The map of planned data centers shows how badly the UK needs to split its single pricing zone for electricity.
There should be more incentive to build data centers in the north, where there is plenty of renewable power but limited capacity to transport that power south.
Germany also has a single pricing zone and a similar north/south problem. It causes expensive curtailment and redispatch operations whenever the grid cannot physically transport the power from north to south the way it was traded.
I'd imagine that a large part of the demand for data centres in the South is driven by the need for extreme low latency with the City of London and other financial centres like Frankfurt.
It's all well to say there should be more incentive to build data centres in the North, but physics is physics.
Low latency is desirable for stock traders. Most of the data center growth isn't driven by that but by non latency critical workloads such as AI.
The reason, data centers choose to be near London is because there is no pricing advantage to go up north. Even though energy is plentiful, readily accessible, and often curtailed when there's too much of it there. If there was a pricing difference, you'd see a lot more economic activity up north.
Basically the physical advantage is there but the lack of economics cover it up and wipe out the advantage.
It seems fine that financial centers subsidise other regions. GP wasn't asking to ban building the data centers there, just make it more expensive. Because the delivery is more expensive.
which is why the price in electricity isn't truly being reflected properly by the cost of distribution.
If it costs less up north, then there would be incentive to move demand there (for data centers, which is more location agnostic). But if the price is the same up north, then the locality becomes a deciding factor.
that's not a jungle, rights come from a social contract and all the complicated social technology we usually operate to try to manifest said rights.
in a jungle there are niches, and opportunities, and even though there are very strong participants, no one is invincible, especially outside their niche.
the jungle is a place where the social contract is decided by the physically strongest players. the strongest player in the jungle is the man and the jungle only exists because he decided to not level it and turn it into a palm oil farm. in that sense you're right, I completely agree, no one is invincible there.
The existing cluster of data centres in West London pre-dates the current AI boom, and the UK's "IT corridor" is generally based between London and Reading and Oxford and Cambridge. There's an emerging tech hub in the North West, but generally it's not there yet.
> There should be more incentive to build data centers in the north
There are clustering advantages for data centres. Lower inter-cluster latency being key. I do not think the UK market is large enough for two hubs, really.
Doesn’t the electricity move through the national grid fairly well? I don’t don’t disagree though, data centres in the north where there’s more space seems sensible.
1. North-south links in the UK are already fully utilised. There are more in works and plans but not sure it’s enough to meet even existing demand. 2. Transmission losses are substantial.
Transmission in this sense does not include distribution losses (by the DNOs, at lower voltages). 8% in your link.
The UK government is now touting datacentre sites with better access to the national grid (transmission network) to avoid the issues inherent in the distribution networks. E.g. Culham which had a grid connection to power the JET fusion experiments.
Not sure how thing are today but I hear the weirdest story from a German farmer a decade or so ago: They make biogas then turn it into electricity and sell it to the grid for next to nothing. What they really wanted was to pump it into the gas net for domestic use but this wasn't allowed because it is of better quality than the "normal" Russian gas. Apparently someone really cares if some other customer got better gas for the same price(!?)
He was rather pissed off about it. That and some remark that they didn't produce enough gas for the entire country. He said, we are suppose to make enough gas for the entire country but do so without selling it. They did have an association with plans to make biogas from hemp at scale. It just cant happen.
edit: Apparently their law makers came to their senses since.
And it's had scapegoats for just as long! Everything is going according to plan really. It's not the tax scheme, or the zoning, or the construction costs, or the concentration of labor opportunities in London. Don't be daft!
Britain seems interested in actively undoing technological progress for some reason. A deindustrial revolution you might call it!
The UK has very expensive electricity. Nobody builds a data center in the UK unless they need to for regulatory reasons or they got some grant conditional on it being in the UK.
Huge power hungry GPU farms for AI training will end up built elsewhere...
And to avoid simply building more homes. There's been a housing shortage for 50+ years, it's a little late to blame the 2025 datacenter craze for the problem
We have at least recently accepted the Fingleton report's findings (https://www.gov.uk/government/publications/nuclear-regulator...) which is an attempt to get rid of a bunch of administrative blockers. I'm not aware of any new reactors being announced?
The price of electricity in the UK is going up right now to start paying for the next nuclear plant 10 years (fingers crossed) in advance of it generating any electicity.
They literally invented the idea of applying Contracts for Difference from finance to help build nuclear in the UK.
Those have massively helped renewables get built in the UK and elsewhere by letting governments cheaply subsidize financial risk in energy investments while allowing competitive developers to bid the price lower.
But it wasn't enough for nuclear, where the builders didn't want to be on the hook for the inevitable doubling (or worse) of final cost, so they wrote special rules for new nuclear to be paid in advance and not held to cost estimates.
> where the builders didn't want to be on the hook for the inevitable doubling (or worse) of final cost, so they wrote special rules for new nuclear to be paid in advance and not held to cost estimates.
