- UK data centre sector to grow.
- Sustainability and power infrastructure top concerns.
- Demand rising due to AI workloads.
The ‘United Kingdom Data Centre Market – Investment Analysis & Growth Opportunities 2025-2030’ report has been released, projecting strong growth in the country’s DC sector with a CAGR of 13.33% over the next five years, growing from a value of $10.69 billion in 2024 to $22.65 billion by 2030.
With technological advancements like cloud computing, 5G developments, AI, and IoT continuing to expand and the increased levels of digitisation in the UK, the demand for data infrastructure and data centre solutions is growing and boosting investment in the sector.
The government’s Digital Development Strategy 2024-2030, launched by the Foreign, Commonwealth & Development Office (FCDO) in March 2024, encourages the growth and adoption of digital technologies in many sectors in the UK. That paper focuses on digital inclusion, responsibility, and sustainability.
Due to concerns about the shortage of technical professionals in the UK, the government introduced the Digital Economy Skills Action Plan 2023-2028. Its aim is to train and boost digital skill levels in the country’s workforce. The Plan prioritises wider access to training and hopes to encourage cooperation between the government, and the education & business sectors.
To align with sustainability and carbon neutrality goals, the report states the UK data centre market is focusing on Hydro-treated Vegetable Oil (HVO) in place of diesel in backup generators. UK-based infrastructure provider, AVK, reportedly deployed approximately 500 HVO-run generators in December 2024 in collaboration with Rolls-Royce.
The green agenda & sector expansion
Sustainability and carbon neutrality goals are important drivers in the data centre industry. Lowering the carbon footprint of DCs is now a main priority for operators, owners, and clients. It is expected that other centre operators will follow AVK’s deployment strategy of HVO-run generators to shift towards renewable backup power solutions.
The UK government supports the digitisation of the country, boosting the DC market. A range of initiatives are being implemented to promote digital transformation, including the designation of data centre facilities as critical infrastructure components, alongside water, energy, and emergency services.
In November 2024, UK-based data centre operator, Latos, announced plans to build 40 new data centres by 2030, in response to the increasing demand for AI technologies. Construction of AI-ready data centres are on the increase in the UK, facilities that handle the complex and data-intensive tasks associated with AI processing.
Grid development is another area on which the UK government is particularly focused, both in the DC sector and more broadly. In November 2023, it was announced that around $1 billion was to be invested in support of green industries by the government, especially those associated with power infrastructure. Among the aims was to accelerate the time taken to connect power plants to the national grid.
With an increasing demand and growth opportunities in the data centre market, several players have emerged, including CloudHQ, Ada Infrastructure, Global Technical Realty, Digital Reef, Humber Tech Park, and SEGRO. These companies are contributing to the expansion of the data centre portfolio in the UK, and helping advance sustainable and AI-ready infrastructure.
The next five years will contain further innovation and collaboration between parties in the UK data centre market, as companies try to meet the rising demand for digital services, AI, and green technology.
