UK Links Data Center Grid Access to Jobs, Local Investment

UK data centers used for critical services will be given priority access to the grid and the authority to generate power on site, under new rules aimed at speeding up construction of essential infrastructure.

That access will be linked to facilities investing in local communities, creating local jobs and preserving local water supplies, UK Chancellor of the Exchequer John Healey said during his budget speech on Wednesday.

The British Data Centre Covenant will apply to data centers serving entities such as the UK’s health service and the military. The sites will also need to ensure their energy demands don’t create price increases for households and other businesses and should use the heat they produce for district heating projects, according to the budget.

“To ensure our most sensitive data stays under British control, I am setting out a new deal for data centers in the UK,” Healey said. “In return, critical data centers will get the grid connections they need, and, where necessary, be allowed to build on-site generation while they wait.”

The initiative reflects a broader European push to exert greater control over the data, cloud infrastructure and computing capacity underpinning critical services and reduce reliance on US technology companies. The drive for sovereignty creates new hurdles for the American tech firms that dominate much of the market.

The UK’s electricity grid constraints have become a bottleneck for data center development in the country. Microsoft Corp. recently pulled out of a data center agreement with neocloud company Nscale, due to uncertainties over power supply to the site.

Read More: Nscale Says Microsoft Has Withdrawn From UK Data Center Deal

Using new powers under the UK’s Planning and Infrastructure Act, the government will seek to reserve future grid capacity for strategically important projects including some data centers.

If “exceptionally strategic” sites can’t get access to required capacity in time, they may be permitted to use on-site generation until a grid connection can be secured, according to the Budget report.