UK regulators are weighing upfront deposits for new data centre grid connections to curb queue speculation.
Why it matters: The plan could raise the upfront cost of building AI infrastructure and slow some projects' path to power. It also signals tighter screening for large electricity users as the UK tries to manage fast-growing demand.
- BBC reported the proposed deposit could range from about £237,500 to £712,500 per megawatt.
- Ofgem said in June it was developing a data-centre specific financial regime and updated securities rules.
- The UK government said the transmission demand queue grew 460% in the six months to June 2025.
- NESO is still working on its 10-year demand forecast, with release targeted for July 30, 2026.
UK energy regulators are considering upfront deposits for new data centre grid connections as they respond to rapid growth in electricity demand from data centres. In a July 29 report, the BBC said the proposed deposit would be about £237,500 to £712,500 per megawatt for new projects.
The government said in March that its strategic-demand consultation would address speculation in the connection queue and prioritize future capacity for strategic demand, including data centres. In the same period, it said the transmission demand queue had grown 460% in the six months to June 2025, with data centres a major driver.
Ofgem said in June it was developing a data-centre specific financial regime and updated securities rules in spring 2026. The regulator also said its Connect Operate work would look at the operational impact of data centres and other large demand users, and could include data-centre-specific policy.
The government has also said data centres were designated critical national infrastructure in 2024. NESO is working on its 10-year demand forecast, with publication targeted for July 30, 2026.
By the numbers
- £237,500 to £712,500 - BBC-reported proposed deposit range per megawatt for new data centre connections
- 460% - growth in the transmission demand queue over the six months to June 2025
Yes, but: The proposal is still being discussed, and the dossier does not say a final rule has been approved.
What's next: Watch for Ofgem's updated securities regime in spring 2026 and NESO's 10-year demand forecast targeted for July 30, 2026, which could shape the final policy approach.