Data center projects worth £14 billion ($16.96bn) have been announced as part of a new AI action plan launched by the UK government.
The plan proposes creating AI growth zones to help encourage data center developments and pledges to build a new supercomputer to boost UK compute power.
Alongside these government-driven initiatives, businesses Vantage, Nscale, and Kyndryl have all committed to invest in UK digital infrastructure, and the projects will create 13,250 jobs, Downing Street said.
The UK’s AI Opportunities Action Plan
The plan is based on 50 recommendations from Matt Clifford, the founder of startup incubator Entrepreneur First and chair of the government’s Advanced Research and Innovation Agency.
Clifford was commissioned to work on the plan after the July 2024 UK general election, and the government has said it will adopt all 50 recommendations.
The plan has three pillars, the first of which, “laying the foundations for AI to flourish in the UK,” relates to digital infrastructure.
As part of this, the government says it will set up what it calls AI Growth Zones, areas across the country that will “speed up planning approvals for the rapid build-out of data centers, give them better access to the energy grid, and draw in investment from around the world.”
First reported in November, these zones will also serve as “a testing ground to drive forward research on how sustainable energy like fusion can power our AI ambitions,” a government statement said.
The first AI Growth Zone will be built in Culham, Oxfordshire – home to the UK’s Atomic Energy Authority - with more to be announced later this year. AWS and CloudHQ already operate data centers near Culham.
Alongside this, the UK government says it will build a new supercomputer with “enough AI power to play itself at chess half a million times a second.” Hopefully it will have more practical applications, too, but details of the computer’s location, compute power, and price tag have not been revealed.
A launch date for the supercomputer has not been announced either, with the Department for Science, Innovation, and Technology (DSIT) saying only that it is “part of the plan to increase compute capacity by twenty-fold by 2030 – supercharging our capacity to power AI products.” DCD has contacted DSIT for further information.
Last year, the government shelved tech and AI projects worth £1.3 billion ($1.66bn) announced by the previous administration, stating that funding had not been allocated to the projects. These included the UK's first exascale supercomputer that was set to be built at the University of Edinburgh, and funds for the AI Research Resource (AIRR).
The full list of recommendations includes a call to expand the capacity of the AIRR by 2030 so that it is twenty times larger. Clifford's review also says the government should set out a long-term plan for the UK’s AI infrastructure needs, backed by a 10-year investment commitment. Mission-focused “AIRR program directors” should also be appointed and given autonomy to allocate compute resources to their particular industry or sector, the report says.
The other pillars of the strategy relate to boosting AI adoption in the public and private sectors and spotting future opportunities.
Clifford said: “This is a plan which puts us all-in - backing the potential of AI to grow our economy, improve lives for citizens, and make us a global hub for AI investment and innovation.
“AI offers opportunities we can’t let slip through our fingers, and these steps put us on the strongest possible footing to ensure AI delivers in all corners of the country, from building skills and talent to revolutionizing our infrastructure and compute power.”
New UK data centers announced to boost AI opportunities plan
Three companies have confirmed data center investments in the UK as part of the announcement.
GPU cloud provider Nscale says it is investing a total of £2.5 billion ($3bn) in the UK, and will build its first UK data center on land it has purchased in Loughton, Essex.
The site will support 50MW of AI and high-performance computing (HPC) capacity, and has a total power allocation of up to 90MW.
Nscale hopes it will go live in Q4 2026, and will be ready to house up to 45,000 Nvidia GB200 GPUs. The company said the project would support 500 construction jobs and up to 250 full-time roles.
Josh Payne, CEO of Nscale, hailed the news as a “significant milestone” for the company.
He said: “This expansion will help us meet the growing demand for generative AI by deploying advanced GPU clusters more efficiently. Additionally, capital from our recent funding round will accelerate our global 1.3GW pipeline of greenfield data centers, with 120MW planned for development in 2025. This underscores our commitment to delivering sustainable, scalable AI infrastructure that drives innovation and economic growth."
As well as the Loughton build, Nscale said it will “begin construction of multiple modular UK-based data centers in Q3 and Q4 of 2025, with further expansion of fixed data centers slated for the following years.”
The firm launched last year and is a sister company of cryptomining company Arkon Energy.
Elsewhere, and as reported by DCD last week, Vantage is constructing a 10-building campus on the site of a former Ford car plant in Bridgend, Wales. Today’s announcement says this is part of a £12 billion ($14.55bn) investment in UK data centers that will create more than 11,500 jobs.
Vantage already has a presence in Wales after it bought Next Generation Data, which runs a campus outside Cardiff and a site in Newport, in 2020, and has an existing campus in London.
IT services provider Kyndryl is set to create up to 1,000 AI-related jobs in Liverpool over the next three years at a new tech hub. It is unclear whether this will involve any new digital infrastructure. DCD has contacted the company to request further details.
The UK government’s data center and AI ambitions
Since taking office in July, the UK government has signaled its intention to attract more data center investment to the country.
To help do this, it has designated data centers as critical national infrastructure and pledged to reform planning laws to make it easier to build new facilities on greenbelt land.
Ministers are also looking at some data center applications that have been rejected by local planners. In December deputy prime minister Angela Rayner gave the green light to a development in Buckinghamshire which had been rejected by councillors who labeled the project inappropriate.
Prime minister Keir Starmer said: “The AI industry needs a government that is on their side, one that won’t sit back and let opportunities slip through its fingers. And in a world of fierce competition, we cannot stand by. We must move fast and take action to win the global race.”
He added: “Our plan will make Britain the world leader. It will give the industry the foundation it needs and will turbocharge the Plan for Change. That means more jobs and investment in the UK, more money in people’s pockets, and transformed public services.”