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Data Centres: Boom and Backlash
18OCT

GB Grid opens self-build to data centres

3 min read
13:11UTC

The UK government created GB Grid on 29 September, a state-owned rival to the network operators that will let businesses build their own grid connections and co-invest in them.

IndustryDeveloping
Key takeaway

GB Grid lets businesses build and co-fund their own grid links, but adds no capacity.

The UK government announced GB Grid on 29 September, a state-owned company inside Great British Energy, the publicly owned energy company, created to compete with existing network operators⁠1. Businesses will be allowed to build their own connections, with GB Grid able to co-invest. That speeds the wiring but adds no generation and no network capacity.

In March ministers gave AI Growth Zones, government-designated sites promised faster planning and grid access, the right to build their own high-voltage lines. GB Grid offers a version of that route, with state money, to any business. City AM, citing figures from Ofgem, Britain's energy regulator, put data centres at no less than 80 GW of the queue of demand waiting for a grid connection; other Ofgem papers put it near 73 GW. Either figure is well over Britain's national peak demand of about 45 GW.

CX Tech has lodged a 1,000 MW application for a campus near the former Chapelcross nuclear power station in Dumfries and Galloway, a record by City AM's count⁠2. At 1,000 MW, that one request equals more than 2% of the national peak. A self-built line can bring a site like that to the edge of the network sooner; whether the network behind it can carry the load is a separate question GB Grid does not answer.

Deep Analysis

In plain English

To plug a big building into the national grid, someone must build cables and equipment from the building to the network. In Britain that usually means waiting for the network company to do it. The government now wants to let businesses build their own connections. It has also created GB Grid, a new company owned by the state, which can help pay for them. This could speed up connections, but it does not add more power stations or more capacity on the main network.

Deep Analysis
Root Causes

Britain's networks are regulated monopolies under Ofgem's RIIO price controls, which fund investment against approved business plans. Lines are built when the regulator agrees the need, so demand from new sectors waits for the next plan or a reopener.

A demand queue far above Britain's peak load reflects how cheaply a connection application could be lodged and held. Ofgem and the National Energy System Operator reformed the queue in 2025 because speculative applications held places ahead of projects ready to build.

What could happen next?
  • Opportunity

    Developers near existing transmission corridors may connect faster by building their own links with GB Grid co-investment.

    Medium term · Assessed
  • Risk

    Public co-investment exposes Great British Energy to stranded assets if data-centre projects are cancelled.

    Long term · Suggested
  • Consequence

    Scottish projects such as Chapelcross remain bound by the Scottish planning pause regardless of the connection route.

    Short term · Assessed
First Reported In

Update #16 · Malaysia bills data centres for idle grid

Resultsense, reporting City AM· 18 Oct 2026
Read original →
Different Perspectives
Nexus Core Systems
Nexus Core Systems
Hired FiveNines Group, in a deal announced on 8 October, for early design, feasibility and permit work on a 20 MW AI data centre near Casablanca. It is the first named site of a planned 180 MW programme, still at concept design.
MC Digital Realty
MC Digital Realty
Began building the 24 MW KIX15 data centre in Osaka Prefecture on 7 October, due to open in the fourth quarter of 2028. The joint venture of Digital Realty and Mitsubishi Corporation says it will then run 10 data centres in Japan with about 220 MW of IT capacity.
KT Cloud
KT Cloud
Said on 7 October that it and Hyundai Engineering will build a 50 MW AI data centre at Cheongna, Incheon, from the fourth quarter of 2026. Completion is due in the first quarter of 2030, part of KT Cloud's target of more than 1 GW of AI capacity by 2031.
Town of Trebbin
Town of Trebbin
Said on 7 October that work has begun on two data-centre buildings and a substation under building permits already granted. The operating permit under the Federal Immission Control Act is still with Brandenburg's environment agency, so the town postponed its public presentation.
Óscar López, Digital Transformation minister
Óscar López, Digital Transformation minister
Said in Madrid on 8 October that he hopes to approve the data-centre royal decree shortly, with urgent processing to reach the cabinet before the 29 November election. He said the final text will take the more than 600 submissions into account, without saying what changes.
Hydro-Québec
Hydro-Québec
Defended its proposed Tarif CD before the Régie de l'énergie du Québec from 1 to 9 October, a rate for data centres of 5 MW or more that adds a premium when peak demand stays below 60% of forecast. Industrial consumers filed their own wording for the clause on who the rate covers.

Written with AI from Lowdown's published reporting. Not individually reviewed by an editor. Editorial standards.