NEWS / OCT.2026
UK launches covenant to accelerate strategic data centres
The UK government has published a covenant to facilitate electricity grid connections for strategic data centres. Projects seeking additional support will have to meet commitments, including to local communities.
The UK publishes its Data Centre Covenant to accelerate strategic projects
The UK government published a covenant on 28 October 2026 intended to accelerate strategic data centre projects. Chancellor of the Exchequer John Healey announced the Data Centre Covenant in Parliament in his Budget speech. Among other measures, it aims to facilitate access to the electricity grid for certain projects.
The government plans to reserve a share of future capacity and reallocate capacity freed up by projects leaving the grid connection queue. Applications deemed strategic, including those for certain data centres, could thereby gain access to the grid more quickly. This redistribution can change the order of access to a limited resource; it does not, by itself, create additional electricity capacity.
Data centres power everyday digital services, and the rise of artificial intelligence is increasing demand for computing power. In its 2025 roadmap, the government estimated that at least 6 gigawatts of data centre capacity suited to artificial intelligence would be needed by 2030. This is an estimate of future needs.
Commitments to obtain additional support
The covenant published by HM Treasury covers five areas. It addresses electricity system costs, local benefits and the environment. It also concerns UK jobs and supply chains, as well as national security. All data centres are encouraged to meet these criteria. Strategic projects seeking additional government support will have to meet them.
The government expects operators, among other things, to pay their share of the costs they impose on the electricity system. Developers of strategic projects will also have to draw up a local investment plan with local communities. Operators are also encouraged to publish their total and peak water and electricity usage data annually.
The definition of strategic data centres and the additional criteria have yet to be published. They will specify the conditions for access to enhanced support.
A framework for temporary on-site electricity generation must also be developed. It would be reserved for exceptionally strategic projects when other measures cannot deliver the necessary capacity in time, subject to certain conditions, including energy security.