Data centre development at the centre of UK AI plan

Robbie Owen of Pinsent Masons said the move would support the government’s plans to create ‘AI growth zones’ across Britain without first having to pass a new Act of parliament.

The creation of dedicated AI growth zones was recommended by entrepreneur Matt Clifford in a new report published on Monday, the AI opportunities action plan. The government has endorsed all the recommendations from the report, with the idea of AI growth zones being to “speed up planning approvals for the rapid build-out of data centres, give them better access to the energy grid, and draw in investment from around the world”, the government said in a statement.

The first AI growth zone will be in Culham, Oxfordshire. The government said it would announce further zones in the summer.

“Today’s announcement and action plan underline the national significance of data centres along with other aspects of ‘the modern economy’,” said Owen. “The planning system needs to reflect that. In December, ministers said as part of the new National Planning Policy Framework that they would be making changes so that the ‘nationally significant infrastructure projects’ planning regime could improve how it is set up to consent, in addition to infrastructure, nationally significant ‘business and commercial projects’ including data centres. This initiative, like data centres themselves, should now be turbo charged.”

“Primary legislation is not required immediately and revised government guidance could be put in place quickly with reference to AI growth zones, so that local authorities are not allowed to exercise an effective veto on data centres being able to be consented centrally where appropriate, as a nationally significant business and commercial project,” he said.

Mike Pocock, who also specialises in planning law at Pinsent Masons, added: “In addition to the action plan proposals, there are also other opportunities through the planning regime to help accelerate the build out of data centres, such as creating a bespoke planning use-class and considering the case for AI data centres to be eligible for relevant relief schemes that incentivise private sector investment.”

“Together with the mooted changes to the nationally significant infrastructure projects regime, such changes would help streamline the consenting process and accelerate the provision of data centres,” he said.

The action plan also identified scope for the government to use AI growth zones to drive local rejuvenation, channelling investment into areas with existing energy capacity, such as post-industrial towns and coastal Scotland.

The government said the AI growth zone in Culham will serve as “a testing ground to drive forward research on how sustainable energy like fusion can power our AI ambitions”. The UK’s Atomic Energy Authority is based in Culham.

Under the AI opportunities action plan, a new AI Energy Council will also be created. It will be chaired by the secretaries of state for science and energy. They will work with energy companies “to understand the energy demands and challenges which will fuel the technology’s development” and could see energy technologies like small modular reactors deployed to power AI-related data processing activities, the government said.

Michael Freeman, an expert in nuclear projects at Pinsent Masons, said: "AI and data centres provide huge potential benefits to the UK, but they also pose significant questions around energy consumption. Small Modular [nuclear] reactors (SMRs) have for some time been seen as the solution to data centres’ increasing and evolving energy demand – their scalability, reduced radiological risk and zero carbon profile has seen US data giants such as Amazon and Microsoft recently committing to the idea of co-locating their data centres alongside new SMR development."

"In the UK, if co-location is to become a reality, the government needs to accelerate the positive work it is already doing with the SMR supply chain, and in particular address how the planning and regulatory frameworks might be clarified, to encourage the co-location vision to become a reality," he said.