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6 Mar 2024

Challenges and solutions for building Data Centres in the UK

Building a data centre in the UK presents a unique set of challenges and opportunities, especially as the world becomes increasingly digital. These data centres face obstacles related to sustainability, technological demands, and the evolving regulatory landscape.

Data Centres are critical for cloud computing, artificial intelligence (AI), and internet connectivity. They are the backbone of our modern world. However, as demand for digital data rises (estimated to be 181 zettabytes by 2025*, increasing 20-25% each year) the capacity of data centres needs to increase.

Redeveloping an existing site is often uneconomic and offers limited opportunities for further expansion. Therefore, it’s inevitable the need to build more data centres will increase.

But there are challenges (and solutions). Here are some of them.

Challenge #1: Energy efficiency and sustainability

According to the International Energy Agency, energy consumption by the data centre industry accounted for more than 1% of the world’s power consumption in 2023 and is expected to reach 8% by 2030.

The industry is grappling with finding ways to improve energy efficiency, particularly through cooling solutions, and reducing carbon emissions. Not all data centres use water for cooling, but a large facility might use anywhere between 1 million and 5 million gallons of water a day according to estimates by the Washington Post.

The supply of power is a major challenge, especially for data centres in and around urban areas. According to some press reports, housing projects were ‘halted’ in West London due to a lack of available power. The scramble for connection to the electricity grid has resulted in some developers logging ‘zombie projects’ on the system just in case they get planning permission.

Challenge #2: Regulatory and operational challenges

Data centre operators in the UK and globally are facing stricter sustainability and ESG** financial reporting standards, alongside the challenges of managing scope 3*** emissions. These factors combine to make sustainability not just an operational priority but also a regulatory and financial one, impacting the ability to secure funding and investments for new projects.

Certain organisations are required to comply with schemes like the Streamlined Energy and Carbon Reporting (SECR) and the UK Emissions Trading Scheme (ETS). These regulations encourage data centres to monitor their carbon emissions closely and adopt measures to reduce their environmental footprint.

Challenge #3: Supply Chain and cost pressures

With the surge in demand for data centre services, supply chain disruptions have become a significant concern. This is leading to longer delivery dates for data centre construction and an increase in the cost of services.

Challenge #4: Decentralisation and Edge Computing

The shift towards decentralisation, driven by the Internet of Things (IoT) and 5G, necessitates data processing closer to the source of data generation. This poses logistical challenges, particularly in managing security and infrastructure across multiple remote locations.

One of the foremost challenges in building data centres in the UK is the scarcity of land. With densely populated urban areas and stringent zoning regulations, finding suitable sites for construction can be a daunting task. According to a report by Data Center Dynamics, the average cost of land in London alone has increased by 8% in the past year, exacerbating the issue further.

And now the good news. The solutions.

Solution #1: Embracing sustainability by design

Operators are now considering designing data centres with sustainability in mind from the outset. This includes modular designs to manage growth without overprovisioning and considering the total cost of ownership including the environmental impact of their operations.

To address space constraints, data centre builders in the UK are turning to innovative design solutions such as multi-story and underground facilities. By maximising vertical space and leveraging unconventional locations, developers can efficiently use limited land resources.

One such example is the recently completed Ark Data Centre in Wiltshire, which boasts a modular design and the use of underground stone mines and nuclear bunkers to minimise its environmental footprint.

Solution #2: Renewable energy and innovative cooling

To mitigate the impact of energy consumption, many data centre operators in the UK are investing in renewable energy sources such as wind and solar power. Google, for instance, recently announced plans to power all its data centres worldwide with carbon-free electricity by 2030.

Innovations in cooling technology, such as ambient heat loops and fifth-generation heat networks, are making it possible to significantly reduce energy consumption and reuse waste heat.

Thames Water is now working with data centres to try to reduce water usage - at least in terms of freshwater normally reserved for drinking and cooking. The utility wants data centres to make better use of surface water and sewage.

In 2022, AWS announced Water+. They committed to being water-positive by 2030. That means they’ll return more water than they use in their data centres. Twenty of their data centres already use recycled water.

Solution #3: Regulatory adaptation and carbon reporting

Preparing for and adapting to regulatory changes is crucial. This includes tracking and reducing scope 3*** emissions and increasing transparency and accountability in carbon output.

Collaboration is key to overcoming regulatory hurdles in the UK. Developers can streamline the permitting process and ensure compliance with relevant regulations by forging partnerships with local authorities, utilities, and community stakeholders.

Solution #4: Strategic partnerships and AI integration

Partnerships are increasingly important for improving supply chain predictability, especially power. Additionally, integrating AI into data centre operations optimises performance and drives the adoption of energy-efficient technologies like liquid cooling, which is essential for managing the heat produced by AI and high-performance computing (HPC) applications.


Building a data centre in the UK involves navigating a complex landscape of technological, operational, and regulatory challenges. However, the industry can address these challenges by adopting sustainable design principles, investing in renewable energy, and leveraging technological innovations like AI.

The future of data centres lies in their ability to operate efficiently and sustainably, aligning with global efforts to combat climate change while supporting the increasing demands of the digital world.

* Source: Statista 2024
** ESG = Environmental, Social and Governance; the three critical factors used to evaluate the sustainability and ethical impact of an organisation.
*** Scope 2 emissions are the pollution from power that a company buys and uses. For example, the electricity it buys from a power station to light its offices.
Scope 3 emissions are pollution the company doesn't directly create or control. This includes emissions from making and transporting the materials it buys and the emissions its employees make getting to and from work.
Ben McGrady-Johnston

By Ben McGrady-Johnston