Planned data centre developments could be prioritised for electricity grid connections under new government proposals designed to reform the current application system.
The proposed changes come after the existing grid connection process was overwhelmed by speculative applications from developers seeking future access to electricity infrastructure.
Applications for grid connections surged by around 450% last year, creating a backlog that has left some projects facing waits of up to 15 years before being able to connect to the national energy grid.
Under the new proposals, projects considered strategically important to the UK’s economic and energy transition goals would move ahead in the queue. These include data centres and AI Growth Zones, electric vehicle charging hubs and electrified industrial sites.
The reforms are also expected to discourage speculative applications by increasing deposit fees required from developers seeking grid connections.
Kayte O’Neill, Chief Operating Officer at National Energy System Operator, said the scale of demand highlighted strong investment interest but stressed the need for the connections pipeline to reflect deliverable projects.
She said: “the surge in demand applications shows the strength of investment interest across Great Britain, but the demand connections pipeline must reflect projects that are credible, ready and committed to progressing.
“We are committed to working with government, industry and Ofgem to prioritise strategically important projects, while removing speculative applications.
“This will ensure data centres, industrial sites and vital public services can access clean, reliable power, while also supporting growth, innovation and jobs across Britain.”
However, planning consultants have warned that prioritising certain sectors could have unintended consequences for other parts of the development industry, particularly housing.
Lawrence Turner, director at Boyer, said: “The Government is right to clamp down on speculative grid connection requests if the queue has genuinely become clogged with projects that were never likely to move forward.
“However, the reforms go much further than tidying up the system. By signalling that sectors such as AI data centres and major industrial projects may be prioritised, ministers are effectively introducing politics into planning, by deciding which types of development get electricity first.
“That has real implications for developers. For many of our commercial and industrial clients, particularly those involved in data centres, logistics and advanced manufacturing, these changes could unlock schemes that have been stuck behind speculative projects in the queue.
“But there is a flip side. Housing delivery increasingly depends on access to grid capacity, and in some areas, power constraints are already slowing development.
“If strategic infrastructure begins to receive preferential access to electricity connections, there is a real possibility that new homes could find themselves competing with server farms for power.
“The question becomes is, when electricity is scarce, do we power servers first, or homes? Both are strategic development.”
