The expansion of data centres in the United Kingdom is prompting concerns from energy regulators and industry leaders about potential increases in household energy bills and public backlash. Currently, the UK has approximately 500 data centres, but this number is expected to grow by more than a third, driven by a government-supported initiative aimed at economic growth. However, many of these facilities have already encountered local opposition due to their significant energy consumption.

Tim Jarvis, the newly appointed chief executive of Ofgem, the UK’s energy regulator, cautioned that the rapid growth of data centres could provoke negative reactions if not managed carefully. He emphasized the importance of prioritizing suitable projects and ensuring that developers cover sufficient costs related to connecting their facilities to the national electricity grid. Jarvis pointed to examples from the United States and Ireland, where communities have pushed back against data centres consuming substantial electricity, noting that in Ireland, data centres account for about 20% of the country’s electricity usage. Protests have occurred recently, including one at an artificial intelligence summit where demonstrators decried data centres as “energy vampires” and “job robbers.”

Ofgem reported that around 80 gigawatts (GW) of data centre projects are currently seeking grid connection, with approximately 50GW considered advanced enough to move forward. To put this into context, 50GW exceeds the UK’s total electricity demand on a typical winter day, highlighting the scale of potential new energy consumption. A decision has yet to be made on how the costs of grid connections will be allocated between developers and consumers.

Fintan Slye, chief executive of the National Energy System Operator (Neso), responsible for maintaining the country’s electricity supply, described data centres as the most significant recent development affecting the energy system. Slye remarked that if data centres are strategically placed and designed to have flexible energy demands, they could provide benefits. For instance, locating them in Scotland could help absorb excess electricity generated by offshore wind farms, which sometimes must be curtailed due to limited transmission capacity to southern regions.

Despite the potential advantages, Slye warned that a poorly managed rollout could result in higher energy prices and operational difficulties within the system.

The comments came as Miatta Fahnbulleh, the energy secretary appointed in July by Greater Manchester mayor Andy Burnham, acknowledged challenges within the UK’s energy infrastructure. Fahnbulleh highlighted the dual priorities of securing affordable energy bills for consumers and advancing electrification efforts, such as transitioning heating and transport to electricity. Speaking at the Energy UK conference in London, she noted that public perception of the energy system’s success is measured not in technical metrics like gigawatts, but in the cost of their energy bills.