Data centres stunting development of housing in London
The expansion of data centres is being blamed for delays in delivering new housing in London.
A new report says the substantial energy demands of data centres and other energy-intensive industry temporarily halted new housing developments in the city.
It comes as the government scrambles to build new homes to alleviate a housing crisis in the UK.
A new report from the London Assembly Planning and Regeneration Committee – Gridlocked: how planning can ease London’s electricity constraints – says that since 2022, parts of the London electricity grid, particularly in Hillingdon, Hounslow, and Ealing, reached full capacity, temporarily halting new housing developments.
As a result, the Greater London Authority (GLA) has worked with stakeholders including National Grid and Ofgem to secure short-term fixes, ensuring over 12,000 homes were connected by early 2025.
The report highlights the increasing pressure on London’s electricity grid and the need to plan for both digital infrastructure and new homes, particularly in areas like West London, where capacity has been “stretched to its limits”.
The report calls for a series of policy reforms to better balance London’s long-term energy and development needs. To support more strategic planning of digital infrastructure, it recommends the government introduce a separate use class for data centres, enabling their energy demands to be planned for “in a clearer and more coordinated way”. London’s long-term electricity needs from data centres will require strategic planning to avoid further grid constraints and delays, the report said.
The committee also called for the GLA to include a dedicated data centre policy in the next London Plan to address their significant energy impacts and ensure more coordinated energy planning across the city.
Chair of the London Assembly Planning and Regeneration Committee, James Small-Edwards AM, said: “London is at a critical moment, with energy capacity becoming a real constraint on both housing delivery and wider economic growth.
“Through this investigation we heard from councils, developers and residents about the delays, uncertainty and long-term risks posed by ongoing grid constraints. As demand for power rises, particularly from large energy users like data centres, we need a clear, strategic and long-term approach.
“The recommendations we’ve set out are an essential step towards managing these pressures fairly and ensuring London has the infrastructure it needs to support new homes and a growing economy.”
A new report says the substantial energy demands of data centres and other energy-intensive industry temporarily halted new housing developments in the city.
It comes as the government scrambles to build new homes to alleviate a housing crisis in the UK.
A new report from the London Assembly Planning and Regeneration Committee – Gridlocked: how planning can ease London’s electricity constraints – says that since 2022, parts of the London electricity grid, particularly in Hillingdon, Hounslow, and Ealing, reached full capacity, temporarily halting new housing developments.
As a result, the Greater London Authority (GLA) has worked with stakeholders including National Grid and Ofgem to secure short-term fixes, ensuring over 12,000 homes were connected by early 2025.
The report highlights the increasing pressure on London’s electricity grid and the need to plan for both digital infrastructure and new homes, particularly in areas like West London, where capacity has been “stretched to its limits”.
The report calls for a series of policy reforms to better balance London’s long-term energy and development needs. To support more strategic planning of digital infrastructure, it recommends the government introduce a separate use class for data centres, enabling their energy demands to be planned for “in a clearer and more coordinated way”. London’s long-term electricity needs from data centres will require strategic planning to avoid further grid constraints and delays, the report said.
The committee also called for the GLA to include a dedicated data centre policy in the next London Plan to address their significant energy impacts and ensure more coordinated energy planning across the city.
Chair of the London Assembly Planning and Regeneration Committee, James Small-Edwards AM, said: “London is at a critical moment, with energy capacity becoming a real constraint on both housing delivery and wider economic growth.
“Through this investigation we heard from councils, developers and residents about the delays, uncertainty and long-term risks posed by ongoing grid constraints. As demand for power rises, particularly from large energy users like data centres, we need a clear, strategic and long-term approach.
“The recommendations we’ve set out are an essential step towards managing these pressures fairly and ensuring London has the infrastructure it needs to support new homes and a growing economy.”
