MPs warn UK data centre expansion could undermine net-zero carbon targets

A parliamentary inquiry has exposed a potential mismatch between the UK’s push to host large‑scale AI and cloud infrastructure and the carbon accounting underpinning legally binding carbon budgets. Lawmakers, led by the chair of an environmental scrutiny committee, have pressed ministers to confirm whether submissions to the carbon‑planning process explicitly incorporated projected load and emissions from a rapid wave of new data‑centre developments. Industry and third‑sector evidence points to roughly 100 proposed sites; analysts estimate that a small group of the largest facilities could add annual CO2 on the order of millions of tonnes—comparable to near‑term emissions savings assumed for the EV transition. Estimates of electricity demand from the sector vary widely: a near‑term operational figure for 2025 is in single‑digit terawatt‑hours, while long‑range scenarios stretch into multiple tens of terawatt‑hours by mid‑century. Separately, the head of the UK’s electricity system operator has warned that very large, inflexible computing campuses create system‑level costs by complicating balancing and network planning. He recommended policy and commercial responses such as siting the biggest, ~1 GW‑scale loads where renewables are occasionally constrained so they can act as local sinks for variable generation; and using locational pricing signals, conditional connection agreements or revised connection terms to better reflect system costs. International examples and developer practice show a range of mitigation options—bespoke commercial deals, acceptances of connection fees, commitments to demand‑response, behind‑the‑meter batteries, on‑site dispatchable renewables or storage—that can blunt local bill impacts but add cost and complexity. Charities and watchdogs caution that omitting data centres from carbon budgets risks creating an unmanaged emissions source that would consume a meaningful share of national carbon headroom, while the system‑operator view highlights the parallel risk that costs could be socialised across consumers unless connection and market rules change. The department responsible for energy policy says it will examine emissions from these facilities, but ministers have not confirmed whether the independent climate advisory body's latest guidance explicitly covered accelerated data‑centre deployment. The combined uncertainty—over electricity demand trajectories, potential use of on‑site gas for resilience, and whether developers will adopt demand‑flex, storage or contractual renewables—means the issue is both a carbon‑accounting and an electricity‑market design problem. Resolving it will require clearer modelling assumptions in the carbon‑budget process, tighter or conditional planning and connection requirements, and incentives or rules to ensure large sites contribute to system flexibility rather than exacerbate balancing costs. If growth tracks the higher end of forecasts and mitigation is limited, balancing the statutory carbon cap for the next review period would demand compensating measures elsewhere or retrospective tightening of rules for the sector. The evidence presented to MPs frames data centres as a national decarbonisation variable that implicates industrial strategy, grid operations and finance, not just a local planning matter.