UK prepared to throw planning rules out the window for massive datacenters

Britain's planning system is still seen as a significant barrier to the development of datacenters.

An industry survey of 3,000 "senior datacenter professionals" found that operators, developers, and consultants believe the current process needs further reform to make it easier for them to build bit barns.

The report, "Powering the Future," comes from consultancy Business Critical Solutions (BCS) and points to the UK government's review last summer to categorize large datacenter developments as Nationally Significant Infrastructure Projects (NSIPs).

This would "shift decision-making from local authorities to the national level, potentially expediting approvals for substantial projects," the report trumpets.

"It is clear from the response to our survey that the planning process needs reform as the sector believes it has been hindered by an overly complex planning system that has lacked clarity," BCS chief James Hart says in the report.

The Labour government only recently made changes to classify datacenters as critical national infrastructure (CNI), meaning they are no longer subject to the same planning restrictions as before. This allows developers to more easily override local objections to proposed projects, as reported by The Register last year.

Categorizing them as NSIPs would appear to go even further. According to the Local Government Association, it would let developers apply to the central Planning Inspectorate (PINS) for a Development Consent Order (DCO), bypassing the local authority.

PINS is responsible for examining an application and writing a report with recommendations to the relevant Secretary of State, who then makes a decision on whether to grant consent.

Local authorities are "statutory consultees" in the DCO process, according to the Local Government Association, but it seems clear that the planning decision is up to the Secretary of State and not them.

A consultation was carried out last year with regard to the broader National Planning Policy Framework (NPPF).

We asked the Cabinet Office for comment, but have yet to receive a response.

In December, the Minister of State for Housing and Planning, Matthew Pennycook MP, made a statement in Parliament that "we will confirm the changes as detailed in the consultation and make it easier to build laboratories, gigafactories, datacenters, and digital infrastructure, and the facilities needed to support the wider supply chain."

"We will follow through with prescribing data centres, gigafactories and laboratories as types of business or commercial development capable of being directed into the Nationally Significant Infrastructure Projects consenting regime, depending on the scale of the project."

Some 92 percent of the respondents to the BS survey welcome a revision of the National Planning Policy Framework (NPPF).

While this might help grow the economy, residents in prime areas for datacenter sites might find that they have no way of objecting to giant campuses being erected near their homes.

The BCS report highlights other hurdles that bit barn builders face in Britain, such as power issues, environmental and sustainability challenges, and the evergreen problem of skill shortages.

The vast majority of survey respondents (90 percent) say the single largest constraint on new UK data campus development is the limitations on power supply, with many citing this as their primary factor in choosing a site.

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Britain has the third largest number of datacenters of any country, according to some estimates, and many are clustered in specific areas such as around London and the M4 motorway corridor heading west. This puts immense pressure on local energy grids, leading to projects being delayed or halted because of constraints on capacity in such high-demand regions.

"The UK government and energy regulators must play a proactive role in addressing these power challenges. Investments in upgrading the national grid are essential to ensure it can handle the rising demand from datacenters while supporting the broader transition to renewable energy," Hart says in the BCS report.

Policies to incentivize operators to put in place decentralized energy generation, like on-site solar panels or local wind farms, could also help alleviate pressure on the grid, he adds.

Bit barns are also under increasing scrutiny for their environmental impact, and the UK's ambitious net zero targets have shone a spotlight on industries with heavy energy footprints, the report notes.

BCS states that while operators are adopting renewable energy and enhancing efficiency, these measures alone cannot fully offset their environmental impact.

It also notes that despite efforts to transition to greener energy, many facilities still rely on natural gas or other non-renewable sources for their backup in case of electrical grid problems.

On skilled staff, almost all survey respondents indicate that they expect to see a fall in the supply of suitably qualified personnel in 2025, amid rising demand from the industry.

In October, UK government signaled eagerness to take the brakes off bit barn development to drive recovery of the economy.

"Datacenters power our day-to-day lives and boost innovation in growing sectors like AI," Peter Kyle, UK Secretary of State for Science, Innovation and Technology, said at the government's International Investment Summit. Several US tech firms used the event to announce more investment in local facilities.

The government also said last year it wanted to streamline the visa process for those with skills in technology to work in the UK, and backed the creation of special zones where it will be easier to build datacenters and other infrastructure they depend on – such as power.

"Ultimately, the UK faces a delicate balancing act. Datacenters are critical to economic growth and technological advancement, but their power needs must be managed sustainably and equitably," Hart says.

Without decisive action, the nation risks falling behind in its digital ambitions or compromising its environmental commitments, he adds. ®