FT 250 executives call for UK grid upgrades to support AI datacentre expansion plans
A poll by the Energy Networks Association reveals FT 250 attitudes towards the state of the UK’s electrical grids
If the UK’s digital economy is to enjoy a prosperous future, the nation’s electricity grids need to be urgently upgraded to ensure the datacentres underpinning it all have a consistent and reliable supply of high-capacity power.
That’s according to a poll of 101 FTSE 250 executives, commissioned by the Energy Networks Association (ENA), where 90% of participants said they believe that upgrading the grid is “essential to unlocking high-growth industries”, while more than 80% said the UK cannot compete globally without these upgrades.
“This requirement is particularly acute for datacentres, which underpin AI [artificial intelligence] model training, cloud computing and the broader tech ecosystem,” said the ENA, in a statement.
Of those polled, 55% said they are confident the UK can become a global leader in AI, for example, but realising this ambition hinges on the availability of reliable, high-capacity power.
Furthermore, 75% of those questioned said planned grid improvements would enable their business to invest and grow in the UK, with just 19% stating that they think the current grid is sufficient to meet the future energy demands of high-growth industries.
“This polling shows a high level of confidence among UK business leaders in our ability to lead the world in clean energy, advanced manufacturing, life sciences and digital technology,” said Energy Networks Association CEO Lawrence Slade. “They see the UK’s potential to dominate the industries of tomorrow, and the benefits this would bring for jobs, investment and growth,” he said. “But they are equally clear that this opportunity is not guaranteed. It hinges entirely on a future-ready electricity grid.
“Without it, we risk losing our competitive edge and missing out on the economic, environmental and social gains that are within our grasp. Decisions made this year will be pivotal for securing the private investment network operators need to make this future-ready grid a reality.”
Concerns about the UK grid’s ability to withstand the number of datacentres being planned and built have been circulating for years, but have ramped up more recently in the wake of the government’s rhetoric about wanting to become an AI superpower.
In line with this, there has been a flurry of announcements from datacentre developers about their plans to build hyperscale, high-performance compute and AI server farms across the country, which typically consume more energy than a traditional datacentre.
According to the UK government’s own figures, domestic datacentre capacity could rise to between 3.3GW and 6.3GW by 2030, mainly due to the growing demand for AI workloads, which will place further pressure on the grid.
Teodora Kaneva, head of smart infrastructure and systems at TechUK, said the government has acknowledged the pressure these datacentre developments will put on the grid, and allocated “significant investment” in the nation’s energy infrastructure as a result.
“Now we must focus on how we can deliver at pace to deliver on national ambition, [because] delays in power provision prevent the construction of new digital infrastructure and science parks, driving investment elsewhere,” she said.
“This is not only an issue for the UK tech sector itself, but it also affects the chancellor’s AI and life sciences ambitions. Reliable, affordable and flexible power is essential for the government’s growth mission.
“With an increasingly polarised debate on infrastructure delivery, politicians from all parties must come together to champion this vital national infrastructure,” said Kaneva.
Transition to clean energy sources
Tania Kumar, policy director for net zero at the Confederation of British Industry, said grid upgrades are also needed to enable the UK’s transition from non-renewable to clean energy sources.
“Without a modern, expanded network, we cannot deploy the renewable capacity required, nor can we fully harness the potential of technologies such as offshore wind, solar, hydrogen and small modular reactors,” she said.
“The UK government has taken important steps to support this transformation, and continued leadership will be vital to delivering energy security.
“As electrification spreads across key sectors of the economy, accelerating grid development and streamlining connection processes must be top priorities to unlock growth and attract investment,” said Kumar.
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