Sounds relatively fair to me - since the vast majority of delays and cost is government initiated (or enabled: e.g. giving power to NIMBY groups). Ideally there are carve-outs for any delays or cost overruns solely the fault of the builders and operators. Projects like these always will have a certain amount of incompetence and graft to them, unfortunately.
Maybe once/if the nuclear industry can get un-destroyed by the government that destroyed it in the first place, these subsidies can go away. If subsidies are good for green energy, they are good for kickstarting the nuclear energy segment again. If countries can successfully hold the line and stick to a 20 year program of increasing the pace and velocity of building new plants a robust industry just might emerge.
Lack of housing is almost always a zoning issue. Builders will always build if there's money to be made and people to sell houses to. The only reason they're not is because they're not allowed to.
You’re often not even allowed to build things that aren’t in keeping with the area even if nobody can see the bits of the property. It’s mostly about stopping people nearby having a nicer house than you.
You could easily build plenty of high rises but they are either insanely overpriced or extremely poor quality in London.
Data centres have big halls, usually no windows whatsoever, and are wide and flat so windows are only possible at the edges. They're even worse for conversion than office buildings.
Better to raze them and build apartment buildings.
The map of planned data centers shows how badly the UK needs to split its single pricing zone for electricity.
There should be more incentive to build data centers in the north, where there is plenty of renewable power but limited capacity to transport that power south.
Germany also has a single pricing zone and a similar north/south problem. It causes expensive curtailment and redispatch operations whenever the grid cannot physically transport the power from north to south the way it was traded.
I'd imagine that a large part of the demand for data centres in the South is driven by the need for extreme low latency with the City of London and other financial centres like Frankfurt.
It's all well to say there should be more incentive to build data centres in the North, but physics is physics.
Low latency is desirable for stock traders. Most of the data center growth isn't driven by that but by non latency critical workloads such as AI.
The reason, data centers choose to be near London is because there is no pricing advantage to go up north. Even though energy is plentiful, readily accessible, and often curtailed when there's too much of it there. If there was a pricing difference, you'd see a lot more economic activity up north.
Basically the physical advantage is there but the lack of economics cover it up and wipe out the advantage.
It seems fine that financial centers subsidise other regions. GP wasn't asking to ban building the data centers there, just make it more expensive. Because the delivery is more expensive.
maybe time to move the city of london's data centers too? meta doesn't have a huge data center in their corporate offices either.
It could be that. Or it could just be that it’s logistically easier to keep your data centre close to your London office.
which is why the price in electricity isn't truly being reflected properly by the cost of distribution.
If it costs less up north, then there would be incentive to move demand there (for data centers, which is more location agnostic). But if the price is the same up north, then the locality becomes a deciding factor.
Throw this in the bin of "fun consequences of price controls".
OTOH a market without a regulator is literally a jungle
a diverse productive ecosystem?
A system in which your the stronger you are, the more rights you have
that's not a jungle, rights come from a social contract and all the complicated social technology we usually operate to try to manifest said rights.
in a jungle there are niches, and opportunities, and even though there are very strong participants, no one is invincible, especially outside their niche.
the jungle is a place where the social contract is decided by the physically strongest players. the strongest player in the jungle is the man and the jungle only exists because he decided to not level it and turn it into a palm oil farm. in that sense you're right, I completely agree, no one is invincible there.
well is the demand about inference or training?
The existing cluster of data centres in West London pre-dates the current AI boom, and the UK's "IT corridor" is generally based between London and Reading and Oxford and Cambridge. There's an emerging tech hub in the North West, but generally it's not there yet.
I have a much better proposal, we move the City of London (not London itself), to the North.
The bankers would learn about scotland and everyone else would be better off.
Please do this, please
the amount of DC space that is actually interested in those extremely low latencies is very small
That plan was rejected later in July 2025, some energy firms say it could have scared off investment https://www.bbc.co.uk/news/articles/cdr3e78112po
> There should be more incentive to build data centers in the north
There are clustering advantages for data centres. Lower inter-cluster latency being key. I do not think the UK market is large enough for two hubs, really.
Doesn’t the electricity move through the national grid fairly well? I don’t don’t disagree though, data centres in the north where there’s more space seems sensible.
1. North-south links in the UK are already fully utilised. There are more in works and plans but not sure it’s enough to meet even existing demand. 2. Transmission losses are substantial.
"About 1.7% of the electricity transferred over the transmission network is lost" https://publications.parliament.uk/pa/cm201415/cmselect/cmen...
Transmission in this sense does not include distribution losses (by the DNOs, at lower voltages). 8% in your link.
The UK government is now touting datacentre sites with better access to the national grid (transmission network) to avoid the issues inherent in the distribution networks. E.g. Culham which had a grid connection to power the JET fusion experiments.
Not sure how thing are today but I hear the weirdest story from a German farmer a decade or so ago: They make biogas then turn it into electricity and sell it to the grid for next to nothing. What they really wanted was to pump it into the gas net for domestic use but this wasn't allowed because it is of better quality than the "normal" Russian gas. Apparently someone really cares if some other customer got better gas for the same price(!?)
