Data Centres: Electricity
The question
To ask the Secretary of State for Energy Security and Net Zero, what steps he is taking to ensure that electricity demand from data centres does not (a) adversely impact energy security and (b) increase costs for (i) households and (ii) businesses.
Answered by Michael Shanks
The electricity system benefits from a diverse energy mix, with the Capacity Market ensuring supply meets demand.
The Government is committed to ensuring electricity networks can meet rising electricity demand, including from data centres. The Capacity Market ensures supply meets demand. It operates by securing most of the required capacity four years in advance, with additional capacity secured one year ahead based on updated forecasts. This approach ensures Great Britain meets the Reliability Standard, which balances cost and reliability to maintain adequate electricity security.
As a part of the AI Growth Zones programme, the government will encourage data centres to locate in areas where their energy demand reduces the strain on the system by utilising excess renewable energy generation (such as Scotland, Cumbria and the North East). The design of this policy is ongoing and will soon go out to consultation.
Cost controls will be incorporated, to minimise the risk of any gap between price support and constraint costs appearing on consumer bills.
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