Data centres and a backlash moving faster than its argument

The backlash against data centres has gathered considerable pace, but what exactly it is a backlash against has only become harder to define. Concerns about water, power, housing and noise now sit alongside unease about Big Tech and questions over who should own the infrastructure, with these positions reinforcing one another politically even where they describe different problems and point towards very different answers.

The industry has taken notice, with AI firms reportedly telling government it has about a year to head off protest before construction is threatened. A deadline for persuading people is a curious thing to set before anyone has quite agreed what the argument is actually about.

Wales shows how quickly the terms of debate can shift. In Newport, residents beside a facility have raised concerns about sunlight and noise while operators point to compliance with noise and air quality controls. Meanwhile in Cardiff, plans to replace an NHS park-and-ride site with a data centre have drawn more than 1,200 objections, with temporary gas generation expected near homes while the scheme awaits a grid connection. What begins as an argument about one development quickly becomes something larger: about land, infrastructure and ultimately who gets to decide.

Housing has become another fault line, although that debate is already moving on. Only recently were data centres presented as coming at the expense of housebuilding, with both seen as competing land uses on scarce land. The Cardiff case complicates that binary: near where the proposed site sits, 100 homes built under the council’s housebuilding programme have recently been occupied. With parallel cases being made for more housing and more digital infrastructure, both in response to recognised national needs, the question is less which takes precedence than how the two can coexist.

More revealing perhaps is the shift from what data centres consume to who owns and benefits from them. In Slough, home to more than 40 facilities, the council is pressing operators for more visible local benefits as residents question what hosting digital infrastructure has meant for the town. Some detractors have gone further in pointing to the concept of the data centre as a ‘public computer’, pushing the argument beyond community benefit and towards community ownership.

So what happens when government itself starts to define the bargain? Announced today, the Budget’s new Data Centre Covenant asks strategic data centres seeking enhanced support to meet tests on energy, environmental standards, jobs and security, while committing substantial investment to host communities through Local Benefit Plans.

The Covenant comes with incentives attached. A new Ministerial Control Centre will seek to speed up power for these projects by reserving future grid capacity, reallocating capacity released as projects leave the queue and potentially facilitating transfers of pre-2030 connection contracts. Exceptionally strategic projects could even use temporary generation while awaiting a permanent connection.

The bargain is clear enough even if its boundaries are not. Government wants more from strategic data centres in return for doing more to get them built. Yet what qualifies as “strategic” is to be decided and preferential treatment brings its own tensions - if scarce grid capacity is reserved for strategic demand, what does that mean for everything else waiting to connect?

That is where the politics is moving: towards harder terms on which data centres get built, including which projects merit acceleration and what communities should expect in return. The backlash may be moving faster than its argument, but the Budget suggests government has decided not to wait for it to catch up.