Ofgem flags grid bottleneck as new Heathrow data centre gets planning go‑ahead

Ofgem has warned that a wave of speculative data‑centre projects could clog the United Kingdom’s electricity‑grid queue, after Hounslow Council approved a power‑hungry development on a brownfield site near Heathrow Airport. The 12.2‑acre Haslemere Heathrow Estate plan calls for an 80MVA connection, enough electricity to power tens of thousands of homes.

The approval comes amid a scramble to build new facilities to meet soaring demand for artificial‑intelligence workloads. The regulator says each reservation of capacity that never materialises pushes back projects that are ready to invest and connect.

"The connections queue must work for consumers and for projects ready to invest, build and connect," an Ofgem spokesperson told City AM.

Why the grid pressure matters

London already hosts around 99 operational data‑centre sites and a further 26 in the planning pipeline, accounting for roughly 80% of the UK’s total capacity. The Greater London Authority estimates that requests for new electricity capacity are ten times the amount currently used by existing sites. If speculative schemes continue to lock in slots, essential upgrades for housing, transport and renewable‑energy integration could be delayed.

Water usage is another concern. Affinity Water has warned that some data centres request up to three million litres a day, the equivalent of the peak demand of about 3,500 homes. The Heathrow proposal will draw power from the Laleham Grid Supply Point, outside the borough, but the council says it will not tap capacity earmarked for other local developments.

What comes next

Ofgem is consulting on a refundable data‑centre commitment fee and stricter milestones to prove commercial seriousness. Developers would pay an upfront sum to hold a place in the queue; the fee would be returned once the connection is made, but forfeited if the project stalls.

Planning permission alone will not exempt the Heathrow site from the proposed regime. The developer, Brixton (Heathrow Estate) Ltd, must also submit a water‑reduction strategy and meet any additional requirements set by the regulator.

Both the Heathrow project and a similar 52,000‑square‑metre facility approved by Ealing Council still need a Stage 2 referral to the Mayor of London before construction can begin. The timeline for that review remains unclear, leaving the grid queue in a state of heightened scrutiny.

Industry observers note that the regulator’s move could reshape investment patterns across the sector, encouraging developers to secure financing and demonstrate demand before locking in grid capacity.

For a deeper look at how AI demand is driving data‑centre growth, see Anthropic overtakes OpenAI in UK business AI spend, new data shows.