Datacentre sector hits back at claims that West London electricty grid capacity crunch is its fault


The notoriously secretive datacentre industry has found itself villainised by the national press as being an insatiable, power-hungry entity that is sucking the West London electricity grid dry and exacerbating the capital’s housing crisis.

This is on the back of a briefing note, distributed to property developers and trade associations on 22 July by the Greater London Authority’s (GLA) Development Service, entitled West London electrical capacity constraints, that said a “rapid influx” of server farms along the M4 corridor has left the electricity transmission and distribution networks in the London boroughs of Ealing, Hillingdon and Hounslow suffering capacity issues.

“Datacentres use large quantities of electricity, the equivalent of towns or small cities, to power servers and ensure resilience in service,” said the note, seen by Computer Weekly. “The scale of electricity demanded by these datacentres… [has absorbed] the remaining electricity capacity in SSEN’s [Scottish and Southern Electricity Networks] West London region for the remainder of the decade.” 

As a result, the developers of major housing, commercial and industrial developments have told the GLA that they face a wait of “several years” to have their builds hooked up to the grid, with some applicants being told it could take until 2035 to get a grid connection.

The Financial Times ran a story about the note’s contents, with the headline “West London faces new homes ban as electricity grid hits capacity”.

However, it appears the contents of the GLA’s briefing note may have been sensationalised somewhat, with energy market sources telling Computer Weekly that there is no immediate shortage of power capacity in West London.

“Instead, the constraints discussed are the volumes contracted in some cases for post-2030,” they said. “There is no ban on new-building housing developments due to electricity connections.”

Eddie Lavery, Hillingdon Council’s cabinet member for residents’ services, described the Financial Times reporting of the matter as a “somewhat scaremongering story” that had “blown the reality of the situation out of proportion”.

He said: “We are not aware of any housing schemes planned for the borough being affected. There is also evidence that power capacity has been reserved for developments that may never take place and this latent capacity should be made available to schemes that will be delivered.

“We understand the GLA is working hard to resolve the situation as quickly as possible. In the meanwhile, we have every confidence we’ll be delivering on our housing promises.”

Matthew Evans, director of markets at TechUK, told Computer Weekly that the tech trade association had received a clarifying statement from the GLA that reiterated that there is no ban on new housing developments because of the datacentre sector’s rapid growth in West London.

“In a recent statement of clarification following a roundtable with the Data Centre Council at TechUK, the GLA has stated that the West London electrical capacity constraints document does not imply a ‘ban on future housing’ in London, as previously reported by a few news articles,” said Evans.

“TechUK and the [datacentre] operators we represent welcome this clarification, which dispels the adversarial framing in favour of one of cross-industry collaboration. We believe that getting the relevant stakeholders around the table is the only way to solve the current crises.”

Several days after the Financial Times article appeared, The Daily Telegraph published an article about the GLA’s note, in which it described datacentres as being “energy vampires” that are “sucking Britain’s grid dry”.

It is fair to say the datacentre industry has not taken kindly to being characterised in this way, given that some operators are pairing their West London datacentre builds with investments in propping up the grid in the surrounding area.

Colt Datacentre Services got the green light from Hillingdon Council’s Major Applications Planning Committee in April 2022 to proceed with its plans to build a £400m campus comprising two datacentre buildings in Hayes, West London.

An infrastructure assessment carried out as part of the planning process concluded that there was “insufficient electrical capacity to meet the requirements of the new datacentre”, as detailed in a planning document circulated to committee members and seen by Computer Weekly. 

However, Colt has agreed to fund the “reinforcement” of a local electricity substation and cover the cost of new cables and connections at another substation closer to its proposed datacentre.

These upgrades will take four years to complete and will provide “additional capacity for other users and allow expansion into the 2030s”, the report said.

“Accordingly, the applicant has taken proactive steps to meet the infrastructure requirements of the development and demonstrates the scheme will not negatively impact future electricity suppliers within the Hayes area,” the document added.

Datacentre industry scapegoat for government under-investment

The prevailing feeling among the datacentre industry players Computer Weekly spoke to about the GLA’s note (and the press coverage of it) is that the sector is being made a scapegoat for years of under-investment by successive governments in the UK’s energy generation, transmission and distribution networks.

As proof of this, Ed Ansett, chair and founder of datacentre engineering consultancy firm i3 Solutions Group, pointed out that the lack of capacity in the UK grid has been a source of ongoing concern and discussion for more than 15 years.

“The moral panic being created about datacentres preventing housing development in West London comes hot on the heels of a week in which it was reported that the UK procured power from Belgium at a record price of nearly £10,000 a megawatt hour, which is 5,000% higher than typical, to overcome a potential blackout caused by a coalition of peaking power demand and a bottleneck in the grid,” Ansett told Computer Weekly. “The shortcomings of UK grid capacity are not new.”

Further proof of that is the work of Ian Fells, an Emeritus professor of energy conversion at the University of Newcastle upon Tyne, who has written and spoken prolifically in the past about the shortcomings of the UK grid.

In a 2008 article for The Engineer, Fells spoke of the need for “considerable investment” to be made in the National Grid and the nation’s own energy generation capabilities in the light of the UK’s growing electricity usage.  

