Data centres, essential facilities that house processors powering cloud computing, have been designated as ‘critical national infrastructure’ by the UK government, reflecting their central role in the digital economy. With the rise of technologies such as artificial intelligence, these data hubs provide the power, connectivity, and security necessary for a vast range of online activities, from personal browsing to advanced AI learning.
The UK currently stands as Europe’s largest data hub, boasting over 500 data centres, primarily concentrated in the South East region. Slough, located in west London, has long been the industry’s historic heart due to its strategic proximity to transatlantic data connectors and the City of London, which was initially the largest consumer of computing power, particularly from financial services and banking.
While the recent government classification underscores the importance of data centres, industry leaders have called for a broader strategic approach to address the increasing demand for data processing, especially with the surge in power-hungry AI chips. This demand presents significant challenges, including high land prices, competition for grid connections, and resistance from local residents, all of which have hindered expansion in the traditionally dominant South East.
In response to these challenges, some companies are seeking to establish their operations outside of the conventional hubs. Kao Data, a prominent player in the industry, has initiated plans to diversify its presence beyond the South East. The company recently broke ground on a £350 million development project in Stockport, Greater Manchester, aiming to expand its campus in Harlow, Essex. This move reflects a growing trend among data centre operators to seek out new locations that can accommodate their expansion needs.
As the demand for data processing continues to escalate, the UK’s data centre industry is at a pivotal juncture. The government’s recognition of data centres as critical infrastructure highlights their significance, but industry experts stress the necessity for a cohesive strategy that facilitates expansion while addressing local concerns. As companies explore opportunities beyond the South East, the evolution of the data centre landscape in the UK is poised for transformative growth, driven by technological advancements and the increasing reliance on digital services.