Elsham, Lincolnshire, could cause more greenhouse gas emissions than five international airports.
Some technology company leaders and climate experts believe that AI could help fight global warming by making power grids more efficient and accelerating the development of new zero-carbon technologies, but there are growing concerns that in the short term data centers will increase demand for fossil fuels to meet energy needs.
Ofgem also said unviable applications for grid access could hinder progress on key data center tenders, such as those related to the government’s AI growth zones. These zones are touted to offer a streamlined planning process and support access to energy, and were announced last year as part of plans to expand the UK’s AI uptake.
Regulators are proposing tougher financial tests for data center developers to join the queue to connect to the grid to avoid creating a backlog of poorly funded projects and delaying viable projects further down the queue.
Ofgem said data centers must be at the center of changes to the application process for electricity connections, describing the issue as a “global challenge” and saying there was no mechanism to prioritize projects that ministers deemed strategic imports.
Regulators are considering charging data center providers a deposit or non-refundable fee for access to energy connections. This could also prevent “unviable” projects from stalling the application process. Ofgem is also considering whether data center developers should pay and build their own grid access. Doing so would “enable faster connections and better outcomes for consumers.”
