Overview
Sebastien Bonneau, partner at law firm McDermott Will & Emery, said:
“The UK seems to have the ambition to take the lead across Europe on building a regulatory landscape that is favourable to the data center and broader digital infrastructure sector, supporting the investment in the renewable energy storage and designating data centres as critical national infrastructure.
In contrast, the EU recently announced investments shy of 1b Euros to bolster digital connectivity networks across the European Union, which in terms of proportion looks clearly insufficient at times where the construction cost of one single large data center facility is superior to this amount.
In the race to the future, UK’s is making strides.”
Shah Jahan Khandokar, partner at law firm McDermott Will & Emery, added:
“Off the back of last week’s LDES announcement by the Department for Energy Security and Net Zero, yesterday’s Investment Summit (which resulted in the announcement of over £50bn of energy and data centre related projects), the onus is on the new Government to ensure that the UK really is competitive not only against other G7 countries, but also against non G7 renewable-resource rich countries which are falling within the sight of data centre developers with green aspirations. The focus needs to be on streamlining planning regulations, and, from a practical perspective, the number of stakeholders who have the ability to say no to a project; investors are of course fine with projects being vetoed, they are not however comfortable with inconsistent criteria being applied by different stakeholders, such as the Regulator, Secretary of State, Planning Inspectorate, and Local Councils and their consultation bodies. Alongside this, energy developers will need to see improvements across the entire value chain, i.e., winning long duration electricity storage auction is one thing, being grid connected in time and in line with one’s financial model is another.
We are seeing more and more developers looking at emerging markets where, for example, there may be better solar irradiation or wind yield, and on top of this, the assets may be easily located next to operational substations or the regulatory framework may allow the developer to implement the relevant transmission infrastructure. When it comes to energy intensive assets in particular, the Government needs to ensure that the UK can compete against these countries.”
