UK sets conditions for fast-tracked AI data centers in a covenant and draft planning rules

The UK government on October 28, 2026, set out what it wants in return for helping to build large data centers for artificial intelligence. A Data Centre Covenant, published by HM Treasury alongside the Budget, lists five tests that all data centers are encouraged to meet and that the most “strategic” sites must meet to get extra help. A draft National Policy Statement (NPS) from the Department for Business, Innovation, Science and Trade then sets out how the biggest projects in England would be judged if they skip the local council and seek consent from a government minister.

The government says the country will need 6 gigawatts (GW) of AI data center capacity by 2030 to secure local access to AI models. The draft NPS cites a forecast that this is around three times current capacity.

The five tests

• Bills: operators should pay for any energy costs they create, so households and other businesses do not pick them up, and support grid flexibility and clean power.
• Local benefits: strategic sites must agree a Local Benefit Plan with the host community, with investment linked to the size of the development.
• Environment: new sites should reach a Power Usage Effectiveness (PUE), the efficiency measure the NPS uses, of 1.3 or better, limit use of public water through technologies such as closed-loop water systems, reuse waste heat where a local user exists, and report energy and water use every year.
• Jobs and supply chains: operators should hire locally, fund apprenticeships, favor UK suppliers, and, for the most strategic sites, contribute to developing and deploying British AI hardware.
• Security: sites should give secure UK access to computing for the National Health Service (NHS) and other critical services, and work with the National Cyber Security Centre on resilience.

What strategic sites get in return

A new Ministerial Control Centre, chaired by the Minister for AI, will consider support for strategic data centers. The covenant says it will use state powers to “accelerate time to power” and speed up planning. Under the Planning and Infrastructure Act, the government says it can reserve grid capacity for such projects, reallocate capacity freed when other projects leave the connection queue, and transfer pre-2030 data center connection contracts to strategic sites. For exceptionally strategic projects, it will draw up a tightly controlled framework allowing on-site generation until a grid connection is available.

The government has not yet defined a strategic data center. It says it will publish that definition, and any extra criteria, later.

A national planning route from 100 MW

Since January 2026, data centers in England have been able to ask to be directed into the Nationally Significant Infrastructure Project (NSIP) regime under section 35 of the Planning Act 2008. The independent Planning Inspectorate examines such projects, and the relevant Secretary of State decides. A consent granted this way can include other permissions, including the compulsory acquisition of land.

The draft NPS sets an indicative minimum of 100 megawatts (MW) of rated IT load, the maximum power available to the computing equipment. The government says it would expect requests below that only in exceptional circumstances. Smaller projects would, in most cases, still go through the local authority under the Town and Country Planning Act 1990. Applicants on the national route would be expected to show designs that meet the 1.3 PUE level.

The connection queue is more than 10 times the 6 GW the government says is needed by 2030, although the draft NPS notes that not every request will become a working data center. The government's case rests partly on inference, the running of trained AI models for users: the document says inference is expected to make up most future AI computing demand and is more sensitive to delays than training, so some of that capacity needs to be in the UK.

What comes next

The public consultation on the draft NPS runs until 11:59 p.m. UK time on January 8, 2027, and covers England. Parliament's scrutiny period runs from October 28, 2026, to February 17, 2027. The statement must then be laid before Parliament again before it takes effect, and must be reviewed within five years. The covenant's tests will be kept under review, the government says.