He was rather pissed off about it. That and some remark that they didn't produce enough gas for the entire country. He said, we are suppose to make enough gas for the entire country but do so without selling it. They did have an association with plans to make biogas from hemp at scale. It just cant happen.
edit: Apparently their law makers came to their senses since.
Very much doubt this has anything to do with datacenters
London is just slow and bureaucratic af
London has had a housing crisis long before anyone ever dreamed of an LLM.
And it's had scapegoats for just as long! Everything is going according to plan really. It's not the tax scheme, or the zoning, or the construction costs, or the concentration of labor opportunities in London. Don't be daft!
Britain seems interested in actively undoing technological progress for some reason. A deindustrial revolution you might call it!
The current gov is going all in on "ai" to try and solve all their ills so this doesn't sound right.
They say the word AI a lot, that’s for sure, what exactly are they doing though?
Electricity use in the UK peaked in around 2004, and has since been declining. Per capita use is steeply down, but total usage is still 16% down.
That means most grid infrastructure is now under utilised, and skills needed to build any new grid have dried up.
Presumably there are still a few pockets that are at capacity, and that's where the problem lies.
The UK has very expensive electricity. Nobody builds a data center in the UK unless they need to for regulatory reasons or they got some grant conditional on it being in the UK.
Huge power hungry GPU farms for AI training will end up built elsewhere...
It is truly embarrassing the lengths the UK will go to avoid simply generating more electricity.
It's not about "not enought ectricity". It's about they need thicker cables and bigger substations.
Yeah, like building infrastructure stuff!
And to avoid simply building more homes. There's been a housing shortage for 50+ years, it's a little late to blame the 2025 datacenter craze for the problem
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Thanks god we're getting rid of nuclear energy btw.
The UK is building new nuclear (albeit slowly).
Didn't the gov just announce new reactors were being built? In any case UK has a lot of windpower.
We have at least recently accepted the Fingleton report's findings (https://www.gov.uk/government/publications/nuclear-regulator...) which is an attempt to get rid of a bunch of administrative blockers. I'm not aware of any new reactors being announced?
I was thinking of this: https://www.gov.uk/government/news/rolls-royce-smr-selected-...
The price of electricity in the UK is going up right now to start paying for the next nuclear plant 10 years (fingers crossed) in advance of it generating any electicity.
They literally invented the idea of applying Contracts for Difference from finance to help build nuclear in the UK.
Those have massively helped renewables get built in the UK and elsewhere by letting governments cheaply subsidize financial risk in energy investments while allowing competitive developers to bid the price lower.
But it wasn't enough for nuclear, where the builders didn't want to be on the hook for the inevitable doubling (or worse) of final cost, so they wrote special rules for new nuclear to be paid in advance and not held to cost estimates.
> where the builders didn't want to be on the hook for the inevitable doubling (or worse) of final cost, so they wrote special rules for new nuclear to be paid in advance and not held to cost estimates.
Sounds relatively fair to me - since the vast majority of delays and cost is government initiated (or enabled: e.g. giving power to NIMBY groups). Ideally there are carve-outs for any delays or cost overruns solely the fault of the builders and operators. Projects like these always will have a certain amount of incompetence and graft to them, unfortunately.
Maybe once/if the nuclear industry can get un-destroyed by the government that destroyed it in the first place, these subsidies can go away. If subsidies are good for green energy, they are good for kickstarting the nuclear energy segment again. If countries can successfully hold the line and stick to a 20 year program of increasing the pace and velocity of building new plants a robust industry just might emerge.
That's not happening right now.
Once the bubble pops, maybe they can be converted into homes?
Seeing how short all the buildings are in London, its housing shortage is obviously fairly self imposed in that city.
There are plenty of tall new buildings being built.
So many commenters about London on here who don't actually live here.
They are fairly concentraded over small area, meanwhile rest of London is endless sea of small row houses.
Lack of housing is almost always a zoning issue. Builders will always build if there's money to be made and people to sell houses to. The only reason they're not is because they're not allowed to.
You’re often not even allowed to build things that aren’t in keeping with the area even if nobody can see the bits of the property. It’s mostly about stopping people nearby having a nicer house than you.
You could easily build plenty of high rises but they are either insanely overpriced or extremely poor quality in London.
There are a ton of skyscrapers being built. They’re just not particularly affordable
Data centres have big halls, usually no windows whatsoever, and are wide and flat so windows are only possible at the edges. They're even worse for conversion than office buildings.
Better to raze them and build apartment buildings.
That sounds perfect for the warehouse conversion London landlords love!
Subdivide in 16 Shoebox rooms give it a party / commune vibe and laughing to the bank.
Bonus points if it’s not up to building code
Why? Even if the data centers are built for just AI, they can just ditch the GPUs and reuse them for storage etc .. no?
Everyone seems to be carrying a smartphone, continuously creating more high res photos and videos..
It's _never_ going to pop. It'll just inflate and inflate until it's big enough to take us all with it. To the singularity.
Just like shopping malls
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