“For the past 15 years at least, he has been very vocal about the lack of capacity in the UK grid, pre-dating by some considerable time the expansion of the datacentre sector, which has been a hallmark of recent years,” said Ansett. 

The Institution of Mechanical Engineers also raised a red flag in 2016 about the looming risk of an “electricity supply crisis” in the UK, as the government had failed to build sufficient replacement sources of energy generation ahead of its plans to close all coal-fired powers stations by 2025.

And Computer Weekly has unearthed further and more recent evidence that suggests the government is still dragging its feet on matters of the UK’s energy security.

When Computer Weekly initially contacted the GLA for comment on this story, it received a statement on 27 July that said the London mayor, Sadiq Khan, had written to the Department for Business, Energy and Industrial Strategy (BEIS) “weeks ago” to request a meeting to discuss the electricity capacity issues in West London, but the request was declined.

Several days later, and after the story garnered further national and tech press coverage, the GLA gave Computer Weekly an updated statement that confirmed Khan’s meeting request with BEIS had now been accepted. “In the midst of a housing crisis, he is calling on the ministers to work with him to resolve this issue urgently,” the statement read.

Cross-industry collaboration to boost grid stability

The GLA document said the West London capacity constraints are particularly acute in Hounslow and Ealing, but parts of Surrey and Berkshire – including the datacentre hub town of Slough – are also feeling the energy pinch.

The document also featured a call to arms from the GLA directed at property developers, datacentre operators, local councils and regulators to provide it with feedback on how best to generate more grid capacity. 

“Our collective aim is to help find innovative solutions to mitigate the immediate constraints, unblocking developments that may otherwise be delayed or stopped in their entirety, while ensuring economic development is not adversely affected,” the GLA document said.

i3 Solutions Group’s Ansett said one way the datacentre industry can lend its support to the GLA is by making the huge amounts of spare power capacity they hold available to the grid.

“One thing which today is not being considered [enough by operations] is the amount of spare power capacity actually held by datacentres, together with their power generating and energy storage capabilities,” he said.

“Taken together, this capacity runs into gigawatts of power – enough to avoid the requirement to build at least two power stations, and certainly a game-changer in terms of the power that could be made available to support the grid at times of peak demand.”

This would require datacentre operators to become active participants in demand response schemes, which would require some “easily made adjustments” to their server farm setups so the power stored in their backup generators – for example – could be made available to the grid during peak times.  

“In simple terms, datacentres could disconnect from the grid and run on their own generators – or generate directly into the grid,” said Ansett. “Either way, as an energy-intensive industry, it would make sense for the grid to have a dialogue with the datacentre industry, at the same time gaining insight to the sector’s power requirements and capacity when shortages are forecast.”

Rees Westley, head of utilities at datacentre design consultancy Business Critical Solutions (BCS), said his firm has been advising the operators it works with to do their bit to ensure their operations do not put undue and additional pressure on the grid for a while. 

“We are currently advising clients on a number of solutions to reduce their reliance on the National Grid, including creating more efficiency and/or scaling back on size,” he said. “In some cases there is the option to consider generating their own power to supplement any shortfall, utilising renewable power such as wind, hydro, solar and waste to energy.  

“This can be built by the datacentre owner or funded by one of the growing number of financial institutions that are starting to invest in power generation as they see the demand and resulting opportunities. However, the reliability of this type of renewable energy is not guaranteed as it isn’t always sunny or windy, so this often needs to be linked to a form of battery storage.”

Another way operators can help is by broadening their horizons when deciding where best to locate their datacentres and maybe consider opening sites where there is surplus grid capacity, said Westley.

“We have a scenario where we have a concentration of demand in West London and the National Grid is so constrained that it is unable to import or export power,” he said. “On the other hand, the Scottish network is under-utilised to such an extent that it is being switched off at times as it isn’t being used. There is also significant alternative power generation through on and offshore wind turbines.

“The issue is that the lines that run from north to south are constrained and are unable to move power between them. Construction work to address this is currently under way but will take around eight years.

“This means that the more power-hungry facilities will need to consider locating in the north of the country. This makes sense as we are seeing more industry doing the same, such as Rolls-Royce.”

Such a strategy might require some trade-offs to be made, given that one of the main reasons why the M4 corridor is such a popular location for datacentres is how well connected it is, which is important for operators that want to offer end-users low-latency connectivity.

The M4 corridor is served by transatlantic cables that run from Cornwall to London, and locating a datacentre further afield might mean having to compromise on connectivity speed for power and the opportunity to get server farms built more quickly.

The GLA has given stakeholders until today (Friday 5 August) to put forward suggestions about how best to address the grid’s supply constraints, and – no doubt – the datacentre community will be waiting with bated breath to see what the implications of this consultation exercise might be for it.

In the meantime, the Energy Networks Association, which represents the interests of UK and Ireland’s energy networks business, said it is using “every tool available” to manage the situation.

“Electricity networks are using every tool available, including deploying innovative technologies, to accelerate connections and ensure that future demands are managed as efficiently as possible,” a spokesperson told Computer Weekly.

“There is significant collaboration across the industry, the Greater London Authority and with the housing developers themselves to address these challenges, but a long-term approach to investment is needed. We are in dialogue with [regulator] Ofgem to make changes to their reactive regime and ensure that where new infrastructure is needed, network companies can build it once and build it right.”



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