TL;DR
The government’s data centre covenant, unveiled in the Budget, is drawing criticism for asking little of the industry in return for faster grid access, The Observer reported on 30 October. Foxglove, a legal firm that fights data centre plans in court, says nothing in it compels builders to help local communities. With protests in Leeds, Fife, Devon and Wales, the row suggests how much of the government’s AI plan now rests on consent.
We reported on 28 October that the covenant was under consideration, and on its confirmation in the Budget a day later. The Observer’s piece moves the story from what the document contains to whether it will persuade anyone.
The case against
Tom Hegarty, Foxglove’s head of communications, says the text is full of what builders “should” and “may” do. His sharper point concerns the exchange: sites designated as strategic would be “handed a golden ticket to skip the grid connection queue”, he told the paper, “with nothing binding to keep them honest”. The commitments the Observer lists cover clean power, lower local bills, transport, parks, town centres, water use, jobs and apprenticeships.
The grid access at stake is real value. The Planning and Infrastructure Act would let capacity be reserved and reallocated for strategically important projects. The Observer recalls that Microsoft dropped out of Nscale’s Loughton scheme in October, after a warning that sufficient power was years away.
The industry’s reply
Tim Flagg, chief executive of the trade association UKAI, welcomes the covenant and disputes one of the protesters’ main arguments. He says closed-loop UK facilities use far less water than American ones in hot, dry places, claiming that one UK site would need over 15 years what a family of four needs in one.
The evidence offered is narrower than that claim. Matthew Smith of the University of the Built Environment found that the biggest of Slough’s two largest sites was licensed to abstract 1.7m litres daily during this year’s hosepipe ban, while the other used almost no water. So the picture varies by site.
Flagg also raises a point that campaigners and ministers might both note. He has filed a freedom of information request about grid waits with Britain’s energy system operator, and estimates that perhaps 10-15% of the queue represents genuine businesses. That is his estimate, not an official figure.
Looking Forward
In our view, the weakness critics identify is structural. A covenant with soft obligations and hard benefits invites exactly this reading, and it will be tested when the first strategic sites are named. If ministers want protesters persuaded rather than merely outpaced, the most useful thing they could publish is what happens to a developer who fails to deliver what it promised.